buying car for BIL any safeguards?

wrightk

Hi all,

I have put a deposit down on a vehicle for my brother in law who has had a catastrophic breakdown on his previous which essentially renders vehicle a write off.

He's in permanant well paid work (bricky) but has had financial probs several years ago. I'm happy to lend him the money and i know him extremely well, however he has suggested that i be the registered owner of the vehicle until he has paid off the money to safeguard me.

Not exactly sure how this would work? I dont want to register the vehicle in my name as it won't be mine and this would have obvious implications for insurance, tax etc. does the receipt prove ownership? Anything else i could do?

Thanks

Arklight

Being the registered keeper and the legal owner are different things.

If he isn't on the V5C then beware the small print of any insurance policy he takes out.

wrightk

Arklight wrote: »

Being the registered keeper and the legal owner are different things.

If he isn't on the V5C then beware the small print of any insurance policy he takes out.

I'd be happy to register the car in my name and transfer to him after the loan is paid but i have no intention of driving the vehicle, it is a loan essentially.. if i did this wouldn't i be 'insurance fronting'?

Nebulous2

wrightk wrote: »

I'd be happy to register the car in my name and transfer to him after the loan is paid but i have no intention of driving the vehicle, it is a loan essentially.. if i did this wouldn't i be 'insurance fronting'?

Not at all. I've known two people who have no longer been able to drive who passed their cars on to relatives, while keeping the v5 in their name. The relative who is now driving it has insured it in their own right without it being registered to them.

The key point - as stated is that you check that your bil's insurer will allow it. They dont all accept it.

born_again

wrightk wrote: »

I'd be happy to register the car in my name and transfer to him after the loan is paid but i have no intention of driving the vehicle, it is a loan essentially.. if i did this wouldn't i be 'insurance fronting'?

Fronting is when the main driver of the car is not listed on the insurance policy as the main driver.

Don't forget to get something in writing over the loan...

AdrianC

Having the V5C in your name adds nothing to whether he's ever going to pay you back, or whether you trust him, or whatever. It merely says that you get the tax letters and any speeding photos. Woo.

When he insures it, they ask who the main driver is. If he lies about that, to get a lower premium, that's fronting.

wrightk

AdrianC wrote: »

Having the V5C in your name adds nothing to whether he's ever going to pay you back, or whether you trust him, or whatever. It merely says that you get the tax letters and any speeding photos. Woo.

When he insures it, they ask who the main driver is. If he lies about that, to get a lower premium, that's fronting.

Thanks, so the best way would be just to pay for the car for him in my name with all receipts to that effect (which would give me legal ownership) and he become the registered keeper on the v5 to give him sole responsibility for tax,insurance etc etc?

Also to get something in writing over the loan

AdrianC

wrightk wrote: »

Thanks, so the best way would be just to pay for the car for him in my name with all receipts to that effect (which would give me legal ownership) and he become the registered keeper on the v5 to give him sole responsibility for tax,insurance etc etc?

Also to get something in writing over the loan

Up to you as to what degree you feel you need that, or what it'd add if things do go sour... But - yep - that's about as comprehensive as you're going to get.

marlot

I'd just write up a simple agreement about the loan, and agree that I keep the spare key for the car, and it gets repossessed if he's more than x months behind on his payments.

AdrianC

marlot wrote: »

I'd just write up a simple agreement about the loan, and agree that I keep the spare key for the car, and it gets repossessed if he's more than x months behind on his payments.

At which point you find that the car's parked somewhere hidden, and when you do track it down, you discover that he's had "your" key removed from the security.

Families and money.

Arklight

What actually is this car? If he's that well paid cant he just buy £500 run around until he's saved up?

You don't sound like you trust that you'll get this vehicle or the money back from him or you wouldn't be worrying about all this..

My advice when it comes to lending family money is don't, but if you do, accept you may never see it again, irrespective of what the V5C and receipts say.