Hello,

I am new to this forum obviously. haha. I have a quick question. My brother bought a 2008 CBR1000 and ended up wrecking it yesterday into a concrete barrier at 95mph.
The bike - it's damaged pretty good on the left side, and moderate damage on the right right. But it's not nearly as destroyed as most would imagine (even though the police report says "totaled"). He, of course, still owes $5000 or so on the loan for it. AND of course, he only have liability insurance (no collision or comprehensive). Stupid? I know.

Anyways, it looks like he will be stuck in a bad situation. Does anyone have any experience or ideas on what he might do? Is there any type of salvage yards that would pay a decent price for it? I am sure it will take a few thousand to repair, and obviously $5000 to get out from the loan on it. Any ideas or experience from people would be awesome!! Thanks!

 

First and foremost, is he okay? The $5000 owe is least of my worries when crashing at 95mph....hospital bill can be 10x as much if not more. If he walked away with few bruises...conside him lucky.

As for the bike, he's likely upside down. Just like when I purchase my house in 2007 for $479K, now crash down to $300K....so I owe bank more than what the house is worth. If I sell my house and use what ever money I got left, won't be enough, I still owe them 100k+, upside down, or you can say I'm under water. So selling it won't help. What I did is call bank, tell them exactly what my situation is....trust me, last thing bank wants you to do is default, walk away, not paying them. Or file bankruptcy....

They'll work a low payment, low interest rate, so your brother can payoff quicker.

You can part out the bike, use whatever money you able to savage and pay bank.

I'm guessing he's paying roughly 12% interest in loan....

Call bank
Tell them what happen
Tell them brother have no money
Ask them for the lowest interest rate possible,

If too high rate, he'll walk away without pay.

Say $50/mo.....so slowly, he'll pay off the loan and maintain good credit.

This is exactly what is call decisions and consequences...

I may the decision to by this house, my consequences is that market crash and I owe more money than what house is worth....

Your brothe decision was not to buy insurance....

 

how is it he owes the bank and has no insurance? how did he get away with that? usually when a bank is notified that coverage was dropped, they will purchase insurance on your behalf and charge you for it. it's in the loan agreement to protect their butts from things like this from happening. hope they did that and he hasn't got the bill yet...

 

Depending on banks, i.e say CarMax auto loan....when I last purchase a used car from them, they provide insurance into drive off cost, which covers the car for 72 hrs....some bank only do 24hrs....now as for full coverage, that's where the red flag marked....I remember if you owe a ton, say $15,000 or more...bank comes back and review your insurance if it's full coverage, if not, they will send you a notice, asking you to buy full cover. This is the main reason I can never afford a new car, cause they make you buy full cover and cost a ton.

The used car I purchase at CarMax, I owe then less than $5000.00. I have been buying liabilty ever since and never receive any notice to furnish full coverage insurance. So I guess bank will red flag to amount owe...rather than make it mandatory. But bank may have sent notice already, but if one choose not to buy, it's their decision, I've never heard bank repo base on insurance coverage.

For me to furnish full cover insurance on my used car that is worth ($12,000) will cost me close to $2000/year....that's 16% of the car's value a year nothing including depreciation...so for me to buy liability insurance, the odds are good.

Motorcycle is different story though...

 

I know.. That was my concern too! I thought it required full coverage. But, it is financed through the bike shop - so they may not require it (as I have heard with some). Also, he just signed up for it 3 weeks ago, so maybe it has not been reviewed and sent back yet.

He is alive though. No broken bones somehow... and has some serious road rash. So injuries are minor.. I know medical costs will be way up! I also figured he would be screwed on the bike, unfortunately. I was trying to see if anyone had experience with an "easy" way to deal with this. But there is not much that can be done. That is why I full-coverage my bike.