Can I take out car finance for someone else?

Car finance advice
Car finance and accommodation deals

“Can I take out car finance in my name if the car is for someone else?”  Asked by Bradley, December 2013.

“Is it possible to have more than one car finance agreement in my name? I have a PCP for my car and I want to start another one for my girlfriend’s car as she can’t get finance approved, but the dealer said I can’t do that.  If I can afford it, why not?” asks Bradley.

We have looked at different types of car finance before at The Car Expert, especially the most popular type of car finance agreement – the Personal Contract Purchase. But there is one assumption in any car finance application – that the person applying for car finance is the owner, keeper and main driver of the vehicle.

Bradley’s question is a common one when people are applying for car finance, and it causes considerable confusion.

If you are in the position of having a poor credit score or credit history and you can’t get car finance approval, it seems simple enough to ask someone else (usually a spouse/partner/parent/close friend) to take the finance in their name, while you promise to pay them for the monthly payments.

Car finance – the Accommodation Deal

The problem is that you generally can’t do it. Taking out car finance for someone else is known as an Accommodation Deal, and the finance companies simply won’t touch it, despite the concept not actually being illegal. So what exactly is the problem?

If you are unable to get finance, it is because the finance company has decided that you are too high a risk to loan money to. For whatever reason, be it failing to pay previous bills or not enough evidence of suitable income, the finance company has decided it does not believe that you can or will repay their loan.

So if they won’t lend to you, they are not going to lend money to someone else who is applying on your behalf, and who is expecting you to pay them for the loan. You are trying to circumvent your inability to get car finance by having someone else get it for you, and the finance companies are not stupid.

The logic is simple: the finance company does not expect you to be able to repay the loan to them, so they don’t expect you to be able to repay the same amount of money to another person. The person responsible for repaying the loan does not have possession of the vehicle (because you have it), which leaves the finance company at greater risk of not getting its money back and not getting the car back.

If you are declined car finance, then the finance company will not approve a similar application from anyone at the same address, or anyone they suspect trying to obtain finance on your behalf as an accommodation deal. Your credit score will be marked accordingly, which means other finance companies will almost certainly reject your finance application as well.

Don’t rely on what a car dealer tells you

Car dealers often don’t help matters by tacitly accepting and assisting with accommodation deal applications, rather than simply rejecting them outright, which also puts them in a dangerous position with the finance companies providing the loans.

The terms and conditions of the finance contract will be very clear regarding an accommodation deal, so even if a car salesman tells you that it’s fine, he will be able to deny it all later while you’re the one left in a big financial mess. If you complain to the finance company, he will swear blind that you lied to him and there’s no way he would have submitted your loan application if he knew the truth. And there will be nothing written down, so you can’t prove anything.

Don’t commit fraud so someone else can drive a new car!

Whilst the concept of an accommodation deal is not illegal, the concept of fraud most certainly is. Finance companies have become very sensitive to accommodation deal agreements in recent years, and they are on the lookout for any applications which may be considered such. Usually as part of the terms and conditions of your finance contract, you will have to declare that you will be the registered owner and keeper of the vehicle, and that you are the main driver.

If you are applying for finance on behalf of someone else, and you do not intend to be the primary user of the vehicle, you will be lying to the finance company and that is considered fraud. In such circumstances, both persons involved (the one able to get finance and the one applying for it on their behalf) would be committing fraud by attempting to deceive the finance company.

Taking car finance for someone else is an accommodation dealIf someone asks you to apply for car finance on their behalf, the correct answer is NO.  In addition to the legal issues surrounding an accommodation deal as outlined above, money issues tend to destroy friendships and relationships.

Disclaimer
Most car finance agreements in the UK are regulated by the Financial Conduct Authority, and anyone involved in the selling of car finance must be accredited by the FCA.

You should always consider the terms and conditions of any agreement carefully before taking out any form of car finance, as you are making a substantial ongoing commitment and there may be significant costs if you change your mind or are unable to meet your commitments at a later date.

Stuart Masson
Stuart is the Editor of The Car Expert, which he founded in 2011, and our new sister site The Van Expert. Originally from Australia, Stuart has had a passion for cars and the car industry for over thirty years. He spent a decade in automotive retail, and now works tirelessly to help car buyers by providing independent and impartial advice.

