How do you trade cars from owner to owner if both owners have loans on their current cars?
Basically what the question says…
I own a car and the other woman owns a car. We want to trade cars but we are both making payments to the bank at the moment on our current cars. Is there any way to trade our cars that we have?
No the banks will not allow it. You need to get the loan transffered. If the other person stops paying you’ll be due the payments.
No, you cannot do this legally. And if you make the poor decision to do so, the lender(s) can come take the vehicle(s). This is a violation of the contract.
Several things to consider:
– Insurance MUST remain in the name of the person on the loan.
– You would not be able to register the “new” car in your name.
– If she goes and has a wreck in your car, YOU are liable. If she goes and gets 300 parking tickets, you are paying for them.
Don’t do it.
**** Edit – Folks, you CANNOT just “transfer” names on a loan. It doesn’t work that way. The reason why some of you have never heard of that is because it doesn’t exist as a practice in the banking industry.
You don’t. It isn’t legal without lender approval. Until the loan is paid off and the lien is released on the title, it isn’t your car to do just anything you want with.
The only way I have seen this done is if each bank is local. You would go into her bank and pay the car off and receive a release form from her bank. Then go into your bank and pay the car off and get a release from your bank. Bring these papers into DMV and have them swapped. Call DMV first if this is doable to check if additional paperwork is required in your state.
Not familiar with the process of changing the names on the loans as mentioned above, but that sounds like the way to go if you don’t have cash on hand to pay the cars off, even if just temporary.