Everyone experiences an occasional setback. And sometimes one comes close on the heels of the other. It can feel like you never get a break. If you’ve just used a car title loan to cover an unexpected expense, getting in a car accident may feel like the end of the world. Do you know what to do if you get in a car accident when you have a car title loan? Are there things you can do before it happens to protect yourself? Max Cash Title Loans has assembled the information you need to take the steps to protect yourself when you have a car title loan and are involved in an accident.
What Should I Do if I Get in a Car Accident While I Have a Car Title Loan?
The initial steps of dealing with a car accident when you have a car title loan are the same as they would be with any car accident:
- Move to a safe place if possible
- Turn off your car and make sure you are okay
- Check on anyone else involved
- Call the police to the scene
- If the police can’t get to the scene, if there are no injuries for example, you’ll need to file an accident report through your state’s DMV
- Gather information
- You’ll need things like the vehicle make and model, the other driver’s insurance information, contact information for eye witnesses, license plate numbers, etc.
- Take photos of the scene for use during the claims process
- File and insurance claim
After you’ve taken these steps, you’ll need to notify your car title loan lender. It’s important to note that you’ll still be responsible for your car title loan payments while your insurance claim is being processed, even if your car is totaled and no would no longer qualify for a car title loan. If your car is declared a total loss, your insurance company will write you a check for the appropriate amount. Because your lender has a lien against the vehicle, you will need to put the money towards paying off the balance of the loan. Any leftover money can be spent as you see fit, in accordance with your insurance agreement.
What Can I Do Before I Get in a Car Accident to Protect Myself When I Have a Car Title Loan?
One of the best things you can do to prepare for an accident is have adequate insurance. Imagine what would happen if you needed your car to get to work and an accident made it undriveable. You’d be responsible for your regular expenses, your car title loan, and potentially a rental car while your ride was in the shop or while searching for a new car. That would be quite stressful. With the proper coverage, your insurance company could not only pay for the car repair but reimburse you for rental car expenses. Depending on your car title loan agreement, your lender may require you to take on additional insurance. This is to ensure that the loan is repaid in the event of an accident.
It’s also important to be familiar with the value of your car. If you’ve gone through the car title loan process, you probably have a rough estimate of what it is. You should also know the details of your car insurance coverage. It’s also important to consult state laws, as they may mandate coverages that are available or required.
How Do I Determine the Value of My Car?
The value of your car is determined by a number of factors. While the make and model of your car are important, they may have less influence than something like the mileage of the car. The mileage is often an indication of what work needs to be done on the car and what work has been done, in addition to the sort of general wear and tear that has occurred. The condition of the exterior and interior of the car can also impact the value of your car. Even if damage is cosmetic, it can reduce the value. Any major engine problems will also lower the amount you’ll be able to get for your car.
If your car is in an accident, an insurance adjuster will look at it and assess the damage. Based in their assessment, they will determine how much it will cost to fix the car. The amount of costs to fix the car will be deducted from the value of the car.
Can I Use the Insurance Money to Pay for a New Car and Transfer my Car Title Loan to it?
Unfortunately, this isn’t possible. When insurance money gets paid out for a piece of property, if there is a lien against that property, the lienholder gets paid first. This means that any money goes directly to the lender without ever passing through the borrower’s hands.
Looking for money to cover an emergency expense on short notice is stressful enough without having to worry about what happens if your car gets totaled in an accident. Now that you know a little more about what happens when you have a car title loan and your car gets totaled in an accident, you can prepare by making sure you have the correct amount of insurance to protect yourself. If you have any other questions feel free to contact Max Cash Title Loans. As a financial referral service, we are familiar with many of the ins and outs of car title loans.