168 Comments

  1. Do accomodation rules apply if you are a married couple who will share the vehicle use equally?

  2. stuart

    Hi Gemma. No, it should be fine; that’s perfectly common. The purpose of accommodation rules are to prevent someone who has failed a finance application seeking someone else to take the finance on their behalf. The only potential issue would be if you or your spouse have already failed a finance application, in which case the finance company may decline a similar application to the other half.

  3. Hi Stuart. My company has agreed to by me a car for personal use. They are willing to charge me zero % interest, with the monthly installment coming of my salary. The advantage for them is that it secures my services for the duration of the loan. For this transaction to be completed, I need to get hold of a contract that protects both parties. have you ever heard of an arrangement like this and where can I find a contract?

  4. stuart

    Hi James. I haven’t heard of a specific case like this, but it is certainly not uncommon for companies to fund purchases for employees and agree a repayment schedule. I’m surprised that they don’t have a suitable contract templace in place for this sort of thing if they offer it, but a solicitor should be able to get one drawn up for you.

  5. Hi Stuart, my partner was coerced into taking on accommodation deal by an ex-boyfriend two years ago. Although this character has paid her on time every month to date, we are worried that he might not continue to do so and we are also concerned about what to do at the end of the contract. I understand that this is a 3-year personal lease agreement (with Mercedes Finance). Ideally we would want to terminate the contract early, but have you any advice?

  6. stuart

    Hi Patrick. If you contact Mercedes-Benz Finance and tell them it’s an accommodation deal, they will probably want to terminate the agreement immediately anyway. However, this may result in them refusing to finance you again if you want another car from Mercedes-Benz. I am assuming that the ex-boyfriend has the car? If you try and terminate the agreement, the finance company will be coming to your partner to collect the car (since it is in her name), so she will need to get it back from the ex to give back to Mercedes-Benz Finance. This is where accommodation deals tend to go horribly wrong if the party with the car (the ex-boyfriend) refuses to return it to the party responsible for the finance (your partner).

    Your options to terminate early will depend on the type of finance agreement in place. If it is a lease, then terminating early usually has high financial penalties. If it is a PCP, you may be able to take advantage of your voluntary termination rights to give the car back, depending on whether or not you have repaid at least 50% of the total amount payable. But you need to have the car in your possession to be able to end the agreement in any case.

  7. What utter bullshit this article is, it assumes guilt where no guilt may lay. My son and myself are on benefits, we live in the countryside and my ex wife I live in the same house although we are divorced as friends and our sons live in the same house, my son is my carer and also because buses don’t run after 5pm is desperate for a car to use as am I to get out of my home, what is wrong with my ex wife leasing a car or buying it so that everybody including herself can benefit from it for being taken to the shops work, hospital to see relatives etc. So I feel that a working person who has the available funds should be entitled to have a car if they want it and for other members to share the driving and fueling of that car. I think this arrangement deal is just paranoia, the car will still be insured and the finance company will be paid.

  8. stuart

    Hi Leslie. It’s not bullshit at all, and I think you have got the wrong impression. There is nothing wrong with a person buying & financing a car in their own name and allowing other people to drive it. What would need to happen is that your ex-wife would need to buy, finance and insure the car in her own name. Anyone else driving the car on a regular basis should be named on the insurance policy.

    The accommodation deal policy is aimed at stopping a person financing a car that they have no intention of driving themselves, but are simply financing on behalf of another person who can’t finance under their own name.

  9. andrewtaylor

    Wow Leslie. Calling bullshit without knowing your ass from your elbow, nice work. Why don’t you lose the self entitled attitude that seems to come with a benefits handout and use all that spare time that comes from not having a job to think about what you are saying? Your situation sounds like your milking the world anyway so its not surprising you think you deserve car finance as well. Its people like you who make life more difficult for the rest of us who have to work for a living.

  10. this isn’t all correct,
    I have a car on finance and we even spoke to the financing company and said look yes the car will be financed in my name but my mum will be the main driver, all they asked was that I at least be a named driver, which i am anyway so that was no problem with us,
    but the thing is i couldn’t be main driver anyway because i am only a learner, and they knew this considering in my application i gave them a provisional licence.
    (this is taking into account i live with my mum currently)

  11. Hi Stuart, I a car on finance for my brother back in 2006 and he stopped paying me, I have now been summoned to court and will have to pay £9500 + and get a ccj. Well disappointed and probably can’t do anything about it :(

  12. stuart

    Hi Jason. Unfortunately, your situation is the very embodiment of why finance companies will no longer accept these arrangements. Best of luck.

