It’s not uncommon to share driving time with people you share living spaces with. Similarly, it’s not uncommon to share a car title with a family member or your spouse. You may be sharing the car title because you received it as an inheritance or a gift, or you may have purchased it as an investment with your significant other.
If you share a car with another owner, what are your chances when taking out a title loan on it?
Can You Get a Loan on a Shared Title?
The answer is yes. But, the words that appear between your name and the other owner’s make a big difference. Your car title might have an “or,” “and,” or “and/or” between the names. There’s a significant difference between say, Jane Doe or John Doe and Jane Doe and John Doe.
An “or” title allows either party to take out a title loan on the shared car even when one party is not present. When the names are joined by an “and” or “and/or,” it is still possible to take out a loan, but the title loan must also be in both parties’ names. Both title owners need to acknowledge and sign the loan, even when only one party will be responsible for repaying the loan.
It’s an entirely different story if you’re driving a shared car and your name doesn’t appear on the title. Remember that only an individual whose name is on the title can take out a loan. If you split car time with someone else but the title is on their name, you will be unable to borrow anything against it, even when you’re the main driver.
What to Remember When Borrowing With a Shared Title
As you may already know, at the end of your loan term, after you have repaid the loaned amount in full, you will be able to get your title back. But, in the event of a default, the other person who owns the car with you could lose the title as well.
To prevent bad blood with the person you share the loan with, make sure that:
1. Your co-owner understands the situation, as well as any possible consequences.
Disclose to the other party that they will also be financially responsible for any debt on the car you share. Ask about their ability to repay the loan, in case you’re unable to make the payments.
2. Be aware of the impact the loan can have on your relationship.
In a worst-case situation, the person you share the title may be forced to pay. Otherwise, you risk both of your scores dropping. Make sure you can commit to making on-time payments to avoid negative impacts on your relationship.
Looking to take out a loan on a shared car? Contact our experts at VIP Title Loans for help in determining the right course of action for your situation. Our goal is to provide you with the assistance you need to bounce back.
Call us today or visit any of our stores for a consultation!