Can Anyone Take Over Payments on a Car Loan?by Timothea Xi
Modify or Get a New Car Loan<p>As personal finance website Financial Web notes, you can take two different paths in handing over your car -- and the loan payments that go with it -- to a different party. One path may be more beneficial than another for you or the new borrower.</p>
Loans.org recommends requesting that the lender confirm in writing that the obligation of the loan has been transferred.
Meet Car Loan Requirements<p>While the logistics of the new borrower acquiring a new loan may not seem to be your responsibility, the ability of the new owner to obtain a loan impacts how quickly you can get out of your own loan. Furthermore, if the new owner is a family member who may not be financially ready to pay down a large debt, the new car loan could impose undue hardship on him. So the <strong>new borrower must have financial means and equal or better credit</strong> than you do. </p> <p>The new borrower should be able to meet these <strong><a href="http://www.carsdirect.com/auto-loans/basic-car-loan-requirements">standard car loan requirements</a></strong> by furnishing the following documents<strong>:</strong></p> <ul> <li>Proof of residence</li> <li>Proof of identity</li> <li>Proof of income </li> <li>Proof of insurance</li> </ul> <p>Additionally, the new borrower needs: </p> <ul> <li>Credit rating -- preferably a good one, to obtain the lowest interest rates</li> <li>Down payment </li> </ul> <p>Once you secure a new or modified loan, you and the new owner must appear at a Department of Motor Vehicles office with your drivers' licenses <strong>to change the title on the car to reflect the new ownership</strong>. Write up a <em><a href="http://www.dmv.org/bill-of-sale-form.php">bill of sale</a></em> to facilitate this process. </p>
Once you've transferred ownership, cancel your existing car insurance policy with your insurance company. The new owner should obtain his own insurance for the car. If you will continue to drive the car, the new owner should add you to his policy.
- link Cars Direct: Can You Transfer an Auto Loan?
- link Financial Web: How to Transfer a Car Loan to Another Person
- link Autos: How to Transfer an Auto Loan
- link Loans: How Do I Transfer an Auto Loan?
- link Carroll Credit Center: Private Auto Loans - What You Need to Know
- link Car Loan 2: Private Party Auto Financing