Legal Question in Wills and Trusts in New York

Re: Car debt after death

I am sorry for your loss.

As a secured asset, the car company will re-possess the car and dispose of it. The difference between the amount owed on the car and what they re-capture on their sale of the car is a debt of the estate. However, they are unlikely to be paid. They may not seek to have the estate pay them or they may not act quickly enough to have the debt recognized to the estate. In any event, this is a small issue and the ball is in the company's court. The next act is theirs.

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Re: Car debt after death

You do not indicate your position in the estate. Who was entitled to what? What property passed to the widow and what, if anything, was left to anyone else? If the widow was to receive the car, and other family members other assets or part of the estate, she cannot have the loss of the car defeat payment of the other assets to other family members. The deficiency on foreclosure could be a charge against other assets, as an estate debt. However, the widow cannot encumber assets passing to others, to pay her debts unless the Will authorizes this. If this is a possibilty, and she has no authority to do it, can the car be sold to minimize the potential claim against the estate? Use the sale proceeds to meet the outstanding obligations.