Selling car while going through a separation

Bristoldjm

Myself and my wife are separated and she has told me that she has filed for divorce but I've received no letter or paperwork yet. I bought a car a year ago while we were married. The money I used was my own plus a personal loan I took out. She has been the main driver of this car and pays for the majority of the petrol and tax although I pay for all of the insurance.

Last week, we agreed to sell it, pay off the loan and split the remainder 50/50 to enable us to buy two smaller cars. I contacted a garage who will sell it for us and the car is currently on their forecourt.

Today, she is saying I can't sell it because it's a marital asset so needs to form part of the divorce settlement. She is demanding I get it back from the garage.

Am I legally allowed to sell the car or do I need her permission? What will likely happen if I go ahead with the sale and stick to our original plan? Could I be found to have breached anything (I've received no divorce paperwork so nothing has told me not to do it)?

Thanks

DavidP24

I imagine worst case scenario is that any surplus income would be accounted for as would you giving her half the money.

I suspect she just wants the car back, it is a depreciating asset and should be sold as soon as possible. It is entirely unfair that you are funding her free transport and insurance.

Sell it and give her half the excess, less any loss from cancelling the insurance, or have her take over her own insurance payments if the policy is only for her.

Kynthia

At the moment you have a marital asset and a marital debt. If you sell the asset, pay off the debt, and split the remainder then there is no difference really and the net balance is the same. What you shouldn't do is go on a spending spree to increase your debts and reduce your assets or try to hide or give away assets in order to have less to split.

Even though it will be considered a marital asset should you divorce, the car is owned by you so legally you can sell it. If you sold it for much less than it was worth or kept all the proceeds then that could affect how a judge viewed the balance of marital assets and how to split them.

DavidP24

The other option is to sell the car to her, IF she has the funds.

The benefit of that would mostly be goodwill, you would avoid the dealers commission

Any delay weakens your position, the value of the car is less every day and you continue to service the debt.

If it were me I would want shot of the insurance cost immediately, I would cancel the DD and give her the details to make her own payments to the policy.

I would want a fair price for the car based on an independent valuation based on the actual condition of the car.

I once paid off a car loan and the redemption figure was very close to what it would have been to pay off the loan normally.

A benefit to you is that if you continue with the loan it is good for your credit record as long as payments are made on time, however, it may affect your ability to get a mortgage if numbers are close.

What will be messy is that she may feel she owns half the car already, when really that only applies if she own half the debt.

So if the car could be sold for £8000 less £1600 commission you get £6400, the outstanding loan payments/redemption amount to £4400, you get £2000 to split between you.

She could offer you £6200, being the £8000 less half the commission and £1000 proceeds she would have had, so she takes the hit on the commission and you save £800, it is virtual money as she would never have it anyway. You agree to maintain payments or pay off the £4400,

The benefit to her is that she does not have a car finance debt to service, which could make her more successful in a mortgage application if things are tight.

The downside for you and her of a car finance agreement is that it may affect your own mortgage offer if you are perceived as to not be able to afford both repayments.

The important thing is that you sell or make this agreement within a week and that you get a legal agreement regarding payments and ownership of the car.

The other benefit for you is that you get a price close to valuation, no haggling.