Taking Over Payments
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Go Giants
Joined: Aug 2004
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From: PA
Taking Over Payments
If I want to sell my parents my wife's car and just want them to take over payments, is this an easy process, or do I need to pay off the car and then have them get a loan and pay me the payoff value?
Suzuka Master
Joined: Mar 2003
Posts: 6,897
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From: Austin, TX
This is what I told another member earlier today that was thinking about picking up payments:
Now considering that this is a little different case for you, I'd still go the legit route. It's the best move for all. Sell outright and transfer the title.
Originally Posted by kurt_bradley
Do NOT. I repeat: DO NOT take over someone's payments on a loan. There are a number of reasons behind this. For starters, insurance coverage. If the owner doesn't keep full coverage on it, the lein holder has the right (that it will exercise) to take out insurance on their own to cover the driver (and it costs a ton). Second, the owner has to trust that you will make all the payments on time and not diminish their credit. Third, if you wreck the car, you're both screwed. If you're driving a car that is owned by someone else that is financing the car and has to maintain full coverage on it, this will hinder your ability to insure the car (feasibly). The right way to do this would be to have the guy sell you the car outright, assume the loss on the negative equity, and then go about having you finance the car (or pay for it however you want). i could go on and on about this topic. Let's just say I shouldn't have to do much convincing.
This is coming from a guy that worked for Honda Motor Co in the Acura and Honda sales division (in management and finance) for nearly 6 years. Take my advice and buy this car legitimately. Otherwise, don't buy it. It's the best move for buyer and seller.
This is coming from a guy that worked for Honda Motor Co in the Acura and Honda sales division (in management and finance) for nearly 6 years. Take my advice and buy this car legitimately. Otherwise, don't buy it. It's the best move for buyer and seller.
Last edited by kurt_bradley; May 14, 2006 at 09:10 PM.
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Go Giants
Joined: Aug 2004
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From: PA
Originally Posted by badboy
Sell for a dollar to your parents, so no one has to pay tax.
Have your parents pay you via a check, use that money to pay off your loan.
Have your parents pay you via a check, use that money to pay off your loan.
Suzuka Master
Joined: Jan 2001
Posts: 5,349
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From: Lower Nazzie, Pa
I agree with Kurt.
It may be tempting for them to just take over payments considering it's your 'rents, but then again there's family members suing family members all the time on Judge Judy, so go the legit route.
As for sales tax, if your 'rents have to get a loan, then the sell for $1 won't fly (ie why would they need a loan if they're buying for $1?).
I'd say talk to the finance company or bank and see if they'll "roll over" the loan to your 'rents.
It may be tempting for them to just take over payments considering it's your 'rents, but then again there's family members suing family members all the time on Judge Judy, so go the legit route.
As for sales tax, if your 'rents have to get a loan, then the sell for $1 won't fly (ie why would they need a loan if they're buying for $1?).
I'd say talk to the finance company or bank and see if they'll "roll over" the loan to your 'rents.
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Originally Posted by badboy
Sell for a dollar to your parents, so no one has to pay tax.
Have your parents pay you via a check, use that money to pay off your loan.
Have your parents pay you via a check, use that money to pay off your loan.
You can decrease the value of the car a reasonable amount.
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Go Giants
Joined: Aug 2004
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From: PA
Originally Posted by JWhite1301
This is a good idea. No one at the State Tax office pays attention when a car sale comes through as one dollar!
You can decrease the value of the car a reasonable amount.
You can decrease the value of the car a reasonable amount.
Suzuka Master
Joined: Jan 2001
Posts: 5,349
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From: Lower Nazzie, Pa
Originally Posted by JWhite1301
This is a good idea. No one at the State Tax office pays attention when a car sale comes through as one dollar!
You can decrease the value of the car a reasonable amount.
You can decrease the value of the car a reasonable amount.
but there's a way around that...sell for $1000 and claim that the car needs repairs (you'd be cheating, but selling for $1 is cheating too and more likely to get you nailed).
But then again, these tactics only work if not getting a loan to pay for the car.
)
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Go Giants
Joined: Aug 2004
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From: PA
Originally Posted by phipark
Whiskers, you should be able to do a Transfer of Equity. Call your finance company and ask them about it. The will basically transfer the contract into your parents' names.
2 Legit 2 Quit.....
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