Posted on 01/25/2005 7:45:11 PM PST by blinachka
Please help fellow Freepers!
I need some advice about auto lease termination rules. My father died on December 24, 2004. He had a lease agreement for a 2003 Chevy Impala. At the time of his death there still remained one year and two months on this lease.
The car has been returned to the dealer and my mother was informed that as far as the dealer was concerned, the lease agreement is ended.
Enter GMAC...in a letter addressed to the "Estate of..(my Dad)" it is explained that the car will be sold (the letter is a "Notice of Intent to Sell"). There is a section explaining the "Charges Due" which are $3,862, and immediately following this it says: "If the amount we recieve from the sale of the vehicle exceeds the residual value, we will credit your account by the amount of the excess." The "residual value" of the car is not listed in the letter.
I looked up the various values on the Kelley Blue Book site. The retail value for this car is $14,670. I imagine that this is likely to be the "residual value" for GMAC and if they sell the car for more than this amount, the excess monies will be applied to what is owed on the account.
My question is this: Since my Dad was the only person named on the lease agreement, should my mother be held responsible for the "Charges Due" on his lease agreement? I understand that my father's Estate is being held liable for these charges but there is, in fact, no Estate to speak of. The joint checking account my parents had has less than $500 in it. Other than that, there are no assets in his name. What can GMAC do to my mom if they do not recieve this money?
Please understand, this was not her car and she never used it, which is why the lease was only in my Dad's name (she has her own car which she owns outright). It's not that she's trying to get out of any financial obligations. It's that I am afraid of her having to pay for something that was never hers to begin with.
So basically I'm asking if anyone out there knows what the rules/laws are regarding early termination of a lease due to the death of the lesee.
I appreciate any help you all can give me! THANK YOU!! : )
-Blinachka
GMAC, OTOH, is a cousin of the notorious GE Capital group which may write leeses making the leesee responsible for the sum of all payments until the leese matures. We had this problem for a lot of the office equipment where I work and I personally got the finance manager to issue a directive that no leeses of any kind would ever be signed with GE Capital. We got them off our books and out of our life.
There is some possible good news in that the GE Capital group often talks leesees into buying life insurance as part of their leese which will pay off all liability in the event of death of the leesee. Read the leese carefully before approaching GMAC.
Unfortunately, we already did this (look through the Lease Agreement) and NOWHERE is there any mention in regards to the Death of the Lesee.
There is mention of Early Termination (and I suppose that they consider this to be the same) but I feel this should not apply because the lesse (my Dad) is deceased. He did not willfully terminate the Lease early...he really had no choice in the matter...
What state are you in?
New York
I know someone in Management at GM. I'll ask him.
I am also in NY and will check in the day on Wednesday with one of the people in my office who use to sell cars. When do they tell you that you and your mom have to get back to them?
I am not a lawyer and it will be interesting to see what the other freepers will have to say, but if it were me, I'd wait until I hear from them again telling your mom what the "Estate of _____" owes, and believe me, it will be quite a lot. Once you receive that letter, write them and tell them there is no estate. If your father had no assets in his name, then there is no estate. They will have to write it off. And don't feel sorry for them, they've already made a huge profit on that car.
It's really not a big deal so DON'T WORRY!
The "residual value" of the car should be what they would be able to sell it for AFTER the lease expires, not what they sell it for now. You should be able to get at least one year's worth of value from them as part of the "over the residual value." The problem will be determining how much and getting them to agree to it.
Good luck -- Randy
Trust me...I don't and won't!!
Thank you...I think I will call a lawyer for advice on this, but we will leave it alone until we hear back from them. In this time the title to the house will be transferred to my name (along with Mom's, whose is already on it, and my Dad's will be removed)to avoid any problems when we sell the house this Spring/Summer. Ugh..I hate this crap!
I have to say this. We have no problem paying the balances on his credit cards as those are debts he made and I believe they ought to be paid. As for the car lease...it was HIS car only and the car has been returned. I do not believe that my mom ought to have any responsibility for it whatsoever...especially because she doesn't even have the damn car (she hated it)!!
Ah, we'll just sit tight and wait!
Thanks to ALL who replied to my post! FReepers are the BEST! :) I knew I'd get some good responses...and I am grateful for it!
We don't have to get back to them, it is they who will get back to us (actually to "the Estate of..." my Dad) once the car is sold. I'm just worrying about them possibly coming after my mom after they are informed that there is NO estate to speak of as far as my Dad is concerned.
So negotiate, cry, whine - get GMAC to accept the car as payment-in-full.
But that would be unusual.
Thanks! I'll do that if need be!
My mother passed away a year ago this month, my father 5 years previously. I've been down that road twice in the last five years. I was a legal assistant for 17 years before I went back to college for a computer science degree. I would strongly urge you to take a consult with a good estate attorney. That person can likely tell you all you need to know and save you countless heartaches in 30 minutes.
I did not do that with my father. I did it with my mother because of the experience with my father. I am not dealing with a big estate either and the attorney I consulted was more than happy to tell me what I needed to know and take an hour's pay and go on. A good attorney with a healthy practice, doesn't need to take on a small estate just to earn a few bucks, so pick an attorney with a stellar reputation. In the long run, that attorney will be cheaper.
I discovered that the laws with regard to estates and contracts are quite different than from those concerning an individual (at least in my state). Getting that information up front can save you a world of hassle and money.
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