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  • Payout of Car Loan

    Hello all, I separated from my wife in late 2007. At the time we separated, we had a car on which money was owing. I was the principal borrower on the loan, and my ex-wife was a co-debtor/co-signor.

    Ex-wife asked me to pay out the loan so she could buy a house with her share of the equity in the matrimonial home, because unless the loan was discharged, none of the mortgage lenders she approached would grant her a mortgage.

    As a result of my paying out the loan, I did not have enough money to make a down payment on a condo. I ended up having to go into a zero-down arrangement to buy the condo - which I think was a mistake on my part.

    This arrangement was not recorded in a separation agreement. In fact, my ex-wife has consistently refused to sign or even talk about a separation agreement.

    Could I make a claim against my ex-wife for half of the value of the loan, given that she was a co-debtor? We didn't make any attempt to sell the car, because I needed transportation, no time was available to sell it, and I was not willing to sustain a shortfall on the sale of the vehicle, since there was more owing on the loan than the car was worth.

  • #2
    So you retained and had use of the vehicle and your looking for your "wife" to come good for a 1/2 loan amount on same vehicle that they did not use?

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    • #3
      I'm not necessarily looking to recover half the value of the loan, but simply asking a question.

      My perspective on the matter is that by paying out the loan, I indirectly helped my ex-wife secure some real property. I could have said 'no' to her request that I pay out the loan, and continued to make payments on it. She derived a financial benefit from my actions, and was relieved of her legal responsibilities with respect to the loan.

      I'm also trying to get a sense of whether I could use the issue of the loan as a bargaining chip in any negotiations that may follow after my ex files for divorce.

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      • #4
        Are you Divorced? If not she is still your wife.

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        • #5
          So she's still my wife in a technical and legal sense. What has that got to do with the question I'm asking??

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          • #6
            It has much to do with what your asking.

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            • #7
              You were married, you bought a car together....

              You separated, you paid off the car loan, used the vehicle and never sold it...

              And NOW you want her to be responsible for her half of the debt?

              I am no Lawyer, but either way you spin it, THAT is a weird question.

              If the car had ANY value, she would be entitled to half.

              During the divorce proceedings, the car would have been sold and any remaining proceeds after the car note was paid, would have been split between the pair of you 50/50.

              Plus you are placing blame on her for your financial misjudgement with your condo???

              I am wondering what you are trying to accomplish?

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              • #8
                - and a prevailing Separation agreement. Details unknown.

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                • #9
                  Why didn't you just refinance the balance fo the car in your own name? It seems to be property that you kept - you should pay for it.

                  You discharged a loan that she was liable for to retain a car that you are driving, is that correct? That was the correct thing to do, move on.

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                  • #10
                    While she may have been legally and financially liable for the car loan, she recieved NO BENEFIT from it. So you think you did her a huge favour by paying it off early? Maybe, but she owes you NOTHING for doing that!

                    To try to get some sort of compensation for that is ridiculous! Didn't she do YOU a favour by co-signing for the car in the first place? I think her "debt" is paid.

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