Should car finances be split equally if you’re not named owner?

supersaver96

My partner and I recently moved in together, and we decided we only needed one car between us as I work from home and he commutes via train. He bought a car on finance before we got together, and has 2.5 years left of the agreement. I had an old banger of which the battery kept dying, so I scrapped mine and he added me to his insurance.

I personally would never have bought a car on finance, and his car is a huge expense each month, and at the end he will still have to pay thousands if he wants to own it, or they’ll take it back. My dilemma is whether I should contribute to the payments to help him cover the cost seeing as I can use the car when I need it? But it’s in his name on the ownership, so if anything happened between us I wouldn’t own any part of the car that I contributed too.

I would love to know what people think is fair in this set up, or how they split the costs of a shared car on finance.

Brie

oh dear. sounds like the sort of conversation they always say you should have before you move in together. well, too late now so let's consider the rest of the picture.

what do you think about other things that one or the other had but decided to ditch when moving in? Your sofa and his dining room table? All those things will go to one or the other should you split.

What are you doing about the rest of the bills - even split or pro rata based on earnings? Or one pays the utilities and the other buys the groceries?

Does he earn enough to afford this all by himself? It's his debt after all. Is he paying towards your credit cards or student loan? And will his debt keep you both from doing something like have a holiday or get a new TV or whatever? or you paying in to an ISA or getting extra pension?

I guess it's a case of having a look at your separate and and combined finances and decide what's important for you both individually and as a couple.

Frankly I'm on your side as I've never understood buying a car on finance. That said I've bought a few using a credit card that needed to be juggled about for a few years. And that's both for cars for me and for him though ultimately it was me always paying because I was the one with earning power. We always had fun when buying cars as the people in a showroom would always be chatting him up and doing all the negotiating with him and when it came to sealing the deal and paying he'd just point at me and say "talk to my wife about that!"

elsien

How much do you use the car when it is just you?

tacpot12

Generally car finances should be split when two or more people have the use of it. The only issue with splitting car finances when you aren't the owner is that in paying a repair bill, you're not just keeping the car viable as a means of transport, you are potentially increasing it's value or lifespan for the owner. So as the non-owner, you might baulk at fitting parts from the original manufacturer or the best quality tyres, as you may never get the benefit of these.

Running a shared car is always going to involve some compromise, and you will save more if you pay half the cost of better parts than it would cost you if you were running your own car and using the cheapest parts, which might then not last as long. So just split the costs.

However, you have a problem with the choice he made about how he would 'own' the car. He doesn't own it, he's renting it, and has an obligation to te hirer to maintain it, and pay the hire charges. It probably is right that you pay something to have the use of the car, but perhaps not half as the chocie was all his and it was not a choice you would have made. I would suggest that you pay some amount between half the cost of the car you would have bought and half the payments he is making. Where you end up is a discussion for you both, but iif he wants the relationship to be a long-term one, he will have to make some addjustment to the money you are prepared to spend on a car and vice versa.

rach_k

Assuming you haven't doubled the cost of his car insurance (I bring the cost of my partner's down), I would offer to pay half of that and put in enough fuel to cover my own usage. That would seem fair enough to me from either side, especially if you're a fairly light user of the car and he made the decision to buy on finance before sharing the car was an option.

I'd say how he chose to pay for the car is irrelevant - if he owned it outright, you'd be unlikely to offer to pay a sum of money to him towards it now, you'd just cover the additional cost you're causing. Covering half of the insurance and your fuel should be plenty. If you want to account for maintenance, pay per mile using HMRC's 45p/mile instead.

You could start putting a bit aside each month towards buying another car outright if he decides to return it. Then you could buy your own car if sharing doesn't work out, or go properly 50/50 on a car you both own and make joint decisions about (decided in advance!).

MEM62

If he is silly enough to enter into a finance agreement where he pays through the nose for a car that he will not even necessarily own, I see no reason why you should join him in his madness. Contributing to the running costs would be fair but the car repayments are his problem.

supersaver96

Thank you to everyone who has taken the time to share their perspectives, it’s greatly appreciated.

For some additional context regarding some questions raised:

• we are first time home owners, so all furniture bought is new and split 50/50 financially
• Adding me to the insurance did lower the cost
• I use the car maybe twice a month on my own, the rest is mostly my partner or us both going somewhere together
• I currently contribute half of the insurance and fuel costs as I think that’s definitely fair as I am getting transport out of it

I am torn between contributing towards the hire cost he pays as I do have use of the car, but conversely it could be wiser to save my money to buy a car outright as the end of his agreement term.

Unfortunately he was encouraged by a parent to enter into the finance agreement for the car, and does now regret it but is trapped as to return it now would actually cost a lot of money

silvercar

if you had kept your car instead, you would have had the maintenance costs of an old banger plus fuel and insurance. Arguably he could have contributed to those costs. I’d work out what that would be and use that as a guide to your contribution.

Alternatively you could put in too savings the costs you have saved by not having to run a car.

onomatopoeia99

Leave your partner to pay the ownership cost of the car they own until they can hand it back without extra charges, then when the finance is done consider buying a car jointly if you are only having one between you both, which you buy for cash.