My friend is selling me his car and i am going to sign on title and loan with him?

Question

What steps can we take to make this legal. Or more so to protect both sides. What types of things should be included in the contract, and what step do we need to take to make it a legally binding contract? Input is very much appreciated. He's doing this to help me avoid a high interest rate. I'm just going to make the payments to his bank.

Help is appreciated,

Dan

Answer 1

If you are talking about going to his bank and getting a loan to pay off his car so he can get the title signed over to you, the bank will take care of all the paper work.  If you're talking about leaving it in his name, but you make the payments and then when it's paid off, he will sign it over to you, DON'T!

If you don't believe deals between friends can go south, you haven't been here reading questions very long.

Answer 2

Your friend is not very wise because this deal is full of potential problems. What if you decide to stop making payments? What if you wreck the car? Who has insurance and will it pay if you are the driver? He runs the risk of losing the car, having his credit ruined, being sued (if you have an accident and hurt someone), and losing your friendship.

Your friend needs to SELL you the car, legal and proper, and you need to get a loan and your own insurance.

Good luck.