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Author: lessob Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 308881  
Subject: Update on ins $$ from car accident! Date: 1/10/2003 2:54 PM
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A couple of weeks ago I was telling you guys about a fender bender I was involved in: http://boards.fool.com/Message.asp?mid=18307585.

I was rear-ended (i.e. not my fault), and my bumper was smooshed.

After estimates said it would take $2,500 to fix the car, I was hoping I could get a check from the insurance company and use it to pay off a credit card. (The car was totalled, according to its blue-book value.) Folks seemed to think this was a legal and perfectly acceptable thing to do.

My car is old, and runs just fine to get me to the grocery store and back. The dent in the bumper is mainly cosmetic. The trunk buckles a little, but I park in a garage. No big deal. The car only has to get me through another 29 months of law school. Thus, not much reason to fix it.

Well...today, after some haggling with the insurance company (they tried to tell us originally that the car was only worth $1,500), they have come back with the following:

They will buy the car from me at $3,106, and I will buy it back from them at $292. In other words, they are cutting a check to me for $2,814 and will be putting it in the mail on Monday. !!!!!!

So, as of Tuesday or Wednesday, I will be mailing a big fat check to Citibank, with a letter to them requesting the account closed.

Wooo - hooo!!

Deb,
recovering from the best car accident of her life
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Author: WayStar Three stars, 500 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 148997 of 308881
Subject: Re: Update on ins $$ from car accident! Date: 1/10/2003 3:11 PM
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Congrats, Deb!

My mind is still spinning trying to figure out how the whole thing works, but I'm sooooo glad it's all working out. (Especially since no one was hurt.)

Cheers,
WayStar

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Author: brewer12345 Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 148999 of 308881
Subject: Re: Update on ins $$ from car accident! Date: 1/10/2003 3:16 PM
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Be aware that this may mean that the car is considered a "salvage" vehicle, and this may be indicated on the title. As such, the car will be worth very. very little if you choose to sell it. Then again, with a mashed bumper and arguments as to whether the car is worth $1500 or $2500, I doubt you'll be selling it until you have to pay someone to take it.

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Author: lessob Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 149000 of 308881
Subject: Re: Update on ins $$ from car accident! Date: 1/10/2003 3:21 PM
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Be aware that this may mean that the car is considered a "salvage" vehicle, and this may be indicated on the title. As such, the car will be worth very. very little if you choose to sell it. Then again, with a mashed bumper and arguments as to whether the car is worth $1500 or $2500, I doubt you'll be selling it until you have to pay someone to take it.

You're right - the car is already eleven years old, with quite a few "quirks:" Cruise control doesn't work, no radio knob, the cassette player eats cassettes, the motor on the antenna is broken, the motor on the windshield washing fluid dispenser is broken, etc.

I am in love with this car. I've known it since it was brand new (my dad's). It has 168,000 miles on it, and I only keep it for trips to the grocery. I walk to school, and get rides to Chicago to see my BF.

Before the accident, I had already resigned myself to the fact that I would never get much out of it if I tried to sell it or trade it in. That being the case, I intended (and still intend) to run it until it stops running, or until, as you say, I have to pay someone to take it.

The estimate to fix the car is at least $2,500. The car is only worth about $3,000. So, the insurance company says it's totalled, and takes it off my hands for the value of the car ($3,106). But I still want the car, so they allow me to "buy" it back for a minimal amount: $292. No title changes actually take place. They're just cutting me a fat check.

Old blue has one more quirk, and I have a credit card balance of $0.

:)

Deb

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Author: brewer12345 Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 149003 of 308881
Subject: Re: Update on ins $$ from car accident! Date: 1/10/2003 3:46 PM
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Sounds like a good deal then. I'd be pretty pissed if someone nailed and totalled my 95 Escort wagon. Its not worth more than a couple grand, but its reliable, cheap to run, and I absolutely don't care about the odd parking lot ding, etc.