  13. stuart

    Hi Charlotte. Your situation is a bit different in that you will still be driving the car and it will presumably ultimately be your car. The rules are designed to circumvent Person A buying a car for Person B (who is unable to get finance on their own), with no intention of driving the vehicle themselves

  14. Hi Stuart, I was wondering if you could advise on something, I recently financed a car with the intention of it being a shared family car for me and my partner, iv just been given a company car so my partner will drive our car more than me I was wondering if she could be insured as the main driver with me as a named driver even though the car and gap insurance are in my name? Our current insurer have said no as my partner would need to be the registered keeper of the car? Any help greatly recited

  15. stuart

    Hi Chris. Usually the finance company and insurance company will want to see that the registered keeper is the main driver. If it is a family car, then it shouldn’t be too much hassle to keep you as the main driver and list everyone else who is going to be driving as named drivers. The rules are aimed at stopping accommodation deals as outlined above, where the person financing the car is not ever going to have use of it.

  16. Hi Stuart
    What is the problem if my son finances a motorbike, he is the registered keeper and I am named as a rider of the bike ?

  17. Stuart Masson

    Hi Michael. That should be fine, assuming that your son is going to be riding the bike as well, and assuming the bike is kept at his address. It becomes an Accommodation Deal if he is buying and financing a bike that he has no intention of riding himself (ie – he’s buying it on your behalf because you can’t get finance).

  18. I went with my partner because there was a recall on a part of a car that we own. While that was being fixed we had a little wonder around the show room to take a look at the cars. We had been thinking of part exchanging and buying another for both of us to use.
    We approached by a salesman and we got chatting. He started making quotes and giving us the sell. It turned out that the deposit on a new car would be the same amount we were due to pay in service/MOT. We explained our circumstances, work, driving experience. I told them that I was going to start learning to drive soon.
    We decided to put the finance deal in my partners name because up until Dec'14 he had been unemployed and I have been responsible for everything. We are slowly dividing up responsibility for bills. Unfortunately, he was declined 2 weeks ago without any explanation. When he spoke to the salesman, the salesman felt it was a good idea for me to apply for the finance in my name. I was accepted at first but then they asked for my driving license. I told them that I'm not sure if I could produce it, or if it was valid because 1) it is a provisional and 2) I got it 17 years ago. They said it would be OK and all I had to do was scan it and email it to them. I found it and did just that. A week passed and nothing. My partner contacted them and they told him that I had been approved but then declined because the insurance company felt it was an 'accommodation deal'.
    Surely, the salesman should have been aware of this at the beginning. Their actions/advice have caused both of us to have a black mark on our credit rating.
    Before my mum returned to work my dad would take out finance so that my mum had a car to drive.

  19. Hi basically my sis wants to get a car on finance witch she has a provisional licence and she wants to share the car with me we both live in same address is this possible an how will it work in insurance wise

  20. Stuart Masson

    Hi Huss. This shouldn't be a problem, as long as the car is registered in her name, the insurance is in her name and the finance is in her name. You need to be listed as a named driver on the insurance if you are going to be driving the car regularly.

