Title of new car

[GusGus77]

Either I wrote wrong or perhaps you misread or I didn’t explain well (the latter is probably the case.) We would not ever have just him on the loan and me on the title. At the moment, it will either be both of us on the loan or just him. My concern is if he is the one on the title, does it matter that I am the primary driver on the car? (100% whoever takes out the loan must have name on title.) We are in the process of the loan, so still need to decide that. If it is just him on the title, he will take the loan. If it is me on the title, we both will. So my question is, is it problematic that my name is not on the title when I will always be the one driving the car?
You mentioned something about "the loan"...

The bank may actually require his name to be on the title if his name is the one on the loan and yours is not. Every institution has its own rules on this, but having a name on a title of a financed vehicle that is not on the loan is a BIG risk for the bank (if not done properly). I literally deal with this every day.

In theory if your husband takes out a loan and your name is on the title and not his...... If he does not make his payments, the bank cannot repossess YOUR car.

Also, in theory if your husband takes out a loan and your name is not on the title and not his... You can sell YOUR car and do whatever you please with the cash.

This is why the bank may balk at even making the loan if they know this is the plan. Most likely if they do make the loan, they will want you to be on the loan with him. If 2 names are on the loan and only one of them is on the title... the bank is covered so they should not care one bit about that. There are documents in place that will allow a person to be on the title and not the loan (along with a borrower being on the title). There is this thing called a "security agreement" they will make you sign to acknowledge that your name is on a title for a car financed by somebody else and if that person fails to meet their obligations the bank CAN take your car and a repo will most likely reflect on your credit.

The bank will most likely absolutely hate the idea of him taking out the loan for a car and his name not being on the title only yours. Usually the only way this happens with us is if somebody "just does it" and doesn't tell us ahead of time. In which case, the bank will make probably make you sign a security agreement and frown upon it heavily. If the bank is not nice, they could either make you go back and re-title the car with his name on the title. In Illinois that will cost you another $50. (IL titles are not cheap). If the bank wants to be really mean, they may just call the loan (although I have never seen it actually happen). The bank may also make him refinance the car with your name on the loan, or they may convert it to a non-collateralized loan and hike the interest rate.

Long story short... don't try to be sneaky and have him take out the loan and then title the car the way you want. The bank WILL find out and they will NOT be happy, and it will most likely cost him a lot of money. Be up front with your loan officer if you go directly through the bank. If you are working with the dealership's finance department let them know your plans ahead of time so they can present the bank with the proper information or the bank will be very unhappy with both of you.... and it will cost him money.

There is also the insurance aspect.... the insurance company may have their own requirements when it comes to financed vehicles and titles as far as how the names appear on the title.

Moral of the story.... just put both of your names on the title. (assuming the bank will allow you to sign a security agreement and be on the title with him) or put both of your names on the loan. We see it all the time where one spouse has 0 income and is on the loan with the other spouse.

If you were not financing the vehicle... you guys would be welcome to do whatever you want, but when the bank's money is involved they will have a lot of say in what you do.

 

[Stratman50th]

So my question is, is it problematic that my name is not on the title when I will always be the one driving the car?
You mentioned something about "the loan"...

The car title denotes ownership. It has nothing to do with who the primary, or any driver is. Say you buy a car for your adult (over 21) child. You wouldn't title the car in their name? Ok, maybe some people would, but it would still be yours as far as ownership is concerned. If you don't own the vehicle outright, there would still be a lienholder on the title until it's paid off.
EDIT: Since there's nothing I know of that would prohibit a child from owning property, I suppose you could put a minor child on the title also. You don't have to be a licensed driver to own a vehicle, just to drive it.

 

[china mom]

So does it make a difference that “my” new car (since I will be the one primarily driving it) has the title in DH’s name and then “his” car has the title in my name? So in theory, DH owns the car I will be driving 99% of the time?

It makes no difference. Due to he fact that I happen to be R&D for my family and also the one negotiating and getting the financing, up until recently all the cars ended up in my name alone. Even the ones that DH and DS drive pretty much exclusively. When I went to add DS to the auto policy, my insurance agent suggested adding him to the least expensive policy - not to the car he actually drives and that covers us.

I insisted DH be on the title of our most recent car purchase after realizing what a hassle it is when one spouse dies. my parents were joint on everything they owned except one car - which had dad as the sole owner. My mother had to open an estate and probate the will just for the one vehicle. DH and I are in the same situation. If I dies he will have to open a estate for the three cars that are still only in my name so we are hoping I outlive the cars.

