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Author Topic: Selling a car to a friend  (Read 2102 times)

Offline zzfan

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Selling a car to a friend
« on: July 12, 2005, 01:38:52 pm »
Hi, new poster here with a question.  I am considering selling my '95 Z28 to a friend.  There are some special considerations.  He would like to pay me $800/month (instead of buying it outright).  My issues are:
 1) How to deal with ownership
     - would I keep it in my name until he has paid the full amount
     - if the ownership was changed to his name, how would the insurance work if there was an accident before he paid in full
 2) Insurance
     - if I kept the ownership, would he be able to insure it himself or would we have to do something where he was added as a driver on my insurance (Granted this is NOT much of an option)
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Mdxtasy

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Selling a car to a friend
« Reply #1 on: July 12, 2005, 01:43:03 pm »
I'd say pay in full or else the car really isn't his.  You must sign ownership over to the seller so he/she can get plates and insurance.  At that point, you don't own the car and all you have is the first month's payment.  I would not be willing to sign over a car to somebody (friend or no friend) without payment in full.

Why doesn't this person go get a loan for the purchase amount?  If he/she can't get a loan from the bank, why?  Bad credit?  Poor payment history?  If so, why would you agree to give him this payment plan?
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Offline zzfan

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« Reply #2 on: July 12, 2005, 01:59:10 pm »
Thanks for the quick response!  You're right, I would be a whole lot more comfortable getting the full amount up front.  The situation is that he was just in a major accident a few months ago (I have seen evidence that they are not considering it his fault) so he is just shortly going to find out if his hip has healed enough to drive again.  So, anyway the money will be coming as injury payments I guess.  I am leaning towards this situation being a big PITA, but on the other hand, he is offering a good price for the car and I don't need all the money right now and I would like to make the extra money rather than a bank.

(Message edited by ZZfan on July 12, 2005)
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Offline zzfan

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« Reply #3 on: July 12, 2005, 02:05:36 pm »
One thing I was considering was if a loan could be set up where the car was the security for the loan.  In this case, would a lien have to be registered against the car?
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Offline tenpenny

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« Reply #4 on: July 12, 2005, 02:19:50 pm »
If you want to protect yourself, you'd need a written loan agreemtent, and then find out how to register a lien.
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Offline ovr50

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« Reply #5 on: July 12, 2005, 02:25:12 pm »
If you two are friends now, I guarantee you won't be for long if you do this deal as proposed. Just say, sorry, I need payment up front. Do NOT do this "deal" as proposed. There are too many issues including, but not limited to,  why do you want to become a lender?
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Offline Snowman

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Selling a car to a friend
« Reply #6 on: July 12, 2005, 02:30:41 pm »
Depends on the type of “friend” is involved. Some I would trust with my life…others need to earn that trust. 99.995% of the time I trust no one. Get a legal document.
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Offline Snowman

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Selling a car to a friend
« Reply #7 on: July 12, 2005, 02:32:42 pm »
Ovr….I see the retard is lurking around again.
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Smainville

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Selling a car to a friend
« Reply #8 on: July 12, 2005, 02:43:14 pm »
If you value that friendship, no deal.
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Sterling

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Selling a car to a friend
« Reply #9 on: July 12, 2005, 02:57:41 pm »
Add another voice to the chorus. This isn't a good idea. What happens if it breaks down next month with a big repair bill? Will he be able to pay the bill plus the payment to you. Even if he is able, will he? Even if you register a lien etc., are you going to be comfortable repoing this car if he can't/won't pay?
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Offline zzfan

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« Reply #10 on: July 12, 2005, 03:07:15 pm »
These are ALL very excellent points.  Thanks for all the feedback!  Like I originally said, I am leaning towards just forgetting about it but I welcome any new insights.  If he doesn't/can't pay up front, I am considering having him do the "legwork" of coming up with a plan that suits me.  The point is well taken that I wouldn't feel very comfortable having to repo the car if he missed payments.  He claims "If I miss even 1 payment, the car is yours again" but still it would be a sticky situation.
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Offline ovr50

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Selling a car to a friend
« Reply #11 on: July 12, 2005, 03:23:05 pm »
"....coming up with a plan that suits me."

The plan that suits you should be a non-arms length deal as you would do with any stranger. Nothing less than that makes any sense to me.
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Offline articsteve

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Selling a car to a friend
« Reply #12 on: July 12, 2005, 06:21:28 pm »
It all depends on how much you think the car is worth and how badly you want to get rid of it?

For sure it must go in his name and on his insurance.

(Message edited by Articsteve on July 12, 2005)
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Offline bzborow1

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Selling a car to a friend
« Reply #13 on: July 12, 2005, 06:46:03 pm »
never sell a friend your car.  If it breaks down he'll blame you, and if he does he won't pay u.  If he's going to pay 800/month to you just tell him to get a damn car on lease and pay $350/month.  DONE.
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Offline JSCC

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« Reply #14 on: July 12, 2005, 11:21:53 pm »
The old chinese saying:

"Talking money, hurts feelings" specially with friends and relatives.
If things goes wrong, so does the relationship.
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Offline safristi

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Selling a car to a friend
« Reply #15 on: July 13, 2005, 10:47:31 am »
So don't sell it to an old Chinese friend....give it ta the bugger..then he owes ya forever..it will play havoc with his mind and you'll drink & partay FREE forever........
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Offline zzfan

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« Reply #16 on: July 13, 2005, 04:00:00 pm »
Hmmm... I like your thinking Safristi! But to answer a few questions, I wasn't planning on selling the car really until he asked.  To be quite honest, he was a roommate for a while (actually on 2 occasions) and I had problems getting the rent from him then.  Of course he never had any steady income at the time. So, basically I had already determined that it was a bad idea, but I was just looking for some confirmation.
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Offline AVToller

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Selling a car to a friend
« Reply #17 on: July 13, 2005, 05:05:33 pm »
Fool me once, shame on you. Fool me twice, shame on ME. Glad you've decided that it is a no-go.
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