Car leases after the death of the leaseholder

[E3134]

I am trying to help my sister in law who has had a breakdown following the death of her husband a month ago.


He had a car on lease, the leasing company say that they want to be paid the lease amount until the end of the term and don't want to stop the lease agreement now, or take the car back despite the leasing company belonging to the manufacturer.

My SIL cannot afford to pay the lease.

I have spoken to the leasing company and they want their money.

Is this fair?

[MitchT]

I find it had to believe that there isn't a mechanism in place for a situaiton like this. Surely the standard procedure is that the lease is terminated, the car is handed back and the exit penalty for early termination is paid from the deceased's estate.

[E3134]

That is what I would have thought too, the contract is complete. We don't want the car and there is no cash or desire to keep paying the lease.

However the leasing company say different.

I also suspect that the bank account from which the payments were made has been frozen,

[Rough101]

Usually this is dealt with as an early termination and the fees incurred held against the estate.

One of many horrible things to deal with.

[s111dpc]

I had a similar problem when my Dad passed away a couple of years ago and my Mum didn’t want to take the car on. I wrote to the company enclosing a copy of the death certificate stating that the the car not wanted and for them to collect it which they did within a couple of weeks and wrote off the remainder of the contract. Hope this helps.

[E3134]

s111dpc said:

I had a similar problem when my Dad passed away a couple of years ago and my Mum didn’t want to take the car on. I wrote to the company enclosing a copy of the death certificate stating that the the car not wanted and for them to collect it which they did within a couple of weeks and wrote off the remainder of the contract. Hope this helps.

Thanks for that.

I had better not state the name of the leasing company but they are are attached to a premium brand, I hoped that they would be reasonable. I called them because my sister in law is in no fit state, I expected a response as you enjoyed. I received a flat no, they wanted to take the monthly payments as they had in the past and they were not interested in having the car back early, we could not even have a settlement figure.

I have made some calls since posting. A friend has kindly agreed to take on the car and pay the 18 months payments that the lease has to run.

[MitchT]

Surprising if they're attached to a big brand. I did a quick Google and all the instantly recognisable leasing companies had the policy that I mentioned earlier - hand the car back under early termination rules. I'd sooner have organised some negative publicity for the company than try to find someone else to take it on.

[E3134]

I know rules are rules but it was the complete lack of empathy from that brand, a luxury car brand, that cheesed me off, the death in the family, mental breakdown of his wife and the fact that I was trying to sort out the problem.

[loskie]

Tell us the brand and we may help you find a way out of it.

Are you sure that the lease is with the brand itself?

[E3134]

Mercedes Benz, leasing company is Mercedes Benz Finance

Just been through their FAQs and death of the leaseholder is not mentioned other than a voluntary early completion.

Had a message from a solicitor who advises that the death of a party does not complete the contract and the leasing company can go for any other person including a guarantor and finally the estate.

To be honest, the outcome of someone taking over the payments and running the car is as good as it might get.

[essayer]

The contract will have terms related to early termination.

Worst case, the lease co will demand the full outstanding amount, which would be paid from the deceased’s estate. Some lease contacts discount the settlement amount, iirc VWFS was 45%

They may also have special provisions for this situation (I’d call again on Tuesday and speak to someone else)

Transferring might be an option, but you’d have to get them to agree it

[E3134]

essayer said:

The contract will have terms related to early termination.

Worst case, the lease co will demand the full outstanding amount, which would be paid from the deceased’s estate. Some lease contacts discount the settlement amount, iirc VWFS was 45%

They may also have special provisions for this situation (I’d call again on Tuesday and speak to someone else)

Transferring might be an option, but you’d have to get them to agree it

Thanks all, appreciate your thoughts, especially on this difficult matter.

[loskie]

https://www.mercedes-benz.co.uk/passengercars/fina...


Note the question "What is your bereavement process".

Good luck

[The Rotrex Kid]

You say lease, what finance product is it exactly? Personal or business?

There are a few different things that people call ‘lease’, not normally taken by personal customers and the get outs do vary.

IME, most finance companies have just taken back the car with no penalties after the death of the person named on the agreement.

[E3134]

loskie said:

https://www.mercedes-benz.co.uk/passengercars/fina...


Note the question "What is your bereavement process".

Good luck

Thanks, I think that is the key point.

In my naivety I had hoped that providing the company with the death certificate would have been enough to terminate the agreement, collect the car, it had done far less than the agreed mileage because he had been ill for the past year but that is not the point.

The only good thing to have come out of it is that the monthly payments will be covered by a family friend who can use the car until the end of the lease.

Must admit, I would not have thought of the consequences of a death mid-lease. Car getting written off maybe, but not the driver.

[Sheepshanks]

E3134 said:

Must admit, I would not have thought of the consequences of a death mid-lease. Car getting written off maybe, but not the driver.

If you're struggling to resolve thie - transferring the lease is often not allowed - then the above could be an angle worth pursuing. Is there any evidence that the person taking the lease was warned about this possibility? It's likelty to become an increasing problem as personal leases gain in popularity. Might be worth a letter to someone like the Financial Help person in the Telelgraph.

I will say (as a long term Merc owner) Mercedes are notorious for being generally unhelpful. Where some companies will back down in legal battles, MB will throw everything at it, and they simply refused to abide by the Motor Ombudsman's decisions.

[E3134]

Sheepshanks said:

E3134 said:

Must admit, I would not have thought of the consequences of a death mid-lease. Car getting written off maybe, but not the driver.

If you're struggling to resolve thie - transferring the lease is often not allowed - then the above could be an angle worth pursuing. Is there any evidence that the person taking the lease was warned about this possibility? It's likelty to become an increasing problem as personal leases gain in popularity. Might be worth a letter to someone like the Financial Help person in the Telelgraph.

I will say (as a long term Merc owner) Mercedes are notorious for being generally unhelpful. Where some companies will back down in legal battles, MB will throw everything at it, and they simply refused to abide by the Motor Ombudsman's decisions.

There is no evidence that there was any warnings given at the MB dealership, he was in his late 60s at the time so a warning could have been appropriate.

This may be a lesson to others of a similar age or those of you advising parents.