What Happens to a Car or Vehicle in Probate?

Although we all need and use our cars, and although they aren’t cheap items, cars are different from a lot of other assets that go through probate, because cars tend to depreciate. That means that unless a vehicle is a collectible of some sort, spending a lot of time and money fighting over a vehicle doesn’t always make a lot of sense, especially if it’s an older vehicle.

The good news is that the law is set up to make it relatively easy to transfer ownership of cars in probate, or after death, in some situations.

How is it titled?

The first thing to determine is where the car is titled; a car titled in Florida will pass pursuant to Florida’s laws, but even if a car is physically in Florida at the time of the owner’s passing, if the vehicle is titled in another state, it will pass under the laws of that state.

Another thing to look at, is whether the car is owned by just the deceased, or whether it was owned jointly. If the vehicle is jointly owned and jointly titled, it will pass to the surviving member outside of probate–if it is owned as Owner 1 “or” Owner 2, (as opposed to “and”), then the vehicle automatically passes to the surviving owner, and with a death certificate, the state will issue a new title in the survivor’s name.

The same applies to anything on the title that indicates a “right of survivorship.”

But if the co-owned vehicle is owned by Owner 1 “and” Owner 2, and there is no right to survivorship, things work a bit differently, because the law assumes both people on the title have partial ownership. That means that the portion of ownership of the vehicle owned by the deceased, would pass pursuant to the will or intestate statutes and the surviving owner, would co-own the vehicle, with whomever inherits the deceased’ share of ownership in the vehicle.

You can also designate (while you are alive, of course), for a transfer-on-death designation, which also will automatically transfer title to the vehicle to whomever you designate, which will happen outside of the probate process.

Exempting Vehicles

If there are creditors to the estate, the vehicle may be able to be claimed as exempt from creditors–the law allows up to two vehicles to be claimed as exempt (although in reality, a vehicle with a loan on it may be upside down and have no equity, and may not need to be exempted for creditor protection).

Exempt property generally passes to a spouse or children, absent anything to the contrary in a will. But if there is a will, the vehicle won’t be exempt (but again, may not need to be exempted), and will pass to whomever is supposed to inherit the property pursuant to the will.

Quick Process

In some cases, if there are not enough assets to open or to require a full estate to be opened, the law allows someone who inherits a vehicle to simply fill out a form with the DMV, showing the will. If there is a personal representative, he or she can also sign to transfer the vehicle to whomever is supposed to inherit it.

Call the West Palm Beach probate law attorneys at The Law Offices of Larry E. Bray today for help in handling your assets and protecting your heirs and beneficiaries.

Source:

progressive.com/answers/what-happens-when-a-car-owner-dies/