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Whatis payoff value

Updated: 9/21/2023
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What if the amount of insurance is greater than the payoff value of your home?

Well.........! It's common, Many people have more equity in there home than they owe on it.


When an auto is totaled and the insurer takes the auto and pays the insured the actual cash value of the car at the time of the loss this is an example of?

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If someone totals your car and leaves the scene is there a higher payoff for the vehicle?

No, the compensation (market or repair value) for the vehicle as determined by the policy guidelines remains the same.


How does the put option values fall and rise while call options values rise and fall as the rerlevant stock prices rises?

The Payoff i.e. profit for a Call Option is St-X where St is the market price at time t and X is the exercise price. Assuming that it is an American Style option where it can be exercised at any time, If St is significantly greater than the exercise price,X, (the agreed price to buy an option at) then if the option holder exercises it immediately they will be 'in-the-money.' This means it has a high intrinsic value which causes a rise in value for the option. The Payoff for a Put Option is X-St where X=exercise price and St equals market price at time t. If the market price increases the gap between X and St (Payoff or Profit) reduces or if X<St then they will be making a loss. This will mean it will have a low intrinsic value (value if exercised immediately) therefore the value of the option will fall.


You were the beneficiary of a car in a will but the car still has a lien?

You cannot will, what you do not own. You were only willed the EQUITY, in the car, if any. Here is what you do. find out what the car is worth, verses what is owed. Look online for like models, for sale. That will give you an idea of value. Compare that number, to amount of payoff. You will have to call the bank, on this. Payoff, and amount of money ewed on the loan, are usually different. The payoff, will usually eliminate a bunch of interest. Anyway, compare the two, and if it is worth more than owed, then you have equity, or cash value there. If it is worth less than owed, you may be better to walk away from it. This is something only you can decide. At least all this will give you the information you need, to make your decision.


If your car is worth 12K but you owe 20K on it will the insurance company pay it off if it is totaled in an accident?

You can only collect the fair market value or retail book value depending on the regulations as established by your state's insurance commissioner. The only way you can collect the difference between the Actual Cash Value of your vehicle and the Payoff is through GAP insurance. This is usually offered to you during the purchase of your vehicle but can be purchased later. At the time of purchase, the offer to purchase GAP insurance may seem like a ploy by the salesman to sell you something you don't need. However GAP insurance is a valuable option should this situation arise. GAP insurance is what its name implies, insurance coverage for the "GAP" between the fair market value of your vehicle and the payoff amount.


Will CarMax just out right buy my used vehicle?

Yes, as long as you can present a title with your name on it. If their offer is less than you owe, you may have to supply the difference to the payoff value. If their offer is more (or you have a lien release), then you can get a check for the full offer of the appraisal.