I'm loaning a good friend $15k to pay off a car, what should I do besides get a contract? keep the title too?

Question

I'm loaning a good friend $15k to pay off a car, what should I do besides get a contract? Should I hang on to the title of the car too until it's paid off? They're a life long friend and the "trush" factor is a non-issue.

Answer 1

If all you do is hold the title with their name still on it then they can just get a duplicate from the DMV. Get the title put in your name then once it's paid in full transfer the title back to their name.

Answer 2

get ur name on that car

Answer 3

O.K. here's the way to do it........You won't need to keep the title, lock the title up, and all that other bunk everyone is saying. There is a spot on the title for the lien holder information.....that happens to be you now. Fill out the necessary information etc. make a copy if you want for your records. Now, they can not sell the vehicle until you sign off, as you're the lien holder now.

Answer 4

This is the best way to end up with an enemy!  Yes of course keep the title!  Lock it away somewhere they will never find it!  Chances are way better that you will get ripped, than for it to work out fine!  The "Trust" factor will ALWAYS come into play!   When this turns to sh  it...just remember, we told you so!!

Answer 5

Don't just keep the title he can always request a duplicate for twenty odd dollars at the DMV.  I would either have him sign a written contract detailing the deal and hold the title.  Or actually buy the car from him for the price of the pay off and let him pay you monthly.  But this is likely one of those deals worth contacting a lawyer about.  And I have to agree with a few of the others that life long friend or not this is the fast path to a life long enemy.  Good luck.

Answer 6

you should hold the title

Answer 7

Only a contract.

If you keep the title, you own the car. You will responsible for paying it off if your friend decides not too.

A contract is all you need if you want to be paid back with money and not be stuck with a car and payments.

Answer 8

That is a large amount of money to be loaning to anyone, regardless of any "trush" factor. (I'm assuming you meant to write TRUST).

Below is  a link to an MSN article about lending money to family members. Even though this is a friend, I believe this article will help you because it discusses why having a formal contract is necessary in this case.

And definitely get your name on that title as well. It will help you in the event that your friend suddenly becomes untrushworthy!