Ask Laz: Coma? Death? You’re still expected to make car payments

Danielle contacted me about her friend Carlos. Long and short of it is that he leased a car and, a week later, fell into a coma and shortly thereafter died.

Here’s the thing: Carlos’ sister tried to return the car and was told that a deal’s a deal. Monthly payments were still due or penalty fees would be levied.

This is obviously messed up. However, as I’ve written before, death isn’t seen as an adequate excuse by car dealers and finance companies for not paying off leased wheels.

It’s considered “early termination” of a contract, which can result in thousands of dollars in penalties.

Clearly dealers need to protect themselves from people who don’t meet their financial obligations. But the notion of a leasing agreement outliving the lessee seems pretty coldhearted.

There are two things for Carlos’ kin to keep in mind. First, if they haven’t cosigned the lease, they aren’t on the hook for payments. Period.

There will be no financial consequences or damage to their credit scores if they refuse payments.

That said, leasing companies are entitled by law to claim unpaid obligations from the estate of the deceased. So whatever cash or property Carlos possessed at the time of his death could be fair game for the dealer or finance company to go after.

One option is for the next of kin to buy out the lease and sell the car. This is a hassle, but it can avoid a probate fight and keep the estate intact.

My advice is to drive the car back to the lot, ask to speak with a manager and appeal to his or her humanity. Bring a copy of the deceased’s death certificate and any other supporting documents and politely explain the situation.

The dealer doesn’t have to, but it’s entirely possible that he or she will decide not to make a thing out of an obviously unfortunate situation. After all, the dealer is likely to put the car up for sale, so actual losses would be minimal.

In this case, though, the dealer may not be very open-minded.

Danielle says Carlos’ sister was told that if Carlos had just returned the car himself prior to his death, all would have been forgiven.

Sure. Because being in a coma is no excuse for irresponsible behavior.

Got a question? Email me at [email protected]. And follow me on Twitter @Davidlaz.