  21. Hi Stu,

    My son got turned down for finance when he went to buy a car and he called me from the dealers and asked me if I would be guarantor on the loan and he could then get it. I reluctantly agreed, and gave him all the details he asked for on the phone. I then drove to the dealers (a very well known second hand dealer). When I got there my son told me that the APR rate for finance with his name on it was still very high, and asked if could I finance it for him. I was on the spot and under pressure,really worried, but as his pregnant partner was there, again reluctantly , I agreed.
    I read him the riot act – 'if you dont pay, i'll tke back the car and sell it, etc'. He promised faithfully he would repay. Gave the salesman, who was aware of the arrangement that was happening, my passport for ID, signed and it was done.He drove off in the car, everyone (fairly) happy.
    The original car registration came to my house as I expected, (I seem to think my sons name was on it). I handed it over, so my son could 'admisiter' the vehicle as the keeper/main driver.
    My son made payments to me, through the bank, but after 3 months they stopped.
    Then I couldnt get hold of him, for months, but eventually I did. I told him I wanted my money and got a sob story, but relented and was expecting repayments to restart. They didn't – I went back, and was prepared to take the car, but It wasnt there. I demanded either the money or return of the car, got more sob stories and no money or car. I stopped paying the finance, and when I called the finance company, they told me I was liable. I said I dont care, repossess the car. They declined and sid its a personal loan!! They were not interested in the car, my problems or where the vehicle was, pay up! I had to reinstate the payments.
    I went back, time after time, no luck, he moved again and I got no forwarding address. I then found out he had sold the car.
    I told the finance company – we dont care.
    I went to the police – its a civil matter.
    I am now in a right mess, finacially emotionally and personally – this is a common problem, people need to be aware. The dealers flout the rules, the finance companies are unsypathetic and the police are powerless.
    WARN YOUR READERS – NEVER, EVER FINANCE SOMEONE ELSES VEHICLE.

  22. Hi,
    I got rejected due to my addresses being wrong on my bank to my current address, so my partner stepped in (after the advice of Audi) and then we got approved but obviously finance is in her name but the car is in mine, now I know this is not what finance company like so is our only solution to put everything in my partners name even if i'm paying for everything and the main driver, including insurance policy holder?
    Thanks.

  23. Stuart Masson

    Hi Buz. Sadly, your story is not that uncommon, and it happens for a variety of reasons. This is why finance companies have become very strict about not accepting accommodation deals. I hope you can work your situation out soon.

  24. Stuart Masson

    Hi Max. The advice from Audi seems odd if it was a simple admin error if your application was otherwise fine and you could provide alternative proof of your address. Making the purchase and finance in your partner's name (which is ultimately an accommodation deal, even if it is acceptable to them) seems like a riskier move for them. It may even be that the finance company rejects an application from your partner as well (if they sense an accommodation deal), regardless of what the dealer suggests.

  25. Hi Stuart

    I reluctantly took out finance on an Audi for my girlfriend, she was declared bankrupt by somebody leaving her when she was in possession of the debt, so never thought she would do the same to me. How I was wrong! My question is, I am down as the person responsible for paying the finance and am the only named person on the loan agreement. She is the only party named on the V5C Doc. I'd like to know if I am the legal owner of the vehicle. She has took off with the vehicle, so my thinking is, if I am it's technically theft and I should be able to get the vehicle back

    Thanks

  26. Stuart Masson

    Hi Chad. Unfortunately you are probably not the legal owner of the vehicle – if the finance agreement is a PCP or HP, the finance company retains ownership of the vehicle until the final payment has been made. With a PCP or HP, the finance is secured against the vehicle. This means that the finance company can take action to reclaim the vehicle if you stop paying, but is limited in taking action against you personally to recoup their losses (ie – they can't force you into bankruptcy). However, if you refuse to hand over the car then you could be considered to have stolen it. The finance company has no recourse against your (ex-)girlfriend and they will chase you rather than her.

    If it was a personal loan, the finance is unsecured and you are personally liable for the finance – the car is irrelevant. The finance company can basically drive you into bankruptcy if necessary to get their money back. In this situation, the contract of sale for the car is the only proof of ownership. If your name is on that piece of paper, you can argue that you are the legal owner. However, if you gave your girlfriend the keys to the car or ever allowed her to drive it (which you obviously did, since you were financing it for her), you have virtually zero chance of getting it back.

    Either way, you're probably screwed. Sorry.

  27. what about someone who like myself has a lease and can't afford the car anymore but I have someone who wants to take it over but wouldn't be approved to have it in her name?

  28. Stuart Masson

    Hi Arthur. No, the finance company almost certainly won't allow it.

  29. Hi Stuart

    I really need some help please – don't know what to do for the best?

    Both my wife and I knew we wouldn't get credit for a new car – so the salesman at Seat suggested we ask my wife's mother to do it in her name. He said he could set the D/D up to come out of my bank account (rather than mother-in-laws) as the finance company "wouldn't know any different".

    Now, after reading this thread, I have no idea where we stand in relation to insurance, ownership etc? I changed the logbook to my name so I am the registered owner – but who owns the vehicle and how can I correctly insure it?

    Help!

