CA - Vehicle Co-ownership issue, co-owner abandoned interest won't release interest

[jg916]

California.

Hello Forum,

Any help or advice you could provide here would be appreciated. I'm sure situations similar to this play out quite a bit, I'm just not sure how they are resolved....


A couple in a unmarried relationship purchase a vehicle jointly (Persons 1 & 2) by way of a loan through a bank.

The loan and title use "Person 1 AND Person 2" verbiage on the documentation (rather than term "OR")

Shortly after acquiring the vehicle, the couple split up and Person 2 moved out of state, leaving Person 1 with the vehicle. Person A continued to exclusively make all payments towards the loan, insurance, and maintenance of the vehicle for several years.

Person A would now like to sell/exchange the vehicle and it is proving difficult to get a signed release of interest from Person B. There was not a separate contract of any sort between the couple to establish how the vehicle and loan payments would be dealt with after the split & person B never inquired about the vehicle.

Is there any legal recourse here? Perhaps something to legally establish that Person B abandoned interest for the purpose of establishing Person A's sole ownership?


Thank You

 

[Zigner]

California.

Hello Forum,

Any help or advice you could provide here would be appreciated. I'm sure situations similar to this play out quite a bit, I'm just not sure how they are resolved....


A couple in a unmarried relationship purchase a vehicle jointly (Persons 1 & 2) by way of a loan through a bank.

The loan and title use "Person 1 AND Person 2" verbiage on the documentation (rather than term "OR")

Shortly after acquiring the vehicle, the couple split up and Person 2 moved out of state, leaving Person 1 with the vehicle. Person A continued to exclusively make all payments towards the loan, insurance, and maintenance of the vehicle for several years.

Person A would now like to sell/exchange the vehicle and it is proving difficult to get a signed release of interest from Person B. There was not a separate contract of any sort between the couple to establish how the vehicle and loan payments would be dealt with after the split & person B never inquired about the vehicle.

Is there any legal recourse here? Perhaps something to legally establish that Person B abandoned interest for the purpose of establishing Person A's sole ownership?


Thank You

Person 1 should offer person 2 some money to "buy out" their interest in the vehicle.

 

[FlyingRon]

Person 2 would be an idiot to sign a release on a vehicle they still are on the loan for.

 

[Zigner]

Person 2 would be an idiot to sign a release on a vehicle they still are on the loan for.

Excellent point. I had assumed that the loan was already paid. Oopsie.

 

[OHRoadwarrior]

I usually advise people to work with their lender in these situations. A lender can usually repossess after one payment is a few days late. Borrower can drop car off at auction facility and buy it again with clear title under loan through lender.

 

[Mark Maroon]

I usually advise people to work with their lender in these situations. A lender can usually repossess after one payment is a few days late. Borrower can drop car off at auction facility and buy it again with clear title under loan through lender.

I really like OHROadwarrior's suggestion. A very nifty solution if you can work it out with the lender. But in this case the original poster only said; "Shortly after acquiring the vehicle, the couple split up and Person 2 moved out of state, leaving Person 1 with the vehicle. Person A continued to exclusively make all payments towards the loan, insurance, and maintenance of the vehicle for several years.". Maybe I missed it somewhere else in the post, but it's not clear whether Person 1/A is still making payments on the loan, or if the loan has been paid off (after making "several years" worth of loan payments).

I wonder if your local used car dealership, comprised of people who buy and sell cars for a living, would have come across this situation from time to time and might know how to deal with a situation where a car is owned outright (ie. any loans have been paid off) by Person 1 and Person 2 (where for whatever reasons Person 2 refuses to be bought out and sign over ownership to Person 1).

 

[latigo]

I usually advise people (?) . . .

Would you care to reveal in what capacity you "advise people" and upon what subject matter(s)?

 

[justalayman]

I usually advise people to work with their lender in these situations. A lender can usually repossess after one payment is a few days late. Borrower can drop car off at auction facility and buy it again with clear title under loan through lender.

so both the borrowers will now have a repossession on their credit history and whoops, what happens if somebody outbids them?

 

[jg916]

I usually advise people to work with their lender in these situations. A lender can usually repossess after one payment is a few days late. Borrower can drop car off at auction facility and buy it again with clear title under loan through lender.

I'm not sure how this would make sense. As the other poster stated - both persons A/B would get negative credit reporting and a repossession on their record - not to mention the car (which is a few payments from being paid off) and all its equity would suddenly belong to the lender again? I think we'll pass on that one unless there's something we're all missing here The lender is a top-5 financial institution, they're not going to make any shady understands with one of the 2 parties of the loan they're servicing.

 

[jg916]

Excellent point. I had assumed that the loan was already paid. Oopsie.

Getting it paid off is a technicality at this point... just a few payments away and trying to figure out how to deal with this situation. When I was a kid I used to hear "Possession is 9/10 of the law!" If the car were fully paid off and both the title and car were in possession of "Person A", without any other contracts or agreements existing stating a % ownership/interest in the vehicle... then what?

I guess what I've been asking is if there are any legal processes which could be implemented to get a court to acknowledge and determine that Person B abandoned interest in the vehicle (short of the other person lying/perjuring - this is actually what would be discovered).

 

[OHRoadwarrior]

Everyone is overstating the result. There does not need to be a repo balance filed against OP's credit because there will be no deficiency. At most lender might indicate one late payment. If car sells for more than loan, OP can still buy it at that higher bid price. The profit belongs to him.

 

[Zigner]

Getting it paid off is a technicality at this point... just a few payments away and trying to figure out how to deal with this situation. When I was a kid I used to hear "Possession is 9/10 of the law!" If the car were fully paid off and both the title and car were in possession of "Person A", without any other contracts or agreements existing stating a % ownership/interest in the vehicle... then what?

I guess what I've been asking is if there are any legal processes which could be implemented to get a court to acknowledge and determine that Person B abandoned interest in the vehicle (short of the other person lying/perjuring - this is actually what would be discovered).

As I said - offer the other owner money. It is, after all, half theirs.

 

[Zigner]

Everyone is overstating the result. There does not need to be a repo balance filed against OP's credit because there will be no deficiency. At most lender might indicate one late payment. If car sells for more than loan, OP can still buy it at that higher bid price. The profit belongs to him.

Oh please. You are backpedaling more than usual.

I usually advise people to work with their lender in these situations. A lender can usually repossess after one payment is a few days late. Borrower can drop car off at auction facility and buy it again with clear title under loan through lender.

For the lender to repossess a vehicle, a repossession is entered against ALL owners/borrowers.

 

[justalayman]

And for them to repossess, there has to be a deficiency and a breach of contract. Otherwise it would not be legal for them to repossess the vehicle.