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Leasing a vehicle for a family member
mustbesavvy
Posts: 16 Forumite
in Motoring
I've had personal lease cars for a number of years now and this has worked out very cost efficient for our family.
My parents have an aging vehicle they own which has cost me a fair amount in the last year in repair bills, and I'd like the assurance of safety and cost for them, so was looking at a sensible lease option for them, but there are a few challenges I'm trying to get some insight on. The first thing is that, while I'm going to pay for it anyway, my parents won't get finance approved for the vehicle themselves. So to simplify things I just thought I would take out the lease agreement in my name. From what I understand from a broker I spoke with and a bit of research, the address for the lease agreement must match the insured address. My parents don't live with me, so that doesn't comply. There's also the complexity on insurance, but I can work around that by insuring myself and dumping them on the policy.
What I find odd is that there has to be plenty of examples where people have a car at a different address (think someone with multiple properties). I have no intention of effectively committing finance or insurance fraud, but there has to be a plausible resolution to this where I can lease a car that resides at a different address.
Does anyone have any experience or insight into this?
Many thanks
My parents have an aging vehicle they own which has cost me a fair amount in the last year in repair bills, and I'd like the assurance of safety and cost for them, so was looking at a sensible lease option for them, but there are a few challenges I'm trying to get some insight on. The first thing is that, while I'm going to pay for it anyway, my parents won't get finance approved for the vehicle themselves. So to simplify things I just thought I would take out the lease agreement in my name. From what I understand from a broker I spoke with and a bit of research, the address for the lease agreement must match the insured address. My parents don't live with me, so that doesn't comply. There's also the complexity on insurance, but I can work around that by insuring myself and dumping them on the policy.
What I find odd is that there has to be plenty of examples where people have a car at a different address (think someone with multiple properties). I have no intention of effectively committing finance or insurance fraud, but there has to be a plausible resolution to this where I can lease a car that resides at a different address.
Does anyone have any experience or insight into this?
Many thanks
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Comments
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mustbesavvy wrote: »I've had personal lease cars for a number of years now and this has worked out very cost efficient for our family.
My parents have an aging vehicle they own which has cost me a fair amount in the last year in repair bills, and I'd like the assurance of safety and cost for them, so was looking at a sensible lease option for them, but there are a few challenges I'm trying to get some insight on. The first thing is that, while I'm going to pay for it anyway, my parents won't get finance approved for the vehicle themselves. So to simplify things I just thought I would take out the lease agreement in my name. From what I understand from a broker I spoke with and a bit of research, the address for the lease agreement must match the insured address. My parents don't live with me, so that doesn't comply. There's also the complexity on insurance, but I can work around that by insuring myself and dumping them on the policy.
What I find odd is that there has to be plenty of examples where people have a car at a different address (think someone with multiple properties). I have no intention of effectively committing finance or insurance fraud, but there has to be a plausible resolution to this where I can lease a car that resides at a different address.
Does anyone have any experience or insight into this?
Many thanks
But thats effectively what you'd be doing?
Why not take out a personal loan and buy them a car outright. All problems solved.
Some very fresh cars available for not a big amount of money0 -
Why do you think that?
Because in leasing you are committing to retaining control of the vehicle at your registered address and committing to maintaining it to a certain standard.
Thats not whats happening here. Probably not "financial fraud" per se and its not like the "fraud police" are going to turn up on your doorstep and arrest you, but i cant see the leasing company being happy with it.
And the insurance could be a little chancey too. Effectively thats fronting, because the policy holder isnt the main driver or the keeper of the vehicle, and the vehicle isnt kept at the policy holders address.
GAP insurance too - cant see them being ecstatic about the idea, so the choice might be to run without it, or risk having them not pay out.
Seems like an awful lot of risk should the O/Ps parents, god forbid, crash it when on holidays to the lake district or whatever and write it off.
Get a cheap loan and buy them a close to new car under warranty.
Hyundai do 5 year warranties and KIA 7 so it doesnt even have to be that new.0 -
Because in leasing you are committing to retaining control of the vehicle at your registered address and committing to maintaining it to a certain standard.
Thats not whats happening here. Probably not "financial fraud" per se and its not like the "fraud police" are going to turn up on your doorstep and arrest you, but i cant see the leasing company being happy with it.
And the insurance could be a little chancey too. Effectively thats fronting, because the policy holder isnt the main driver or the keeper of the vehicle, and the vehicle isnt kept at the policy holders address.
GAP insurance too - cant see them being ecstatic about the idea, so the choice might be to run without it, or risk having them not pay out.
Seems like an awful lot of risk should the O/Ps parents, god forbid, crash it when on holidays to the lake district or whatever and write it off.
Get a cheap loan and buy them a close to new car under warranty.
Hyundai do 5 year warranties and KIA 7 so it doesnt even have to be that new.
They don't have to be.
It's not the norm but unless the OP is being dishonest and there's nothing to suggest they are. Then it's not fraud.0 -
They don't have to be.
It's not the norm but unless the OP is being dishonest and there's nothing to suggest they are. Then it's not fraud.
