Legal Question in Credit and Debt Law in California

i seperated from my fiance 2yrs ago and he maintained possesion of an off road vehicle we had purchased. we still had a loan through a local bank and i tried to get my name off the loan but i was told they don't do that when a couple seperates because it is easier to go after two people than one person.Well he wasnt paying the payments and the vehicle ended up getting stolen.I called the bank and he hadnt provided proof of insurance and the bank is supposed to add insurance to protect the bank, but the bank hadnt added it. After i talked to the loan adjuster at the bank, the bank added it because that was their mistake.The bank sent it to the claims office and started a claim for the vehicle.Well the insurance company ended up deciding they wouldnt cover it because the insurance company couldnt switch the title into the name of the insurance company because the police dept put a hold on the title since it had been stolen. Now it has been sent to a collection agency and the collection agency is sending me letters for a payment and are threatening to take further action. What i didnt understand was how come the insurance company couldnt cover the vehicle loan because i doubt we were the first instance of a vehicle being stolen and I want to find out what are my options now?


Asked on 3/23/10, 4:02 pm

1 Answer from Attorneys
David Gibbs The Gibbs Law Firm, APC

First, you need to understand that irrespective of who held possession of the vehicle, you are liable for repayment of the entire loan. Yes, your ex-fianc� is also liable, but the bank is going to look to each of you to satisfy the entire amount they are owed. Second, if there wasn't insurance at the time the vehicle was allegedly stolen, then the insurance company is going to deny the claim. It again, was you and your ex's sole responsibility to maintain insurance to repay the loan in the event the vehicle was stolen or destroyed. The bank is generally not liable for failing to place insurance.

Your best bet is to settle this with them. They will sue you if you don't, and they could very likely win the full judgment. You would be better served to settle with them, then go after the ex for contribution.

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Answered on 4/01/10, 4:34 pm


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