This is essentially an indirect transaction in which the new buyer pays the original buyer and relies on the original buyer to pay the lender in turn. This puts the new buyer at risk unless a security mechanism is written into the contract to protect the new buyer if the original buyer is late. In cases where the sale of assets is done through a takeover, the lender holds a right of pledge on the property. The right of pledge gives the lender the power to sue the borrower for non-execution of the loan or to repossess the asset in the event of default. Since car contracts are highly personalized, a third party can`t just take over the credit agreement for you. You can enter into a sublease agreement with third parties where the person takes care of your monthly payments in exchange for the vehicle. Subletting is not recommended, as this type of financial agreement carries a significant risk. You want to remove your name from the vehicle if you no longer drive it or if you are in possession of it. Get everything in writing if you opt for this route. If you`re willing to trust your friend and have them take care of payments for your car, this may be possible, even though it`s not entirely legal in some states. After handing over the keys to the new owner with an oral agreement, they send you a check for payment every month. Your boyfriend leaves in your car, and he`s no longer yours.
But in the eyes of your lender, that`s still the case. Your financial institution is waiting for monthly payments, whether or not your friend sends you the money. The possibilities of things going wrong don`t stop at payment. There are also insurance considerations, such as who buys coverage. When the property is sold by taking over payments, the lender usually has a right of pledge on the property. The guidelines on real estate and personal property are a little different. But in general, they are a legal interest of lenders in the asset that is used as collateral for a loan….