Q: How Do I Get Out Of This Car Loan Situation (Divorce)?
I am about to file for divorce. I am the primary borrower for his vehicle. Only he has ever driven it, so it (along with the payments) should obviously go to him. There = about $6,000 left to pay. He just told me it broke down and will cost too much to fix. He said he can only trade it in for $3500, which puts us in negative equity. The auto loan bank said the only way to remove me from the loan is for him to refinance it on his own. He has terrible credit and does not qualify. I am staying with family in AZ, and he is still in ID with the vehicle. I do not want to be stuck financially linked to him and have my credit negatively affected, hoping he makes on-time payments. I have no clue what to do.
This is a tough spot you're in. You are absolutely, financially responsible for your loan on the car, whether it works or is broken or regardless of whether it was you or him who primarily drove it. It's a tough spot! In fact, I'll let you know the WORST part! Let's say you file for divorce and let's say your spouse gets the debt, in the divorce. He won't pay it, at least that's been my sad experience practicing law for 25 years. You're it, I'm sorry to say. The ONLY thing you could do in a divorce situation is: file a divorce based on his bad conduct (cheating, drinking, abandoning you etc). Your attorney can explain how to do this. Let's say he denies cheating or drinking etc. and you have to go to TRIAL to prove that he's a bum and a cheater etc. This might be worth the money to do this. Because if you can get a divorce judge to award you a DIVORCE on fault grounds, the Court can order your ex to pay for the car loan.
Now this is where you need a good lawyer! Because a good lawyer will file the divorce, seeking to make the ex pay the debt, OR, the lawyer could draft the papers asking that the Court order that ex pay the debt or the amount of money it would take you to completely fix the vehicle in new condition. If the Court did this, then a good lawyer could turn this into a "money judgment." You can collect a money judgment the same way a debt collector would, including suing him for the amount he owes + attorney fees OR he could haul your ex into court every time he missed a payment on the debt, and of course, ask for attorney fees every time he has to file a motion to keep the bum making payments. I've done it both ways. It's more expensive to do it through the divorce court, but very satisfying.
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