How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask Richard Your Own Question
Richard
Richard, Attorney
Category: Legal
Satisfied Customers: 53965
Experience:  Attorney with 29 years of experience.
17027240
Type Your Legal Question Here...
Richard is online now
A new question is answered every 9 seconds

I am trying to sell a car that I am making payments on. The

Customer Question

I am trying to sell a car that I am making payments on. The man that wants to buy it suggested to form our own contract and get it notarized. The contract will relinquish me of all responsibility of the car ( payments, insurance payments, damage, traffic violations, etc) all while leaving it in my name. He will transfer money to me every month for the expenses. I am curious if this is a legal/good option?
Submitted: 1 month ago.
Category: Legal
Expert:  Richard replied 1 month ago.

Hi! My name is Richard & I will be helping you today! It will take me a few minutes to type a response to your question. Thanks for your patience!

Expert:  Richard replied 1 month ago.

Is there a reason this man can't simply purchase the car from you by getting independent financing? Thanks.

Customer: replied 1 month ago.
I haven't asked. He just seemed to want to keep things in my name and take over payments
Customer: replied 1 month ago.
He actually did tell me he already has to current auto loans and doesn't want another in his name.
Expert:  Richard replied 1 month ago.

Thanks for following up. I would not suggest you do this as it's fraught with peril for you. Although you may have a contractual relationship with him, this would not be binding on any third parties, so if you would end up with a situation where a third party files a claim against you as the owner due to something he's done, you may have a claim against him, but if he's broke, you'll end up on the hook. You simply don't want to leave a car and a loan in your name when you don't have possession of the car. Your insurance company could deny coverage if it discovers he's the actual owner; if he totals the car and the salvage value is less than what is owed, you'll be on the hook for the loan; if he causes a bad accident in excess of the insurance coverage and/or where his acts are such that the insurance company denies the claim, you're stuck. If he's going to buy the car, he really needs to get a loan, take title, and get your loan paid; otherwise, I would suggeest you sell it to a more conventional buyer.

Thank you so much for allowing me to help you with your questions. I have done my best to provide information which fully addresses your question. If you have any follow up questions, please ask! If I have fully answered your question(s) to your satisfaction, I would appreciate you rating my service as Good or Excellent (hopefully Excellent). Otherwise, I receive no credit for assisting you today. I thank you in advance for taking the time to provide me a positive rating!

Customer: replied 1 month ago.
even if we both sign a notarized contract that relinquishes my responsibility of the vehicle, I can still pay the price for any damage to it?
Expert:  Richard replied 1 month ago.

Yes, because it's only binding between the two of you. If there is a third party claim, they can sue you as the owner. You may have a claim then against your buyer, but if he's broke...which I suspect or he would be able to get his own loan to buy this car....then you're left holding the bag.

Customer: replied 1 month ago.
OK I understand, thank you. What other options might you recommend.
Expert:  Richard replied 1 month ago.

First, I would suggest you find a conventional buyer that can get independent financing. Second, if you really want to do a deal with this guy, I would act as the lender and transfer title to him and have him issue you a promissory note and security interest in the car. The problem with this is that it's likely to trigger your lender calling your loan. Alternatively, you could co-sign a note for him with the note and security agreement. At least that way, you wouldn't be on the title. But, this is a poor second choice.

You're very welcome. It's been my honor and privilege to help you with this. If I can help you in any way in the future, I'll be happy to help. For easy access, my bookmark is: www.justanswer.com/law/expert-legalbeacon/ . Or, simply request “Richard only” in the first line of your question.

Related Legal Questions