What happens if a leased car got destroyed in another country and payments stopped being made?

In 2014, my husband leased a passenger van. He took it to Mexico, and the van got destroyed. About 10% of the loan was repaid when the accident happened, and since then, no payments have been made. An investigator came looking for him, and I need to know what might happen. Could he go to jail?

This is a complicated situation, especially because the accident happened in another country, and you should seek to resolve it as quickly as possible.
The first thing you need to do is get your facts straight and be able to provide a full recount of the events. You also need to gather all communication, documentation, and pictures regarding the issue and be able to explain:
  • When the vehicle was destroyed
  • Where it was destroyed
  • Who was present
  • All the actions taken afterward
Once you have everything in order, you may want to consider finding legal counsel, but at the very least, you need to contact the leasing company and explain what happened.
The leasing company will take this seriously because they owned the van, not your husband, and their property is now destroyed, and they haven’t received payment. It is hard to say if your husband could face jail time but at the very least, the total cost of the van will have to be repaid.
Typically, if a leased car is destroyed, your car insurance will pay the leasing company up to your policy limit, and you will have to cover the rest out of pocket. However, it sounds like you did not file a claim, and it is improbable that you would be able to now, considering how much time has passed. Even if you did file a claim, your insurance might not cover it because the accident happened in a different country.
While reporting a car accident is never something we want to do, it’s still in your best interest to do so. In the unfortunate event you are in an accident in the future, you should file a claim as soon as possible. To find a car insurance company you trust and feel comfortable working with, you should try talking to Jerry’s knowledgeable agents via text or call. Jerry can also help you find cheaper insurance rates by comparing policies from over 50 top companies, including Nationwide, Allstate, and Travelers, in minutes for free.
Jack Walsh
Answered on Nov 17, 2021

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