My car is totaled in a Chicago auto accident and I owe more than what it’s worth

Chicago auto accident


What happens if your car is totaled in a Chicago auto accident and you owe more than it’s worth? Be prepared to pay. But there is a way to protect yourself. Call my office for a free consultation at 847-305-4105.

Intro

According to an article on insurance.com, Experian Automotive said around 86 percent of new car buyers finance their vehicle and the average new car loan is about $30,000 for roughly 68 months. So, people are financing millions of vehicles. As such, drivers in Illinois who get in a Chicago auto accident are often faced with paying money owed on newly purchased vehicles that are involved in accidents.

Example

You purchase a car for $30,000. You put $1,000 down and you finance $29,000 through a bank or the auto dealership’s finance company. A few months later you are involved in an accident and your car is totaled. You file a claim with your auto insurance company and they determine that the actual cash value (ACV) of your vehicle is $27,000. What happens?

Your auto insurance company will write a check to your finance company for the ACV of your vehicle and you owe the remaining balance outstanding of $2,000. It’s unfair, you did not cause the Chicago auto accident. Yet you are still on the hook for the balance outstanding.

Gap Insurance

The only way you can protect yourself from this situation is to purchase Guaranteed Asset Protection (GAP) insurance. In the situation above, your GAP insurance would have covered the difference between what your vehicle is worth and what you owe.

You can purchase GAP insurance when you purchase your vehicle from the dealership or you can likely purchase it from your auto insurance company.

If you don’t have GAP Insurance

How do you pay the balance owed if you do not have GAP insurance? Generally speaking, my clients in this situation have been able to continue to make their monthly payments until the balance is paid off. You may also be able to contact your finance company and figure out an alternative payment arrangement.

That’s little solace to someone who just lost their investment in a vehicle including their down payment, has to pay money for a vehicle they can’t drive and may not have money for a down payment on a new vehicle.

If you want to fight it

If you are unhappy with your auto insurance company’s valuation of your vehicle, you do have the option of contesting the valuation of your vehicle. You can try to get your own appraisal from a resource like Kelley Blue Book. That probably won’t work and as such, you will likely have to hire an appraiser to provide a new appraisal to give to the insurance company.

If that doesn’t work, you will have to demand arbitration from your insurance company. If you are dealing with the insurance company for the driver who caused the accident, your only option would be to file a lawsuit.

Do I need an attorney?

Most personal injury attorneys won’t get involved in a matter that only involves property damage. It’s not that I don’t want to help. However, as a Chicago auto accident attorney, I represent people who suffer injuries in auto accidents.

Regardless, I am happy to speak with you about how to proceed with your claim against the insurance company. Call me for a free consultation at 847-305-4105.

Show a little love to truckers and give them the space they need

Truck AccidentsTruck drivers often must mitigate unique safety issues while operating their vehicles. Large trucks can outweigh smaller vehicles by 30 times, according to the Insurance Institute for Highway Safety. Due to this weight, trucks require more stopping distance than other vehicles, as any Chicago truck accident lawyer knows. Large trucks also can ride over other vehicles because of their high clearance.

Continue reading “Show a little love to truckers and give them the space they need”

Niles Automobile Accident And Handling Property Damage

You were fortunate and didn’t have any serious injuries after your auto accident, but what about your car?  If the accident was not your fault and your car was damaged, you can get your car repaired and personal property recovered.  Feel free to consult with Niles car accident attorney, Barry Zlotowicz of the Chicago Legal Group.property damage from car accident

When in an automobile accident, you are entitled to payment for damage done to your car and personal property.  Personal belongings that were inside the vehicle at the time of the accident, if the accident was someone else’s fault includes: computer, iPods, tablets, clothing, eye wear and other personal belongings.

Based upon on your specific auto coverage and who is found at fault of the auto accident, an insurance company, by contract, may be required to pay for the damages to your property.  The insurance contract will often show that the company is obligated to repair or even replace your car.

In the case of repairs, some companies will do their own estimates, although others may ask that obtain your own estimates.  You are typically free to decide which body shop you prefer to use.  On the other hand, some insurance companies may have a list of recommended body shops for you to go through.  If you select one of the recommended shops, and later there is a problem with their repairs, the insurance company may be able to help with handling the issue with the shop.

Additionally, you may be entitled to be compensated for the “loss of use” of your vehicle while it is being repaired.  This payment may be used to rent a replacement vehicle.  The amount in which you may be entitled to may differ under the conditions of your particular case and with the insurance company.

Often your car will be “totaled.”  Generally, a vehicle is “totaled” when the cost of repairs surpasses 80% or more of the value of the vehicle.  The challenges occur when it comes time to figure out the true value of the vehicle.

You may be able to recover your losses from the following sources:

Collision Coverage under Your Insurance – This is normally the fastest and simplest way to get your car repaired.  Your car repairs will be paid under your own insurance policy no matter who is at fault in the accident.

Liability Coverage under the Defendant’s Insurance – If the other person’s insurance company accepts fault in your accident, they will generally pay to have your car repaired. Regrettably, insurance companies usually take days or even weeks to make a decision as to whether or not to accept fault in the accident.

Uninsured Motorist Coverage under Your Insurance – If the person who caused the accident doesn’t have any insurance or is unable to be identified, you are protected under the uninsured motorist coverage of your own policy.

If you are a resident and had a car accident in Niles, we can help you get your car repaired and your personal property recovered.  Our office is equipped to assist you with recouping from the damages. Get in touch right now for a free consultation with Barry Zlotowicz, a Niles personal injury attorney at 847-305-4105 or 877-LAW-4312.