What to do if after an accisent settlement I still on on my auto loan?

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What to do if after an accisent settlement I still on on my auto loan?

I was hit from behind by a tow truck. The driver was found at fault but the vehicle will leave me paying the bank over $3,000 for a vehicle I no longer own. Can I sue for the full bank loan to be paid?

Asked on May 4, 2012 under Accident Law, Rhode Island

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

Unfortunately, when someone destroy's another's property, he or she is potentially liable for the then-current fair market (or blue-book) value of it. He or she is not liable for what you still owe on the vehicle, if such is greater than the current fair market value--he or she is not responsible for the loan, financing, etc. you took out, but only for the actual then-current value of your car. So you most likely have no recourse to recover the extra $3,000; for future reference, this is why "gap" insurance (which covers that shortfall) is often a good idea.


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