  30. Stuart Masson

    Hi Eddie. The SEAT bloke was well out of line if the finance is with Volkswagen Financial Services, as they would not allow it. Should the finance company find out, they are likely to try and cancel the agreement.

    The finance company is the registered owner of the car until the finance is all paid off, so neither you or your mother-in-law is the registered owner – you are the registered keeper. However, the finance company has not authorised you to be the keeper of the car, so your MIL will be in breach of her agreement. Get the contract out and read it thoroughly, as it should cover it in there.

    You should transfer the V5 logbook back to your MIL and have her insure the car (listing you and your wife as named drivers) – that should cover you for insurance purposes.

    As for the finance agreement, you can either come clean to the finance company or keep paying it off and hope they don't notice. If you go to the finance company, you would probably be best placed to do it as a whistleblower and lay the blame on the dealer for misleading you. You won't be able to escape the fact that it is quite likely to all be spelled out in your contract and therefore your mother-in-law shouldn't have signed it, but they will certainly be aware that most people never read their contracts anyway. If you go this way, you should do it as soon as possible and make it clear that you have only just realised that you have been misadvised.

  31. Thank you for that Stuart – very helpful.

    First and foremost I will sort the logbook and insurance – I guess our insurance for the past three years has not been worth the paper its written on – which is a major concern.

    This is the SECOND car in three years we have had from the same dealership with the same advice both times. I now feel we were definitely misadvised – but I guess the signed paperwork will cover Seat.

    Luckily nothing has happened from an insurance point of view – but it is a sickening thought of "what if".

    I will hurriedly try to make amends – thank you.

  32. P.S I had a thorough read of the contract Stuart and can't see anything relating to changing registered keeper etc. That being said, I only have a copy of the "Pre-Contract Credit Information" (which doesn't even mention my MIL's name).

    It appears we were never given/sent a full contract.

  33. Hi my brother would like to pay my car but I won't be driving it has much so he's decided to take over payments it's a pcp deal ,I would prefer to make him the registered keeper and me has a named driver ,Would this be ok either though the finance is in my name

  34. Stuart Masson

    Hi Katy. Your finance agreement will probably tell you that you need to keep the car registered in your name, but you can add your brother to your insurance as a named driver.

    You are ultimately responsible for paying off your PCP, even if your brother is helping you with the payments. If you transfer that responsibility across to him and the finance company finds out, you will be in breach of your contract and there could be significant penalties.

  35. Yes I understand that but at the end of the agreement my brother is paying the full amount of that's left on the pcp ,If he takes insurance out fully comp and me as a named driver but car still registered in my name but I'm a named driver and still on the insurance just he is at a different address where the car mostly will be present

  36. Stuart Masson

    Yes, but you're not allowed to do that. What you and your brother would like to be able to do is largely irrelevant; it's all about what your contract with the finance company says.

    If you want to settle the agreement now and pay it all out using your brother's money, then that's fine. But until it is all paid off, the vehicle still belongs to the finance company so they get to make the rules. And unless the finance company you are using is different to all the others, they will say the the V5 book must be in your name, you have to keep the vehicle comprehensively insured in your name (with other named drivers allowed), you have to be the main driver and the vehicle must ordinarily be kept at your address as on the V5.

  37. What rights does my ex-partner have taking over ownership of my finance deal with the garage for the car, If her credit rating is bad and I'm not bothered about continuing payments.

  38. Stuart Masson

    Hi Jim. The finance agreement remains your legal responsibility until it is completed. You cannot transfer ownership of the finance or the car to anyone else.

  39. Hello my friend is going through a seperation, is it legal for her spouse to buy a car under both names without her consent or being present to sign the loan papers?

  40. Stuart Masson

    Hi Bob. I'm not a legal expert, but I doubt it would be acceptable for anyone to sign anything on someone else's behalf without their consent. Head to http://www.legalbeagles.info and ask on the forum there, as they will probably be able to help.

  41. Hi wonder if you can help there is a d2bt order on my car but the debt is in my name. At the time of getting the car i could not get finance so my dear mother sais she would do it. Anyway she managed to get an unsecured loan, my question is who does the car belong to. My mums name and details are all over the agreement so does the car belong to her.

    Thanks

  42. Stuart Masson

    Hi Graham. If your mum's name is on the vehicle order and invoice, then the car belongs to her.