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Author: rosietomato Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 149006 of 308881
Subject: Re: Update on ins $$ from car accident! Date: 1/10/2003 4:18 PM
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The same thing happened to me TWICE!!!! Both times I received more than I paid for the cars when I bought them (each was purchased with 150,000 miles on it and were already 8+ years old but were lovingly maintained and I had complete service records on each) I'm still driving the second car for the last two years. Who cares about a salvage title if you're going to drive it into the ground.

volvo wagons never die, they just get rearended......

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Author: FuskieFool Big funky green star, 20000 posts Top Favorite Fools Old School Fool Ticker Guide SC1 Red Winner of the 2010 Rule Breakers Challenge Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 149014 of 308881
Subject: Re: Update on ins $$ from car accident! Date: 1/10/2003 5:14 PM
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What you should do now is set aside a fixed amount each month into a interest bearing account so that when your car finally does die, you have money saved up as a down payment on a new used car.

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Author: ImCalvin Two stars, 250 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 149018 of 308881
Subject: Re: Update on ins $$ from car accident! Date: 1/10/2003 5:52 PM
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So, as of Tuesday or Wednesday, I will be mailing a big fat check to Citibank, with a letter to them requesting the account closed.

Firstly, congratulations! What a deal.

Secondly, assuming you can exert the self control to not use it (unbudgeted plane tickets to Chicago ;) you might actually want to keep that account open. It seems having unused credit available is actually a positive on your FICO score for a couple reasons:

- proves companies are willing to lend you money
- you extend your length of time the account is in good standing
- you extend the time you pay your bills on time (even if it's a $0 balance)

If later you decide you need more credit you won't have to lower your FICO score to get a completely new account.

If you can't trust yourself with the card, just cut it up or lock it away. You can always get a new card from Citibank, but it won't cost you as much in your FICO score as opening a new account will.

-Ben
trying very hard not to use my "closed" accounts

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Author: joelcorley Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 149022 of 308881
Subject: Re: Update on ins $$ from car accident! Date: 1/10/2003 6:13 PM
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brewer12345,

You wrote, Be aware that this may mean that the car is considered a "salvage" vehicle, and this may be indicated on the title. As such, the car will be worth very. very little if you choose to sell it. Then again, with a mashed bumper and arguments as to whether the car is worth $1500 or $2500, I doubt you'll be selling it until you have to pay someone to take it.

Sounds like she's already found a buyer... so to speak.

- Joel

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Author: xraymd Big gold star, 5000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 149058 of 308881
Subject: Re: Update on ins $$ from car accident! Date: 1/11/2003 2:28 PM
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Greetings, Deb, that's GREAT about the "found" money which will pay off Citibank.

I echo the advice of the poster who suggests that you actually DO NOT close Citibank - instead, pay it off to $0 (which may in fact be achieved only next month given any interest residue from the 2-cycle average daily balance which will still be due and payable in the cycle following the one you paid to $0). And once the statement cycles with a $0 balance, you could be ready for:
1) using it ONLY (repeat, ONLY) for what you will pay off on it every month - thus your purchases will not be inflated in cost by having interest cling to them. If you decide to do this, I strongly suggest subtracting every single purchase made on Citibank from your checkbook balance (make some sort of special notation that indicates that that amount is earmarked for the card) so that you won't be scrambling to find the money when the bill comes due

or
2) you could be made a sweet 0% balance transfer deal which will lower the cost of the remaining credit you are carrying elsewhere. In which case, of course, you make an effort to get any balance transfer fees waived and you undertake NO FURTHER transactions on Citibank (no using it for any purchases) apart from paying on it, so long as there is an outstanding balance transfer. Of course, if this ends up paying off Capital One you could turn around and do with Capital One as you might have done with Citibank without the transfer (see point 1 above).

In other words, the Citibank card is worth more to you alive with a $0 balance than closed with a $0 balance because of the potential it will have for allowing you to lower your overall interest costs. Plus it keeps your FICO score higher NOT to close it!

xraymd

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