Friend taking over wife's car still on finance - advice please?

[mattk1]

Hi guys,

I am planning an exit back to my home country fairly soon but I have a question regarding the car me and my wife currently own on finance.

The car cost 530k Baht and was ordered during the government tax back scheme in 2012. We received 73k Baht from the government as promised one year later, and I am aware that we can’t sell the car for a 5 year period.

However, a friend of mine is keen to take the car off me when I leave and fully understands that the car won’t be in his name straight away.

To outline a bit about the car:

• We put 125k Baht down payment on the car when we ordered it
• The finance was taken over 5 years
• Car was delivered March 2013
• Monthly payment is 7,300 Baht (payment never missed to this day)

As I mentioned above, a friend of mine is keen to take over the payments and see the car through another couple of years finance, but how would that work out for me? Would I just be walking away from the deal or should I be getting some cash back out of it?

I really have no idea how this works so would be grateful of any advice from someone who has maybe done a similar thing.

Cheers guys!

[stevenl]

I can see 2 options here:

1. You can transfer the car now to your friend. However the finance company would have to agree and you'd have to pay back the 73k.

2. Your friend can use the car and transfer it in his name March 2018. However you run the risk of anything happening to or with the car, and transferring the car in his name may not be easy since you can't provide the required paperwork (certificate of address).

How you arrange things (who pays who) between you and your friend is up to the 2 of you.

[krisb]

Hmm, I'd be closing my end of the finance deal first.

Usually finance companies expect this anyway, the loans yours, not your friends and I doubt they will transfer the debt to a new name. In Australia it's actually illegal to do what your suggesting.

These things usually end badly when a friend takes over a loan, they start missing payments and before you know it once friends are in court and it's your problem. Imagine if they write the car off or don't pay etc etc etc, and also ask yourself why they can't go and get a loan for themselves in the first place?

Don't risk it mate, sell it and then pay the loan out first in full, or keep it for when you return.

[MaeJoMTB]

No,

He'll make a couple of payments then stop, the car will disappear.

Your wife and the guarantor will then be taken to court and lose the full amount owed.

Happens every time.

Edited June 4, 2015 by MaeJoMTB

[pgrahmm]

Good advice given....usually does not work out well....And my guess is your "friend in need/indeed" is very keen due to circumstances he's created.....if you no longer want or need the car try someone similar to Expat Auto CM.....they can take and sell it for you - of course you keep up payments until sold.....Car gets sold - credit still good and the car is not in harms way ...... look at this another way - should your buddy drink and drive ...... hit/kill somebody and bail out it won't be him they will be after for prosecution or money....even if he does not bail still could be consequences for you - it's YOUR car.......

[stevenl]

Good advice given....usually does not work out well....And my guess is your "friend in need/indeed" is very keen due to circumstances he's created.....if you no longer want or need the car try someone similar to Expat Auto CM.....they can take and sell it for you - of course you keep up payments until sold.....Car gets sold - credit still good and the car is not in harms way ...... look at this another way - should your buddy drink and drive ...... hit/kill somebody and bail out it won't be him they will be after for prosecution or money....even if he does not bail still could be consequences for you - it's YOUR car.......

Doesn't matter who's car it is, the driver would be at fault.

[pgrahmm]

Good advice given....usually does not work out well....And my guess is your "friend in need/indeed" is very keen due to circumstances he's created.....if you no longer want or need the car try someone similar to Expat Auto CM.....they can take and sell it for you - of course you keep up payments until sold.....Car gets sold - credit still good and the car is not in harms way ...... look at this another way - should your buddy drink and drive ...... hit/kill somebody and bail out it won't be him they will be after for prosecution or money....even if he does not bail still could be consequences for you - it's YOUR car.......

Doesn't matter who's car it is, the driver would be at fault.

TIT - Assuming all is above board and well.....once the car is out of the owner's control a lot can happen.....The new payer might could loan it out or give for his "family" members to use.....Wife/BIL/student/GF's....or assign to another payer....after all that's how he got it.... Edited June 4, 2015 by pgrahmm

[stevenl]

Good advice given....usually does not work out well....And my guess is your "friend in need/indeed" is very keen due to circumstances he's created.....if you no longer want or need the car try someone similar to Expat Auto CM.....they can take and sell it for you - of course you keep up payments until sold.....Car gets sold - credit still good and the car is not in harms way ...... look at this another way - should your buddy drink and drive ...... hit/kill somebody and bail out it won't be him they will be after for prosecution or money....even if he does not bail still could be consequences for you - it's YOUR car.......

Doesn't matter who's car it is, the driver would be at fault.

TIT - Assuming all is above board and well.....once the car is out of the owner's control a lot can happen.....The new payer might could loan it out or give for his "family" members to use.....Wife/BIL/student/GF's....or assign to another payer....after all that's how he got it....

Yes, agree with all that, but that has nothing to do with 'driver drinks and drives and you have a problem because it is your car'.

[sotsira]

OP,

The way it works is that you and your wife still owe the remaining 33 months

of finance payments to the finance company which equates to

33 x 7300bt = 240,900bt

Plus the 73000bt tax rebate which makes a total of 313,900bt.

This means you need to sell the car for a minimum of 313,900bt

You need to find out what is the current market value of your car

to determine whether you should have any cash back or not.

Either your friend buys the car for that amount and becomes the new legal owner

or you sell it to someone else and pay off the finance co.

Once you have established a buyer you would both need to visit the finance co

for them to take the payment and process the paperwork for you and your wife to be

cleared from ownership.

[NeverSure]

The only time I ever trusted a "friend" like this it cost me 650,000 baht. I was in no position (as you won't be) to do anything other than pay the loan off and I never saw the vehicle or the friend again. This was BTW a loan I co-signed as guarantor, not a car I sold but the result was the same.