So the O/P would be- Taking out a second insurance policy solely for the purposes of doing this
- Being the policyholder on that policy
- Putting his parents on it
- He wouldnt be the main driver
- It wouldnt be kept at his house
And what would the "honest" reason be for doing it - "i'm trying to fiddle the leasing rules"?
If there was a claim made against the policy, i think that would come under an awful lot of scrutiny.
Combined with the fact the leasing company wont accept it anyway
And any GAP insurance wont cover it.
Would you be happy to try to weave a path through all that and hold water IF there was a significant claim made?0 -
So the O/P would be
- Taking out a second insurance policy solely for the purposes of doing this
- Being the policyholder on that policy
- Putting his parents on it
- He wouldnt be the main driver
- It wouldnt be kept at his house
And what would the "honest" reason be for doing it - "i'm trying to fiddle the leasing rules"?
If there was a claim made against the policy, i think that would come under an awful lot of scrutiny.
Combined with the fact the leasing company wont accept it anyway
And any GAP insurance wont cover it.
Would you be happy to try to weave a path through all that and hold water IF there was a significant claim made?
None of which makes any difference.
I've seen a disqualified driver who is the policy holder for a vehicle he couldn't driver. It was listed under persons entitled to drive: Any licenced driver, except the policy holder.
What you think is a massive problem isn't dissimilar to a company car drivers who's company lease the vehicle.
The person responsible for taxing and registering it isn't the owner.
They're not the driver.
They may not even be on the company's insurance.
Someone else drives it and it's kept at their home address.
Are you suggesting all company car drivers are dishonest?0 -
Blimey, what have I started. Was just trying to better understand if there was a sensible route to being able to lease a car for my parents, openly, honestly, legally. Not sure this was the site I should have come to!
Clearly I'm a massive fraudulent criminal!0 -
None of which makes any difference.
I've seen a disqualified driver who is the policy holder for a vehicle he couldn't driver. It was listed under persons entitled to drive: Any licenced driver, except the policy holder.
What you think is a massive problem isn't dissimilar to a company car drivers who's company lease the vehicle.
The person responsible for taxing and registering it isn't the owner.
They're not the driver.
They may not even be on the company's insurance.
Someone else drives it and it's kept at their home address.
Are you suggesting all company car drivers are dishonest?
Not even close to the scenario. The employee "might" insure it themselves when its not their car. All perfectly fine and reasonable, IF the leasing company are happy with that. (TBH most company cars are insured via a company scheme, not an individuals)
In the O/Ps case the leasing company are NOT happy with the O/Ps parents insuring the car, therefore the O/P is proposing insuring the car himself to side step the leasing company's criteria, but not being the main driver - in fact not being a driver at all, nor having the car in their possession at their own address.
Insurance companies in the event of a significant claim will go through the details of the claim. I think there is potential there for the insurance company to walk away from having to pay out.
Personally, i am saying tread with caution.
If you can categorically and without doubt tell the O/P to go ahead with that and that and its risk free, then by all means do so and i will retract all my comments0 -
mustbesavvy wrote: »Blimey, what have I started. Was just trying to better understand if there was a sensible route to being able to lease a car for my parents, openly, honestly, legally. Not sure this was the site I should have come to!
Clearly I'm a massive fraudulent criminal!
I'm not at all saying you are a criminal, however as you have yourself identified you do need to be careful here and ensure all parties involved are happy with the situation.
To me, that would involved ringing the leasing company and explaining what you are planning on doing - leasing a car for your parents, insuring it in your name but with them on the policy and it residing at their address and them being the main drivers and get confirmation they are happy with that.
You then would need to explain this to the insurance company and confirm they are happy that you are the policy holder and they are the main drivers and get confirmation they are happy with that.
GAP insurance. I'd ring them and confirm too.
If you dont do those things, then any one of those parties could revoke their agreement at any time - most likely in the event of a claim.
I think full disclosure is key.
As i said, take the worst case scenario that they have an accident when on holiday in the lake district or wherever and the car gets written off - are the insurance company going to pay out when it transpires the car isnt ever driven by you? I'd rather find that out in advance...
Personally - i would take out a cheap loan and buy a car outright and let them register and insure it in their names.0 -
Not even close to the scenario. The employee "might" insure it themselves when its not their car. All perfectly fine and reasonable, IF the leasing company are happy with that. (TBH most company cars are insured via a company scheme, not an individuals)
In the O/Ps case the leasing company are NOT happy with the O/Ps parents insuring the car, therefore the O/P is proposing insuring the car himself to side step the leasing company's criteria, but not being the main driver - in fact not being a driver at all, nor having the car in their possession at their own address.
Insurance companies in the event of a significant claim will go through the details of the claim. I think there is potential there for the insurance company to walk away from having to pay out.
Personally, i am saying tread with caution.
If you can categorically and without doubt tell the O/P to go ahead with that and that and its risk free, then by all means do so and i will retract all my comments
And if he could get insurance, where's the fraud?
You won't retract anything and you'll never admit you jumped in without thinking as you've yet to show any dishonesty by the OP or any attempt to deceive the lease company. All he did was ask if there was a way round it.0
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