I'm currently financing a truck, however I have been trying to sell it as I'm in need of something different. A close friend of mine has agreed to take over my payments for me, but I have a question about insurance. Because of some past credit problems my friend is unable to get a loan for himself, so this works out well for him as I said it would be fine if he just took over my payments. It's not a big deal if the registration is still in my name as I trust him. Our question however is how to deal with insurance. I obviously won't want to have it insured for me anymore since I won't be driving. What I'm not sure of is whether he will be able to get insurance put on it since the registration is in my name. Will I have to add him as a driver on my insurance and have him pay me directly, or will insurance companies allow him to insure the vehicle even though it's not in his name?
2007-06-01 10:12:43 · 7 answers · asked by Anonymous in Business & Finance ➔ Personal Finance
The truck is in your name and you have a loan on it. The insurance will have to be in your nemw also. Both the law and your insurance company will require it to be that way.
Additionally, you are putting yourself at significant financial risk by doing this transaction. If you allow this person to use the truck while in your name, any accident or other violation such as a parking ticket or a speeding ticket by camera would be charged to your record, not his.
2007-06-01 10:19:00 · answer #1 · answered by fideux 4 · 0⤊ 0⤋
Wow, lots of things to consider here. It depends to a great extent on the laws of your state of course. Insurance companies don't care for the most part, and will take your money to put a policy on any vehicle you can supply information about, make, model, year, mileage and VIN is all it takes for the most part.
The problem really will be the lender. They are probably requiring some type of full coverage and would want it in your name since their contract is with you. They also may not like it if you have added another driver to your policy.
Have you really stopped and considered all the consequences of leaving the truck in your name? Sure, you're best friends now, but a quick read through here will turn up a dozen horror stories about 'friends' not being 'friends' any more due to a car deal like what you are considering.
For example, your truck is left if a no parking zone, or even in a parking mall where your friend has left it beyond the time allowed, and it gets towed. Only YOU can get the truck out of impound. Guess where the ticket gets mailed from the red light camera?
If you really trust him that much, I'd suggest you co-sign for a loan for him, and put everything in his name. Add your name as legal owner along with the finance company that carries him. As long as he makes payments, no problem. If he quits, they come after you, but you're no worse off than you are now, and could probably get the truck back upon getting the payments caught up.
2007-06-01 13:44:31 · answer #2 · answered by Anonymous · 0⤊ 0⤋
You can add him as a driver on your policy. Will probably have to make up some kinda story, that he's a cousin and he lives with you.
Keep in mind that you are still legally responsible for the car. Meaning, no one is going to come after him for money if he:
A. Doesn't pay the payments.
B. Damages property above what your insurance company covers.
C. Commits a vehicular felony (runs over an old lady).
The legal and financial burdons still remain with you. I would attempt to find a secondary lendor (and find him a cosigner, don't you consign) and try to get out from under this truck.
2007-06-01 10:19:35 · answer #3 · answered by Tim 2 · 0⤊ 0⤋
Bad move, the truck will still be in your name so you ultimately are responsible for anything that happens, and the insurance since it is in your name will be held by you. Would try to sell the truck outright. If he misses payments, guess what you are ultimately responsible also. Too big a gamble to take
2007-06-01 10:18:52 · answer #4 · answered by Pengy 7 · 0⤊ 0⤋
Visit a vehicle coverage agent & ask him - There should be some way, in view that you are no longer the primary man to do that. My vehicle coverage enterprise, State Farm, covers me for an afternoon or 2 whilst I get a brand new vehicle, till I get time to get the data to them.
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2007-06-03 01:53:24 · answer #7 · answered by Anonymous · 0⤊ 0⤋