I am selling a vehicle to a friend; they know the condition of the car because they have been borrowing it for a couple of months.
They cannot pay me outright, I'm willing to finance for them for a couple of months until they can pay off the balance. If I do this, how is the title handled? I would like to have them put the car in their name, their insurance. But if they owe, I don't think I should give them the title.
2006-10-31 06:11:12 · 11 answers · asked by above_all 2 in Cars & Transportation ➔ Buying & Selling
Check with your Department of Motor Vehicles, selling varies in each state. Generally, you can provide them a bill of sell, a contract that specifys the terms of the sell, have it notarized if possible, but you keep the title until the vehicle if paid in full. Make sure the contract insists the car be completely insured too.
Good luck. Why can't they just borrow the money at a loan company and use the car as collateral? That way, you have the money and you're out of the deal!
2006-10-31 06:16:25 · answer #1 · answered by jack w 6 · 0⤊ 0⤋
Although the technical laws vary from state to state, the bottom line is this.... you hold the title, you assume the final liability for whatever happens. If your friend stops paying insurance, is in a wreck, etc., it all eventually comes back to you. Especially if you are financially more solvent than your friend is.... an injured party will always try to go where the money is. You could title the car in your friends name and file a lein if you want to draw up formal doccuments that follow all the regulations in your state, but you would have to probably hire someone. I sell cars for a living and am sometimes surprised at the mountain of paperwork necessay for certain leinholders in the various states. Although it probably wouldn't be a bad thing if you trust your friend and they are responsible, and you could just sign the title over after they pay you, you need to be aware of the liability you are taking on. Unfortunately, in the US basball isn't the national past-time anymore... it's litigation.
2006-10-31 06:27:41 · answer #2 · answered by Anonymous · 0⤊ 0⤋
Save the friendship. Have them go to the bank and get the money to pay for the car. And if they can't do that have a contract drawn up and signed by both parties.. Since you are not a legal lender if your friend drives off with the car after they get title and haven't paid you're SOL. Ask your insurance company, they will tell you whether or not your friend is able to insure the car while you have title until it gets paid off.
2006-10-31 06:19:23 · answer #3 · answered by ? 7 · 1⤊ 0⤋
Most states have a provision for a "Lien" on the title. Have them register the car, but show you as the Lien Holder. That way the car can't be sold or in any other way disposed until you sign off on the "Lien Holder" section of the title.
2006-10-31 06:20:25 · answer #4 · answered by Anonymous · 1⤊ 0⤋
Just put a lien on the title and hold on to it. Just fill out a bill of sale and contract so they pay their taxes. This way you are not liable in the event of an . Very simple to do. It is done all the time. Just contact your state's DMV
2006-10-31 13:10:02 · answer #5 · answered by typhon1991 3 · 0⤊ 0⤋
Your right you should retain the title until they pay.
But be careful, if they do something dumb with the car, then it'll come back to the title holder.
Easiest way is to have them take a small loan, and give you the cash.
2006-10-31 06:14:00 · answer #6 · answered by Shockey Monkey 5 · 0⤊ 0⤋
i bought my first car that way through a friends mom..she wrote up a bill of sale we both signed, i set up monthly payments with her and once i paid it off she signed over the title to me. now i work for in insurance company and dont worry about the insurance..they need to put the car on there insurance and you can take it off of yours. and once they pay it off they can take the title to the local courthouse and transfer the title. no worries..
2006-10-31 06:21:19 · answer #7 · answered by yourmygoodfeeling 3 · 0⤊ 0⤋
PLEASE KEEP THE CAR AND THE TITLE....LET THEM PAY YOU OFF BEFORE YOU GIVE THEM THE CAR...THIS IS SIMPLY A GOOD BUSINESS PRACTICE. THEY CAN NOT GET INSURANCE ON THE CAR IF ITS IN YOUR NAME...WHAT HAPPENS IF THEY HAVE AN ACCIDENT AND ITS STILL IN YOUR NAME.....YOU ARE ABSOLUTELY RIGHT...YOU SHOULD NOT GIVE THEM THE CAR...JUST TELL THEM YOU VALUE THEIR FRIENDSHIP BUT YOU NEED THE MONEY UP FRONT BEFORE THEY TAKE THE CAR...
2006-11-02 13:45:32 · answer #8 · answered by Pamela L 1 · 0⤊ 0⤋
Your setting yourself up for a huge problem, you should never mix business with friends. If the car goes "out" on them, they are going to want their money back and you will be out both!
2006-10-31 06:20:26 · answer #9 · answered by someoneoutthere 5 · 1⤊ 0⤋
You keep the title and give that to them when it is paid off.
2006-10-31 06:19:02 · answer #10 · answered by Anonymous · 0⤊ 0⤋