Vehicle Loans in Uncontested Divorces in New Jersey
There are many financial issues to address when going through an uncontested divorce in New Jersey. One is the division of any vehicle loans you have taken out during your marriage. Motor vehicles are one of the most important assets for many people. It’s important to understand the laws that govern these loans to ensure that you divide your finances fairly in the divorce.
When it comes to uncontested divorces, a divorce lawyer can help ensure that both parties make decisions based on their best interests and one party does not take advantage of the other. If you are in the middle of an uncontested divorce in New Jersey, The Law Office of Andrew A. Bestafka, Esq. can help you determine who is responsible for the loan and how best to protect your rights and interests. Contact us today at (732) 898-2378 to learn more through an initial legal consultation.
How Are Vehicles Handled During a Divorce in New Jersey?
The party wishing to keep the car must assume any remaining loan payments or additional associated charges. If the costs are too high for one party to assume, you can surrender the vehicle back to the dealer or finance company.
Alternatively, if the car has a greater value than the amount you still owe, the parties can sell the vehicle, satisfy the auto loan, and divide any remaining proceeds. It is important to remember that both parties are equally liable for any remaining charges regardless of who retains possession of a vehicle obtained during the marriage. For this reason, it is best to come to an agreement that benefits both parties.
Who Is Responsible for the Loan on the Vehicle?
In New Jersey, a vehicle loan is a marital debt, meaning both spouses are equally responsible for it. That means both parties are on the hook if one party does not pay on the loan.
When married couples apply for a car loan, they are both legally responsible for the loan regardless of their marital status. This means that even if a couple goes through an uncontested divorce and one party takes the vehicle, the responsibility for the loan remains with both parties. If one spouse fails to pay the loan, the other is still legally responsible. A divorce agreement does not override the auto loan contract, so any division of property in the divorce decree is irrelevant to the lender.
It’s important to remember that when it comes to auto loans, lenders look solely at the loan contract. As a result, divorcing spouses must take extra steps to ensure that only the party keeping the car is accountable for the payments. To do this, they should work together to modify or refinance the loan so that only one spouse is responsible. They may also need to transfer ownership of the vehicle to the spouse, who will continue to make the payments.
How Do I Change the Ownership of the Vehicle?
If one spouse wants to keep the car post-divorce and the car debt is in both names, the spouse who wants to keep the car can agree to continue making the full payment. To do this, the spouse keeping the car must sign an indemnification agreement requiring them to pay the car note on time until they fully pay it off. In addition, this agreement requires the spouse keeping the car to fully indemnify and hold harmless the other spouse from any liability on the car note. This means the spouse who is holding onto the vehicle is pledging to the other spouse that if they fail to make the payments and the car financing company sues both spouses, the spouse who kept the vehicle will take full responsibility for all costs associated with the lawsuit and payment of the note.
In some cases, a court may order the spouse keeping the vehicle to place the title of ownership solely in their name or refinance the loan in only one party’s name. However, speaking with a lawyer about these details and other vehicle arrangements in an uncontested divorce is essential.
What if My Spouse Doesn’t Cooperate?
Divorcing spouses often face difficulties when dividing property and assets, including vehicles. In the case of an uncontested divorce, both parties should agree about who gets what. If one spouse is unwilling to cooperate and agree on a solution, determining a vehicle’s ownership can be challenging.
In cases like this, seeking legal assistance is the best option. An experienced divorce lawyer can help protect your rights and seek the fair outcome you deserve. Your lawyer can negotiate with your spouse to come to an agreement or litigate the dispute. Additionally, they can provide guidance on how best to move forward with your case.
Overall, a qualified attorney is your best asset when dealing with complex issues during a divorce. By consulting with one, you can rest assured that you have the best possible legal representation and advice.
How an Uncontested Divorce Lawyer Can Help
When dealing with vehicle loans in an uncontested divorce in New Jersey, a lawyer can address the loan and ownership issues and work to resolve them. A qualified divorce lawyer will work with both parties to create a fair agreement for both sides and properly document any changes to the loan. In some cases, one party may need to transfer ownership of the vehicle, refinance the loan, or obtain a release from the lender. A lawyer can also advise on any tax implications arising from loan or ownership changes. With a lawyer’s help, you can be sure that all aspects of your vehicle loan are handled correctly and that your interests are protected during the process.
Speak With a Freehold Divorce Lawyer Today
If you want the best possible outcome in your divorce, speak with a Freehold divorce lawyer. A Freehold divorce lawyer from The Law Office of Andrew A. Bestafka, Esq. can help protect your rights and interests throughout the divorce process. To discuss your case with an experienced Freehold, NJ, uncontested divorce lawyer, call (732) 898-2378 for a legal case review.