    If her finance was a personal loan not secured against the car, and she used the loan money to pay for the car, then the car belongs to whoever is listed on the invoice (eg – you or her). If the finance was a secured loan (eg – HP or PCP), then the car belongs to the finance company.

  43. Hi Stuart

    I would appreciate your advise. I am planning to buy a car on HP It will be shared between my wife and I, if i take out the finance can the car be insured with my wife as the main driver and me as a named driver? from reading the paperwork i need to be the registered keeper. Help

  44. Stuart Masson

    Hi Jezza. Yes, you will definitely need to be the registered keeper. With your insurance, some finance companies are stricter than others. Generally, they all like the same person listed on the finance, V5 and insurance form. Some will be happy with you listed as a named driver, others will want the insurance in your name with your wife as a named driver. Given that you are married and (presumably) live at the same address, it probably won't be a major problem.

  45. I can't get finance so my father-in-law got the finance in his name but I pay the monthly payments, I've never missed a payment and don't intend to. On my insurance I have put him down as the owner but I am the keeper. The finance is in his name and address and the insurance is in my name and address. I now have to many kids to fit into the car and need a bigger car, I phoned the finance comp to get a settlement figure she then asked why the finance was in F-I-L name so I explained and she said she don't know why the finance is in his name as its accommodation fraud! So now she knows I've gotta settle the account asap… Why wasn't we told at the beginning? I've felt with the finance comp at the start of the agreement as the car had a major problem so I was on the phone a lot so I had to be put in the account so I was allowed to talk about it. We have been honest from day one about us not being able to get credit etc (to be honest we didn't know it wasn't allowed) so now I can't get a new car???

  46. Stuart Masson

    Hi Emma. It's becoming a bigger problem, and finance companies are tightening their rules because dealers haven't explained it properly, which sounds like what has happened in your case. I was working in UK dealerships for nearly four years before I found out it wasn't allowed, simply because the finance managers never really discussed it or were encouraged to keep it quiet. This is now changing, and finance companies are now ordering dealers not to entertain accommodation deals under any circumstances – with severe penalties if they are caught trying to do so. As explained in the article above, it's not a legal issue as much as a policy issue because it is more likely to cause greater risks and lots of problems.

    There should have been a clause in the finance T&Cs where the applicant declares that he/she will be the owner and main user, and that they are not taking out finance for someone else, so the finance company can argue that your father-in-law knowingly committed fraud. In reality, it can normally be worked out without the finance company taking action against your or your father-in-law to affect credit ratings or prevent future finance. The finance company does not want to go through any hassle with reporting fraud (which is a criminal offence), so they should be happy to have the matter resolved promptly.

    Yes, you and your father-in-law are going to have to sell the car and settle the finance. As long as this happens promptly, the finance company can close off the agreement and not pursue anything further. However, you almost certainly won't be able to get another car in the same way as finance companies and dealers are much stricter about applications now than they were even a couple of years ago.

  47. I just bought a car in my name and my finance for the purpose of my daughter having a car to drive when she passed her test. On passing her test the insurance is out of this world for me as the named driver, my wife and my daughter on the insurance. However if the vehicle is registered in my daughters name with my wife as a name driver then the insurance becomes affordable. Can I change the registered keeper of the vehicle whilst maintain the payments for the finance myself?

  48. Stuart Masson

    Hi Justin. Check your finance agreement, but probably not. Usually the V5 and insurance must be in the same name, and at the same address, as the finance agreement.

  49. The company I work for is looking to supply me with a vehicle for my personal use. The three company directors do not wish to put this through the business and are willing to split the cost of the lease between all three of them, with one of them having their name on the contract. Am I able to insure the car as myself as the main driver? Thanks

  50. Stuart Masson

    Hi Kelly. I would say probably not, and it also doesn't sound like a very solid deal for you. Even if they can work it out so that it's not an accommodation deal (unlikely if they are not running it through the business), it is still dependent on the three of them continuing to fund it over a period of years.

  51. I am planning to buy a new car for my wife as a suprise. I will drive the car but she will probably drive it more than me overall (although she doesn’t use it for work commute so it will be close between the two of us in terms of miles driven) so think for insurance purposes she will need to be the main driver. If I take a pcp deal in my name and have an insurance policy with her as main driver is that OK?

