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My car was totaled.I only have basic insurance coverage.Help!

Clinton Township, MI |

My totaled car only has basic insurance, not full coverage,so my insurance will not pay for car repair.They only gave me $500 mini tort.Can I have my car fixed a little and sell it to used car sellers/junk yard even if i still have a $3,000 balance on my auto loan?What is my best option to legally sell my car?

Attorney Answers 2


I am very surprised that you only had PLPD insurance on a vehicle with a loan balance, since most lenders require full collision coverage as part of the loan agreement. You may actually be in default of your loan agreement by failing to maintain full coverage. Either way, the lender still has a lien on the vehicle for the outstanding balance of the loan. The title will not be clear until the loan is paid off.

DISCLAIMER: This answer is provided as general information, which may not be appropriate for the specific facts of your particular situation. No attorney-client relationship has been established based on this limited communication. You are advised to consult with an attorney in your jurisdiction before taking any action or inaction that may affect your legal rights.

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First, I agree with the above answer that you may be in default of your lender agreement by not having full coverage on your vehicle. You can sell the car, but you will remain obligated for the remainder of the loan. So if you do sell it, you should try to get either the price of the loan balance or negotiate a deal where the buyer assumes the loan. However, with a totaled vehicle, chances of receiving either is slim.

You need to keep paying your loan though.

DISCLAIMER: This answer does not constitute legal advice and is for informational purposes only.

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