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Subject:  Re: The Plan Date:  1/28/2014  3:26 AM
Author:  joelcorley Number:  307739 of 312187


You wrote, Unless he died in a car crash that totaled the car. (OK, he didn't. It was a sudden illness...but that would be a very good reason why she needs a new car.)

She needs a new car because the 1992 Geo Tracker she is driving is a death-trap. It was dad's car, and he hated it and it was always breaking down, but he couldn't afford a new one. She is a 76 year old diabetic with a heart condition and it's left her stranded more that a dozen times. I don't live close enough to come get her when it breaks down (I am 3 counties away) and he isn't around to help her now. The new car was $6k.

Actually totaling the car wouldn't be a sure-fire reason. If he had collision insurance, the insurance company would pay to replace it. At a minimum, the insurance company would owe his estate for the loss. Or the insurance of the person that hit him would, even if he'd died as a result. Of course he might have only carried liability, but that's not advisable unless he also had funds to buy something as a replacement. (I'm assuming he'd have had those funds in a joint account that would have transferred to your mother at death.)

Anyway, it sounds like your mom had a good reason for needing a new car. I'm not sure it's a good reason for you to buy it for her, but its already done. I just don't think it's smart for people to be helping other people, when they don't have their own house in order. And it just makes it harder for you to get your house in order at this point.

Also why didn't you consider taking a loan out against your mom's new car? You can borrow against used cars you know. And there's a good chance you could get a better rate than the 12% APR on that personal loan. Even if the car is in your mother's name, just have her take the loan out and you make the payments. It could save you some cash. And yes, most banks and credit unions will let you borrow against a used car even after you've purchased it - it just has to be new enough and be worth enough to make it worthwhile to them.

- Joel
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