 

[Stratman50th]

If I dies he will have to open a estate for the three cars that are still only in my name so we are hoping I outlive the cars.

You should be able to change the title to add his name to it as well.

 

[kymom99]

It makes no difference. Due to he fact that I happen to be R&D for my family and also the one negotiating and getting the financing, up until recently all the cars ended up in my name alone. Even the ones that DH and DS drive pretty much exclusively. When I went to add DS to the auto policy, my insurance agent suggested adding him to the least expensive policy - not to the car he actually drives and that covers us.

I insisted DH be on the title of our most recent car purchase after realizing what a hassle it is when one spouse dies. my parents were joint on everything they owned except one car - which had dad as the sole owner. My mother had to open an estate and probate the will just for the one vehicle. DH and I are in the same situation. If I dies he will have to open a estate for the three cars that are still only in my name so we are hoping I outlive the cars.

In my state you can transfer title to relatives for free. Well, there may be a small fee but it’s not much.

 

[china mom]

In my state you can transfer title to relatives for free. Well, there may be a small fee but it’s not much.

You can in Maryland as well as long as the owner is alive. The problem was that Dad died and the car was still in his name. Mom had to open an estate just to probate the car.

As to adding DH, yes, there is a small fee - which adds up with three cars. Since one of the cars is a 2007, I am counting on outliving that one at least.

 

[RamblingMad]

It matters if you get divorced.

 

[kymom99]

You can in Maryland as well as long as the owner is alive. The problem was that Dad died and the car was still in his name. Mom had to open an estate just to probate the car.

As to adding DH, yes, there is a small fee - which adds up with three cars. Since one of the cars is a 2007, I am counting on outliving that one at least.

Yes we had the same thing happen when my dad died. The truck was in his name only. Mom didn’t drive but the car was in both names.

 

[tvguy]

It matters if you get divorced.

Or if one of you dies.

 

[barkley]

on the subject of the loans-even if one spouse has no income they can still be listed as a co-borrower on credit applications. the advantage to this is in the event of the death of the other spouse the survivor can (if they are financially able) continue paying off the vehicle (or home or whatever) under the preexisting terms of the loan. if the spouse is not then the lender can call for immediate settlement of the loan. we discovered this when a family member passed whose practice was for the husband to have all credit cards and loans in his name w/ the surviving wife (on the credit cards) as only an 'authorized user'. upon death the lenders said either she could apply for credit/loans under her name and get the debts transferred to her at the then prevailing interest rates otherwise the debt would be handled through the probate court to be paid in full (or in the case of secured debt-the repossession/foreclosure process would be initiated).

 

[tvguy]

All of our cars are titled in my name. We had one that was titled in my husband’s name - in order for the dealer to get to my drive out price, we had to finance a small portion of it. Since we financed in my husband‘s name, they required the title to be in his name. When you pay cash, you can title how you wish.

In California you don't get the Title until the loan is paid off. The bank gets the title. So you aren't on the title until you pay off the loan.

 

[tzolkin]

So my question is, is it problematic that my name is not on the title when I will always be the one driving the car?
.

It should not make any difference who is driving what vehicle. We just received all our registration renewals in the mail so I looked at the names on them. I "own" both of my daughters' vehicles. I co-own my husband's vehicle. And apparently my husband owns the vehicle that I have been driving for the last 6 years. I honestly would not have known without looking at the paperwork who was listed for what vehicle. I think it probably just depended on what vehicle we were trading in and transferring plates when we initially registered them.

The death scenarios people have mentioned are the only issue I can see. I would assume having a will would make that transition easier, but this is now making me think perhaps we should have two people listed.


Not sure how car loans differ from mortgages, but my husband and I own two houses (both listed on the deed). He solely has the mortgage for our home and I have the mortgage for our rental house.

In California you don't get the Title until the loan is paid off. The bank gets the title. So you aren't on the title until you pay off the loan.

You don't receive the physical title until the loan is paid off, but you list what name will be on it at the time of purchase. I'm assuming that's what that poster meant.

 

[tvguy]

Could be just old wive's tale, but I've always understood you put cars in a single name and your house/property in both names so that in the case of an accident, you can't be sued and lose your home because your spouse is also on the deed.

In Community Property states it doesn't matter. They can go after any property that you have an interest in. However, that should never be an issue if you are adequately insured.

