Auto Insurance Question

wenpeek · #1 (**permalink**) 10-01-2006, 12:46 AM

Does anyone have any experience with owner financing regarding a vehicle? I've been given the opportunity of taking over payments of a vehicle, which I desperately needed, and I was wondering how exactly I go about getting auto insurance coverage in my name? Surely there's got to be some type of coverage out there that I can get until the car is paid off and transferred into my name. Any advice would be greatly appreciated!

Wendy Peek ~ Dallas, Texas

creditcardfree · #2 (**permalink**) 10-01-2006, 08:07 AM

Is this someone you know that is financing this car?

I personally would be leary of taking over payments, and as the owner I would definitely not let someone take over payments...as that my risk my credit score.

Do you have anyway to get financing? Does this mean you are buying more car than you can afford?

As far as the insurance, I would just call an insurance company and ask. I really don't know the answer to your question. I would think that you would need to have liability, but the owner of the vehicle may need to keep their collision insurance. Seems complicated and costly to me. Just my opinion.

Anyone else have thoughts or advice?

Mathew Green · #3 (**permalink**) 10-01-2006, 03:04 PM

In most (all?) states the owner of the vehicle is liable if it is involved in an accident. IOW, it's the vehicle that is insured, not the driver.

Having said that, if you were driving when an accident happened the owner and/or injured parties would probably sue you personally for having contributed to the accident. And a normal insurance policy wouldn't cover that, only a special policy that covers you regardless of what you're driving could be counted on to protect you.

As said above, this is a situation you need to discuss in detail with several insurance agents. However my gut feeling is that you should run, not walk, away from this deal if the current owner wants to keep the car in his name while you're driving it and making payments. That senario is risky from so many different angles that I wouldn't go near it. There are good reasons why state laws require the sale of an automobile to be done in writing and reported to the state promptly. No way would I make payments on a car without properly transfering title to my name ASAP.