Legal Question in Credit and Debt Law in Georgia

When was the car repossessed? Is your daughter still within the 10-day period to redeem the car? If so, why don't you just pay whatever is due and owing on the car? The procedure is that within 10 days after the car is repossessed, the car owner can redeem the car, but usually the lender wants the full balance, not just the past due payments and repossession costs. After that, the car is taken to auto auction and sold for a fraction of the car's worth. The car owner is then liable for any deficiency balance owed on the car.

The problem from your post seems like the car was sold or will be sold and you intend on purchasing her a beater car she can use. However, the car cannot be in her name and/or owned free and clear. The car lender can try and collect the deficiency balance and they have 6 years from the time the car is sold to sue her. If they sue, they can recover a judgment with which they can garnish her wages, levy her bank account or seize any other assets, like a car, which are owned free and clear. So even if she has nothing now, she might if she is sued in the future.

While Georgia does have some exemptions, the ones which protect a car are only available in bankruptcy. Georgia does have some limited exemptions ($5000 for personal property, no-cash) but an election must be made between the bankruptcy and non-bankruptcy exemptions and once the election is made it cannot be changed. So in essence, no one chooses the limited exemptions because they want to be able to avail themselves of the more generous exemptions for bankruptcy should the need to file arise.

You are taking a risk if its owned free and clear in just her name because the car could be seized if anyone gets a judgment against her. And you cannot just wait until a lawsuit happens and then transfer it out of her name; that would be a fraudulent conveyance and if the creditor found out about that they could undo the transaction.

What I would do is either have the car solely in your or someone else's name or title the car jointly with her and someone else (you, your son), but have her listed as the primary driver for insurance purposes either way and make sure there is plenty of insurance. Of course, this assumes she is a safe driver and will not be allowing anyone else to use the car because if your name is on it, you do not want to be liable if the car is involved in an auto accident and another person is injured and not at fault.