I’m in a bind because I need to estimate the actual cash value of a 2011 Toyota Camry when repairs are quoted to be more than the value of the car. KBB private party value is $3,100-$5,000. Repairs were quoted at $5,600 (including exhaust, tires, brakes, stabilizer bar, fluids…). This is my brother’s old car, and because he has early dementia and his care depends on receiving Medicaid, we can’t just give it away. The state could consider that “divestment” of assets. We have to exchange fair market value for it. But what is that, when the quoted repair costs are so high? A young family member wants to try to do the repair himself, and so we need to figure out what sale value to use that is as low as possible, but that the state won’t argue is below market value. My brother was gifted another car in the meantime, so he doesn’t need to maximize the sale.
I found the guidance on diminished value for accident claims, but since the mileage is 182,000, the claim value always comes out $0. And claim value isn’t the same as market cash value anyway.
I doubt if you will get any replies that are of actual help here. I say call the Medicare help line and tell them it is undrivable ( which it sounds like it is unsafe ) and it just needs to be gone .
Not that you asked but does he really need to be driving as we have been involved with taking the keys away from someone with the same problems.
Depending on the appearance of the car you might be able to get $2000 to $2500. What will it take to make the car drivable? An exhaust repair? Was there a brake failure or just a recommendation to replace worn brake pads?
People who buy old cars don’t demand perfection: old tires, old fluids, stabilizer squeak etc. is not important, these things can be addressed in the future.
Let me know if there are any “free cars” that need minor repairs. These repairs are nothing compared to replacing an engine or transmission.
Seems like you could make the case the car is worth zero. Repairs are more than the private sale value of the car. I seriously doubt Medicaid would reject that argument.
When I had a car that needed a $2000 engine, the dealer told me a car without an engine is not worth much. Some years later with head gasket issues I sold it for $200 with new tires.
I agree, it is scrape value. Cost of repair exceeds market value fixed. Social workers know nothing about cars so stick to the math. Let a dealer buy it, give em $50 and they can sell it to your brother. You’re allowed to have a car but not one totaled out.
Medicaid and having to worry about divestment issues on a 2011 Camry, welcome to the American medical system I guess. Sorry you are having this difficulty, and more sorry you & your brother have to deal with this stubborn medical problem. If I had this problem, my first step, I’d ask my insurance agent for advice . They tend to know this kind of information. No harm to ask in any event.
He’s not driving anymore. He’s already got rid of this car, but it still needs to be got rid of at “market value.” Our mom gifted him her old car, and he hires a driver to get him between her house and his.
Thanks, all. Sounds like there’s no set method, so yes, I agree that Medicaid should accept the argument that it’s worth nothing, and a sale of $20 should be fair enough.
Are you going to call or email them? One of their people may have an answer for you. It’s possible you might find an answer in their FAQ if you haven’t looked there already.
Medicaid may not care if he gives away an old car that he can’t afford to repair.
However, a large repair estimate does not reduce the car’s value to zero, the car will still have resale value. If he wants to give the car to a relative who needs a car, that is ok but that is an act of generosity. People buy cars like this, repair them in a parking lot for very little, then sell for profit.
Try to find a used car for under $2000. The car below needs to have the engine replaced, it is not worth the asking price but still worth $300 to $500.
This one needs a head gasket to be replaced or engine replacement, a big project for a do-it-yourself mechanic. Retail price for this repair would be $3000 to $5000, still not a free car.
His Medicaid case worker at the county never returns my calls or emails, and has generally been more obstructive than helpful, so I don’t want to call her or tip her off to this issue. His last one would have probably told me don’t worry about it, but I don’t trust this one, so I’m trying to figure out the best way forward.
I see what you mean. Okay, I’ll search for cars around here that need similar work, take some screenshots, and try to use that as a justification. Maybe $300-500 is more accurate. Thanks!
If possible, I’d get a written trade-in estimate from CarMax or a registered dealer (even if it’s basically zero), a written estimate for the needed repairs, and a written quote from the nearest scrapyard. With all of that in hand, you should be able to sell it to the family member for the scrap value.
This person has a boss. You might try contacting them. Another route is to contact your elected representatives and explain the situation. If they can help you, will you vote for them in the next election and tell your family, friends and neighbors about the help you got? That’s why they do it. This should be your US Congress representative’s office. You probably will speak with an assistant, but they can help when the government lets you down.
To let you all know how this turned out, I have the written estimate for repairs from the dealer (about $5,600) and I got a written offer from a scrap yard (via carbrain.com) for $585. Carmax didn’t get back to me. So I plan to make a bill of sale for $585 and specify on the bill that repairs could cost up to $5,600. Medicaid may never even ask about it, but it’s better than risking a penalty. Thanks, all.
$585 is close enough to market value however, technically Carbrain is in the auto salvage business, the vehicle will be sold to an auto salvage yard to be used for the sale of used parts. Some auto salvage yards will resell vehicles that only need minor repairs.
If you had sold the vehicle to a scrap metal dealer as recommended, you would have received about $200, scrap metal is valued by the pound. A scrap metal dealer will destroy the vehicle, you could have a vehicle worth $5000 destroyed if you wanted.
An estimate for new tires and brake repairs can’t be used to establish market value of the vehicle, the vehicle is worth what others will pay for it. A set of premium tires can cost $2,000, the person who bought the car will probably be satisfied with a $800 set of tires and do-it-yourself brake repairs for $200.
Some people who buy/drive $3000 cars are better at managing repairs than others.
