Legal Question in Credit and Debt Law in New Jersey

Liability exposure

My child had an automobile accident where an individual was injuried approximately 18 months ago. My auto liability insurance is only good for $ 100,000 and if sued, the settlement may exceed that coverage. I own a home (mortgage) and would like to take a line of credit to pay for my child's college, clear accumulated debt, and do some much needed improvements on the house.

My question is: Assuming that my house can not be taken away from me, if I take a line of credit, are those available funds now at risk? Is there a difference between taking a second mortgage and taking a line of credit as far as the exposure to being involved in the possible suit?


Asked on 2/09/05, 3:11 pm

1 Answer from Attorneys
Dale Lundquist (Solo)

Re: Liability exposure

I have good news for you. You are not personally liable for the negligence of someone else who drives your car, even if it's your child, except in rare cases such as when you allow an intoxicated person or one you know to be a reckless driver use it. Your child can be sued and judgments can last for 20 years and be renewed for another 20 years but unless the other party was VERY seriously injured, these matters usually settle by the insurance co. paying then policy limits. Nevertheless, I would spend the money for a consultation with an attorney because there may be facts I am not aware of that would change my response. Good luck.

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Answered on 2/10/05, 7:29 am


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