  52. Stuart Masson

    Hi Alex. That should be OK, as long as the insurance policy is in your name.

    Finance companies tend to be more relaxed about married couples (as long as you are actually still together!), because a lot of the finances are shared anyway. As long as you are not trying to deceive the finance company in your application, there is not usually too much trouble.

  53. Thanks Stuart. I will then make sure the insurance policy is in my name. I expect we would both easily pass any credit checks but this means I can keep it as a surprise which isn’t vital but more fun to do! Cheers

  54. hi, my boyfriend bought our car 3 weeks ago. drove miles away to collect. the garage knew it was only going to be me driving the car as my partner couldnt get insured because of points on his license. a week later finance company call saying he needs to be insured or the car is getting taken off us? what can we do?? we knew nothing about this. also the garage registered the car in my name knowing the finance was in my partners name.

  55. Hi Stuart. My partner got rejected on a lease deal. She would have been main car user and myself other user. We got told I cannot now apply for a lease car as I am at the same address. Is this correct?

  56. Stuart Masson

    Hi Maisie. Well, you will probably have to pay a fortune to get him insured or give back the car. It’s not your car, it’s the finance company’s, and they make the rules. Even if the dealer did not tell you, it would have been written into the finance agreement. Yes, the dealer is a jerk, but it is the responsibility of the buyer to read everything before signing.

  57. Stuart Masson

    Hi Liam. Yes, this is correct. If you now apply for car finance, the finance company will automatically treat it as an accommodation deal and decline you.

    This only applies to that particular finance company. There is nothing to stop you applying for finance from another provider, but as part of the application you are expected to declare that you are the main driver. If you knowingly make an application for a car that your partner will be driving, it’s still an accommodation deal and you are technically committing fraud.

  58. Hi quick question me and my boyfriend went to a car company and explained we were looking for a cheap car o finance we explained tk them the finiance would be in my name as i have a better credit score also explained i wudnt be drinving the car which they were well aware ofas they had to take my passport for id …does it mean the car companh afr in the wrong n i have to give the car back or wud we be in troube even though we told them what are llans were..5 year lease and only paid 1 and half years so far

  59. Stuart Masson

    Hi Tasha. It will depend what your finance agreement says. If you have signed a contract which says that you are the main driver, then you would be in breach of that contract. If the finance company doesn’t have a problem with it, then you’re fine.

    It won’t really matter whether the dealer was right or wrong, as they sell the car to the finance company, and the finance company then mortgages the car to you. So you are currently driving around in the finance company’s car, and if you are breaking their rules then they are entitled to take it back. It doesn’t mean that it will definitely happen, but it could.

  60. If it is incontract i have to be amain driver does that mean i would have to hand the car back would i have to pay anything aswel on top l??

  61. Stuart Masson

    We can’t second-guess what the finance company would choose to do. However, if they choose to terminate the contract then it is unlikely they could charge you for anything else, unless there is damage or you have not serviced the car correctly.

  62. Hi Stuart,

    I approached a car dealer as I wanted to upgrade my vehicle. As my previous vehicle was in my sisters name, and had been for 3 years, with the car dealer knowing this, I attempted to get the new car financed in my name but failed due to poor credit. The dealership asked me if my sister or anyone else would finance the vehicle for me, I then asked my sister (who lives in a different property) and she kindly offered to finance the car again and I part exchanged the vehicle I had and put money on top of this deal too to the total of £12500. The dealership also put the log book in my name as they identified me as the owner of the vehicle and I also produced insurance documents with me as the main driver. I have had the car for 6 months now and have never missed a payment.
    The finance company came to my property to seize the car stating that it had been obtained fraudunately. I tried to explain that we was told to finance the car this way by the dealership but this was fallen on to deaf ears.
    If this is illegal, I have no problem giving the car back. I do however would like to know who is responsible for returning my deposit that I put in at the start of the deal?
    Would really like some advice!

  63. Stuart Masson

    Hi Aysha. I think you can safely wave goodbye to your deposit. It’s not refundable or returnable, it’s an up-front payment on the vehicle, which is then followed by 36 monthly payments of £x.

    Unfortunately, the finance company will not care about what the dealership may or may not have told you, as you have found out to your cost. If you have something in writing from the dealer to back up that claim, then you could take action against the dealer (not the finance company, unless you can argue that their agent – the Business Manager at the dealership – has missold the finance). However, the chances of this being the case are usually slim to none, as dealers are savvy enough never to put such advice into writing.

