Splitting car costs

SRK476

So me and my long time partner want to get a used rav4, around the 18k budget mark. I have just about 15k of money to spend. I was wondering how our equity over the car would get split if I pay the majority of the car. lets say the car I want is 18k so I put 15k down and we(my partner and I) get a joint car loan for the remaining value. essentially who owns the car?

kyfdx

SRK476 said:

So me and my long time partner want to get a used rav4, around the 18k budget mark. I have just about 15k of money to spend. I was wondering how our equity over the car would get split if I pay the majority of the car. lets say the car I want is 18k so I put 15k down and we(my partner and I) get a joint car loan for the remaining value. essentially who owns the car?

Sounds more like a legal or marriage counselor question.

Unless you draw up some sort of agreement, you'll likely own the whole vehicle together, with no split. Especially with a loan. If payments aren't made, the bank will consider each of you fully responsible.

If you are paying for the majority of the vehicle, it might make more sense for you to own it, and your partner to pay you a monthly stipend to use the car. Assuming you keep separate finances.

Mr_Shiftright

Whoever has their name(s) on the title owns the car as far as DMV, a bank and probably in most legal situations. If your title reads Person A AND Person B, then you both sign off when you sell it. If it reads Person A OR Person B, then either one can sell it. If it just reads Person A, then that person owns it outright.

With that imbalance in equity, the two of you can split the operating costs, but if I were you I'd just agree to give your partner back the same fraction of equity when you sell it. So you owe the partner something like 16% (whatever percentage $3000 is of $18000--I think that's close enough). If you sell the vehicle in 5 years for $9000, then they get $1450 or some such.

thebean

Sounds like a really good way to get a new partner in time.