What will you be able to do from your home country if when this thing goes sideways and the lender wants your payments made? You'll do what I did. You'll send the balance of the loan ("the payoff amount") to the lender simply because your word is good and so is your credit rating.

[IMHO]

The thing you really need to think about is that the whole time he's making payments (or not) it's your wife's car, your wife's liability, your wife's credit rating.

What assurance do you have he will make payments on time? If he doesn't your wife *has* to pay, and will never get finance again.

What happens if he crashes the car and just dissapears?

What happens if he doesn't renew the insurance when next due, and the car gets written off or stolen? Can he pay up the full amount owing? will he?

Edited June 5, 2015 by IMHO

[rethaier]

DON'T

[misterphil]

If the cars in your wifes name he'll be able transfer it easily in 2018 with copies of her ID card, and he or someone will need to sign/forge her signature.

If its in your name you will need to be here cause youll need a residency certificate.

[NickJ]

No way.....Pay it off and sell it. I would not want to be halfway around the world trying to pry payments out of your friend. Could end up having to fly back here to do what you should have done in the first place.

If thinks did end up going south think of how your wife would stress over it.

[scorecard]

I can see 2 options here:

1. You can transfer the car now to your friend. However the finance company would have to agree and you'd have to pay back the 73k.

2. Your friend can use the car and transfer it in his name March 2018. However you run the risk of anything happening to or with the car, and transferring the car in his name may not be easy since you can't provide the required paperwork (certificate of address).

How you arrange things (who pays who) between you and your friend is up to the 2 of you.

Well said, I would add beware of any complications with both the compulsory and other insurances. Always emeber that insurance companies (bless them) will look for a loophole / an out before they pay any claims.

Some insurance companies expect (and it may be in the fine print) that only the name in the blue book and immediate family will actually drive the car and it is possible that the fine print says if anybody outside of this circle is driving when there is an accident then the insurance is voided.

Be careful.

[mattk1]

Hi guys,

Wow some excellent reply posts here with great advice so I first I want to say thanks to everyone who has contributed!

It would seem the majority vote is to pay off the car and then sell it, which is more hassle but I guess more peace of mind once we are out of the country - cut all ties from it.

Having a chat with my missus earlier she mentioned that her sister may take over the payments.. hmmm... this one could be a bit more tricky to get out of than I'd hoped, lol..

[stevenl]

How about selling to your wife's sister? Pay the finance off now and transfer in her name once the 5 years are over for the rebate.

[F4UCorsair]

Sister, friend.....the advice is the same. Unload it, pay the B73,000 and have peace of mind.

[scorecard]

Hi guys,

Wow some excellent reply posts here with great advice so I first I want to say thanks to everyone who has contributed!

It would seem the majority vote is to pay off the car and then sell it, which is more hassle but I guess more peace of mind once we are out of the country - cut all ties from it.

Having a chat with my missus earlier she mentioned that her sister may take over the payments.. hmmm... this one could be a bit more tricky to get out of than I'd hoped, lol..

Sister: "but what can I do, this month no money, why you no understand?'

Bigger picture - who has most equity in the vehicle, can you ever explain this to sister? 'I paid the last two payments and it's now fully paid therefore I own the car, right?'

Not being smart, this is reality.

I know from past family experience.

[CNXTim]

The first mistake you have made is contained in the statement "my Wife's Car" It is almost certainly NOT.

In almost every case under law the car is owned by the finance company.

You cannot decide what will happen to an asset you don't own.

In another twist to this, the new car subsidy was paid to your wife as a matter of political expediency which is a separate obligation if the terms of the subsidy are not met.

If you want your friend to acquire the debt burden your wife should consult the legal owner being the bank/financier.

[casualbiker]

As far as I understood the finance here you can indeed transfer the payments legally to another person AND it will not affect the car refund scheme as the car is currently in the finance company name it's only after you pay that it goes into the purchaser's name.. Contact the finance company and ask the question!

[mattk1]

Thanks again for the great replies here, given me a bit to think about

To casualbiker, I think you are right, best contact the finance company who own the car and see what they say about the situation. At the end of the day I just want to be free from it when we leave the country and not have to worry about someone else's financial ability to pay for it.

I'll report back here what I find out since I've noticed a few other previous posts asking about a similar thing with these cars that were bought under the government tax back scheme

Cheers guys

[krisb]

Maybe the best way would be for you to pay the loan out, and whoevers taking over it pays the money into your bank account.

[NanLaew]

Maybe the best way would be for you to pay the loan out, and whoevers taking over it pays the money into your bank account.

If the OP pays the loan out, what is there for the new prospective owner to take over?

If you mean the car, then the OP departs Thailand full of reassurance that the new owner will pay?

Your grammar threw me but I think we have a situation here where neither the OP or any prospective buyer he has mentioned has the lump-sum in cash to pay anyone anything.

[mattk1]

Maybe the best way would be for you to pay the loan out, and whoevers taking over it pays the money into your bank account.

If the OP pays the loan out, what is there for the new prospective owner to take over?

If you mean the car, then the OP departs Thailand full of reassurance that the new owner will pay?

Your grammar threw me but I think we have a situation here where neither the OP or any prospective buyer he has mentioned has the lump-sum in cash to pay anyone anything.

Hi krisb, yeah that's right spot on, and it's that which makes the situation that little bit trickier :-)

I could always just hand it back to the finance company I guess, couldn't I?

Cheers for all the helpful replies here, much appreciated!

[Ace of Pop]

You are not selling your Wifes Car, its the Finance Companies till the Blue Books in her hand.Best you deal with the Owners and play safe.