Automobile equity

[Psleitch]

What is the name of your state (only U.S. law)? New York
My car is in my employer’s name due to my poor credit. I’ve been paying car notes and insurance for about six months. I’ve terminated my employment with said employer and now they have come and taken the car I’ve been paying for. Do I have any recourse or am I just out the equity I’ve paid into this car.

 

[Taxing Matters]

What is the name of your state (only U.S. law)? New York
My car is in my employer’s name due to my poor credit. I’ve been paying car notes and insurance for about six months. I’ve terminated my employment with said employer and now they have come and taken the car I’ve been paying for. Do I have any recourse or am I just out the equity I’ve paid into this car.

That depends on exactly what the deal was with your employer. Did you nail down with the employer exactly how this was going to work? Was it clear that the car was supposed to be yours from the start, or did you have work for some period of time first, or what? And did you get any of this in writing signed by your employer? I assume the loan is also the obligation o the employer, not you, so that you can just stop making payments and be done with it?

Note that if this was a new car there is almost certainly no equity in it. Cars depreciate a lot in the first year – the moment you take it off the lot it drops in value. As a result, most people owe more than the car is worth for the first year or more.

 

[Psleitch]

That depends on exactly what the deal was with your employer. Did you nail down with the employer exactly how this was going to work? Was it clear that the car was supposed to be yours from the start, or did you have work for some period of time first, or what? And did you get any of this in writing signed by your employer? I assume the loan is also the obligation o the employer, not you, so that you can just stop making payments and be done with it?

Note that if this was a new car there is almost certainly no equity in it. Cars depreciate a lot in the first year – the moment you take it off the lot it drops in value. As a result, most people owe more than the car is worth for the first year or more.

It was a used car, yes it was clear the car was going to be mine. Nothing in writing however the deal was also clear with the car dealership which the owner is a business friend. My boss offered to get a car loan for me in her name and we found one at a local dealership where we both knew the owner. The deal was certainly discussed with the auto dealer

 

[FlyingRon]

Note that if this was a new car there is almost certainly no equity in it.

That's all a function of how much of a down payment you made. Though, given his poor credit I suspect he was quite upside down.

 

[adjusterjack]

What is the name of your state (only U.S. law)? New York
My car is in my employer’s name due to my poor credit. I’ve been paying car notes and insurance for about six months. I’ve terminated my employment with said employer and now they have come and taken the car I’ve been paying for. Do I have any recourse or am I just out the equity I’ve paid into this car.

As a practical matter there probably isn't any equity. Even used cars depreciate faster than loan balances.