 

[tvguy]

Not sure how car loans differ from mortgages, but my husband and I own two houses (both listed on the deed). He solely has the mortgage for our home and I have the mortgage for our rental house.

My former next door neighbors had a horrible financial mess based on how they had their home and vehicle loans set up.
He was on the loans for their 5th wheel, Jeep, Pickup and Boat. She was on the house. He lost his job and they decided to walk away from the house, and keep the 5th wheel, Jeep, Pickup and Boat. They tried to qualify for all kinds of mortgage relief programs and bankruptcy, but because HE wasn't on the mortgage, and because SHE wasn't on the vehicle loans the loss of his income had no impact on the mortgage. She had the income to pay the mortgage. And I guess because of their previously challenged credit, their mortgage was set up so that the lender could garnish her wages for the payment.

 

[barkley]

I would assume having a will would make that transition easier, but this is now making me think perhaps we should have two people listed.

didn't help with the estate we dealt with. had to deal with the dmv in that state and to transfer title there we had to wait 40 days during which we had to keep the car insured which was a challenge b/c since we were not owners our insurance wouldn't insure it and technically the decedent's insurance on it should have terminated on the date of their death. thankfully the car insurance had been prepaid for a few months and we had friends with property we could store it on so it sat until it could be transferred at which time the insurance company was told 'oops we spaced on notifying you that x passed 2 months ago'.

 

[flyingdumbo127]

Gus Gus, (cute Disboard name) I'm sorry that a new car is needed for not ideal reasons. Prayers.

 

[cobright]

His name should be on title if he’s the one financially responsible for the car. Beyond that, it makes not even a mote of difference.

 

[Kathryn Merteuil]

Either I wrote wrong or perhaps you misread or I didn’t explain well (the latter is probably the case.) We would not ever have just him on the loan and me on the title. At the moment, it will either be both of us on the loan or just him. My concern is if he is the one on the title, does it matter that I am the primary driver on the car? (100% whoever takes out the loan must have name on title.) We are in the process of the loan, so still need to decide that. If it is just him on the title, he will take the loan. If it is me on the title, we both will. So my question is, is it problematic that my name is not on the title when I will always be the one driving the car?
You mentioned something about "the loan"...

As far as the bank is concerned, we honestly do not care who drives the car as long as:

A. Our lien is on the title
B. You have full coverage insurance that is valid
C. Somebody on the loan is on the title and if somebody on the title with them is not on the loan, a security agreement is on file.

As far as how the car is titled and somebody else driving it primarily.... I would HIGHLY suggest you reach out to your insurance company. I suspect each company has their own rules. I CAN say as a lienholder, that we get calls from insurance companies about total loss claims every day (too darn many per day).... they will often ask "how do the names read on the title?"

In your state Illinois, when the title is issued...and yes it will be issued eventually (Illinois is notoriously slow), the ownership is "AND" if there are 2 names on the title. That purple piece of paper will sit in a filing cabinet at the bank until the car is paid off at which time it will be sent to the owner generally. (of course there are exceptions when it involves POA's with trade ins, refi's, insurance claims etc...)

Yes, many of these other states, a title will not print until the car is paid off, however an electronic title does "exist" in most cases. Heck, Michigan will send the title directly to the owner and let them keep it (it will just have a lien printed on the front), although now it seems they are moving to electronic as well. Illinois however, does NOT participate in the electronic title programs, and they have PAPER titles.. there are NO exceptions to this in Illinois. The title WILL be paper.

 

[cvjw]

In California you don't get the Title until the loan is paid off. The bank gets the title. So you aren't on the title until you pay off the loan.

Yes, I understand how titles and loans work. My point still stands. Since the dealership required us to finance $5000 to get to the drive out price we wanted, the title had to go into my husband’s name since the loan was in his name. All of our other cars are titled in my name because we pay cash for cars.

We paid the $5000 off as soon as the loan was set up and got the title a couple weeks later. It was in my husband’s name because the loan was in his name.

 

[tvguy]

Yes, I understand how titles and loans work. My point still stands. Since the dealership required us to finance $5000 to get to the drive out price we wanted, the title had to go into my husband’s name since the loan was in his name. All of our other cars are titled in my name because we pay cash for cars.

We paid the $5000 off as soon as the loan was set up and got the title a couple weeks later. It was in my husband’s name because the loan was in his name.

I think an Estate Attorney would advise all you loans and titles should be in both names.