Buying A Car For Someone Else To Drive Fixed
At the heart of it, we want to know, "If we give them permission and they get into an accident, is it covered by my insurance? Is it legal for someone to drive my car who is not on my insurance policy?"
buying a car for someone else to drive
As with anything else, use good judgment and common sense. Make sure you are fully aware of the liability you may be opening yourself, and your auto policy, up to before handing over your keys. "Don't be cavalier about lending your car," adds Salvatore. "If you know someone isn't a good driver, think twice about giving your permission. Any crash they're in could go on your insurance record."
There are many reasons a car shopper decides they want to purchase a vehicle for another party. Maybe they're buying it for their kid who is just starting to drive, or perhaps an elderly parent. They could also be looking to buy a car as a gift for a significant other or help out a friend who has bad credit. Although we're used to seeing ads that feature shiny new vehicles with big red bows, surprised recipients, and proud gifters, there's a lot more that goes into buying a vehicle as a gift. We'll address common questions like "Do you need a license and insurance to buy a car?" "How can you gift a car?" and, "How does auto financing work in this scenario?"
Let's start with some of the logistics. If you're not a car owner yourself, and you want to purchase a vehicle for a family member or friend, you may not have some of the documents that are needed when buying a vehicle. These include a current driver's license to test drive the vehicle (and drive it off the lot) as well as car insurance.
Insurance coverage is the other piece of the car buying puzzle. The vehicle will need to be covered before it can be driven, so the recipient of the car will need to have an insurance policy in their name. If you choose to purchase the insurance policy along with the vehicle, you can list the recipient as the primary driver on the account.
Perhaps the most confusing part of buying a car on someone else's behalf is the car loan process. In order to buy a vehicle for another party, you'll have to put the loan entirely in your name, cosign, or co-borrow with the recipient. The person receiving the car will need to go to the dealership in person to cosign the loan, and if you're planning the gift as a surprise, you will need to put the loan into your own name. The title of the vehicle can still be registered under both your name and the recipient's.
Compromised credit can make buying a car difficult. If you're looking to buy a car to help out a friend or family member with bad credit, your best bet is to act as a cosigner or co-borrower. Financing a car in your name and then transferring it to someone who could not obtain a car loan on their own is called a 'straw purchase' and it is illegal and risky. Using someone else's name to secure a car loan because of poor credit also falls under this umbrella. Co-signing on the loan means you will be responsible for making payments if the primary owner defaults, so you should be prepared to take on this risk.
You must cancel your registration within 30 days of cancelling insurance coverage to avoid fines and penalties related to Georgia law requiring insurance coverage. Remember! It is illegal for you to drive or allow someone else to drive a vehicle that is uninsured.
How insurance comes into play after an accident when someone else drives your car depends on your specific car insurance coverage, so be sure to check with your insurance agent to find out how your policy covers other drivers.
The renter of the vehicle must be present to sign the rental agreement and provide their credit card at the time of pick up. The renter cannot provide a credit or debit card belonging to someone else for their use.
If you wish to pay for the rental car, but have someone else drive it, you can rent the vehicle in your name and add them as an additional driver. In order to add an additional driver, they would have to meet all of our additional driver requirements; those requirements can be found here:
Remember, if you or someone on your behalf gives your insurance company false, deceptive, misleading, or incomplete information concerning the description and place of garaging of your car, or the names of those people who drive your car, your insurer may refuse to pay your claims under any or all of the Optional Insurance Parts of your policy.
Whether you want to rent a car as a gift for someone else or for another employee at work, you may find yourself wondering how to do it or if it is even possible. And the answer is far from obvious.
You may also consider buying a car from another state to save money. There are regional differences in new-vehicle pricing and manufacturer incentives, so a car with no incentive available in your state might have a lower price and a rich incentive on it elsewhere.
Another potential reason to consider an out-of-state car purchase revolves around the fact that some vehicles are popular in one market while they are less popular in another. This means you might be able to buy a model with four-wheel drive (4WD) in the Sunbelt cheaper than you could buy it in the Rockies. And this potential opportunity, unlike the first, applies equally to used vehicles. You might discover with an Internet search that a particular five-year-old sports car you crave is much cheaper in another state than it is in your local area. You might also believe that buying a car out of state is a way to steer around state and local taxes, which could potentially save you some money, but as you'll see, that is unlikely.
Whether you are buying a showroom-new vehicle, a "basket case," or a parts car, understanding the vehicle's condition is the absolute key to getting a good deal. The distance can be a significant impediment to doing that. You might be reluctant to travel to look at the potential purchase for time or cost reasons, and you are probably very reluctant to do that repeatedly. That implies that you find a substitute for going to see and drive the car yourself.
If your vehicle does not have insurance and you or someone else driving your uninsured vehicle are involved in a traffic crash, the DMV will revoke your driver license and vehicle registration for at least one year.
Adding an additional interest does not increase your car insurance premium. It simply states that someone else has an insurable interest in the car. It means the owner still has a financial interest in the vehicle even if they are not the primary driver.
Many drivers may attempt to have someone else insure their car to help them save money. This may be the case for high-risk drivers who have been quoted high insurance rates. However, you should avoid this at all costs, because that is illegal and counts as insurance fraud.
Yes, you can buy auto insurance coverage for someone else, as most companies allow the driver and policyholder to be in different names. This is fairly common for teen drivers, as parents generally are the auto policyholders until dependents can purchase their own vehicle and own insurance.
It is very hard to prove whether or not someone had permission to drive your car. If you cannot prove you did not grant them permission and an accident happened, you might get stuck paying for damages.
You might also specifically leave someone off your insurance policy if they have a bad driving record, and you know it will increase your premiums. If you then let that person drive your car and it leads to an accident, your insurance will not have to pay those damages. You will be left having to pay those damages out-of-pocket.
If someone else drives your car and gets in a car accident he or she can collect auto No-Fault benefits (which would pay for accident-related medical expenses and lost wages if someone is too injured to return to work) through his or her own auto insurance policy. This is how it will work if he or she is the named insured on the policy, or through a policy belonging to a spouse or a resident relative. (MCL 500.3114(1)) If No-Fault insurance coverage is not available through these three sources, then he or she would apply for benefits through the Michigan Assigned Claims Plan. (MCL 500.3114(4))
That means before you let anyone borrows your keys you need to make sure they are a safe driver. If you are letting an unsafe person operate your car and he or she seriously injures or kills someone, you can and will be sued.
If you don't own a vehicle but drive on a regular basis, it may be a good idea to get a non-owner auto insurance policy. By doing so, you can protect yourself against losses that result from an accident you cause with someone else's car. If you live in Texas, you may be wondering if it's mandatory for drivers who don't have vehicles to carry non-owner auto insurance. Check out this comprehensive guide to non-owner car insurance in Texas.
Myth #4: If someone else drives my car and gets into an accident, their auto insurance will cover them, not mine. Fact: In most states, the car owner's insurance must pay for damages caused by an accident. Get familiar with the laws in your state before allowing another person to drive your car.
Buying a car without a license does pose its limitations, but if you need to buy a car for someone else, it can be done. You may run into issues at the dealership, as your driver's license is one of the first things salespeople typically ask for, but letting them know the reason can move the process along.
Proves Your IdentityDealers need to make sure that you aren't trying to take out a car loan in someone else's name. This also helps the lender know that they are pulling the right credit report when it's time to check for your qualifications for financing. 041b061a72