  64. Hi Stuart,
    I have a car that is financed in my name but it is for my sister. My parents are paying the note on the vehicle. We all live in the house together and we are all listed on my mom’s insurance together. I am looking to get another car for myself because my current car is about to go out on me. Do you think that the car dealer would finance another car for me? If not, what advice could you give me?

  65. Stuart Masson

    Hi Felicia. It’s difficult to predict whether the finance company would approve or decline your application. If it is the same finance company, they may question why you want to finance another car when you already have one on finance with them, which means they may start looking at your file to find out more about your current car. A different finance company may not have the same issues, as they won’t be able to see the detail of your current agreement.

    Your current finance agreement sounds complicated – the car is in your name, but it’s for your sister and your parents are paying for it. My advice would be to get this finance agreement completed before starting another one, as there is plenty of potential for things to go wrong.

  66. Hi, my wife recently purchased a car on a pcp, the car was put in my name and the insurance is in my name also, the finance is in my wifes name though, the car sales company I use to work for were made aware of this before my wife made the purchase and all documents got sent to admin to be processed, there was a note asking for the vehicle to be put in my name, at no point was I made aware this was not legal? What rights do we have in this situation? Thank you

  67. Stuart Masson

    Hi Mark. The issue is not that it’s illegal, but it’s usually against the finance company rules.

    It may be that the finance company is happy with the car being in your name while the finance is in your wife’s name, but that’s not normally the case. If you are still married and living together as a couple, the finance company may be content with everything as it currently is. If the dealership has told the finance company that the car is in your wife’s name, but actually registered it in your name (ie – the dealer lied to the finance company), that may be more of an issue.

    You said that you worked for a ‘car sales company’. It may be that the car had to be in your name to get a certain discount available to employees. In any case, it’s only an issue of legality if you are knowingly providing false information to the finance company about your finance application.

  68. Hi Stuart,

    Slightly nuanced question here…what if I am buying a car as a gift for my father? I never expect him to pay for it…ever. It’s my loan and my obligation. While very similar to your article, there is a slight difference in that it’s never really fraud. Is that something I just disclose?

    Thanks and great job replying to everyone’s comments…that’s a rarity.

    Jake

  69. Stuart Masson

    Hi Jake. It probably wouldn’t be allowed, but you could ask the finance company for their advice before you make an application. Preferably call the finance company rather than asking the dealer, as they won’t necessarily know the answer.

    It’s not fraud if it’s disclosed and you comply with the contract. If they don’t like it, they won’t offer you finance. It becomes fraud when someone signs a finance agreement which says that the car is for them, but really it’s for someone else.

  70. Hello,

    I recently brought myself a car on finance through a garage who set the finance up for me through a different company. Now when I showed my Provisional license the guy asked me if that’s all I had and I said yes and he asked me to call him and I did and he explained that some fianace company’s won’t accept me because of it but managed to get me finance on the car anyway but now the finance company have found out I have a provisional license and want me to settle the full amount and I simply can’t. Do I have a leg to stand on?

  71. Stuart Masson

    Hi Richard. Probably not, but it will depend on what is written in your contract. If it’s not set out in your finance agreement that you have to have a full driver’s licence, then they can’t use it as an excuse to cancel the contract. The written agreement is what matters – what the salesman at the dealer said will be considered irrelevant.

  72. Hi need a little help, my partner has just got me a car out on finance in his name, the finance company knew this & was wondering whether I would be the registered keeper as I am a new drive & want to get my own insurance out

  73. Stuart Masson

    Hi Laura. No, normally the finance agreement, insurance and vehicle logbook need to all be in the same name (ie – your partner’s).

  74. Hi Stuart – I purchased a car for my parents as a Christmas present for them with 5,000 on finance. None of the above was mentioned when sorting out the finance with the company, now, their insurance company need the car in their name (or me as main insured). Question is, if I change the name of the car to my parents address further afield, will the finance company find out about this? Or, shall I call them and see what their response is… The downside is, I can’t afford to pay off the agreement if this is not allowed.

  75. Stuart Masson

    Hi J. You’ll have to discuss it with the finance company. Because it’s not a huge amount of money compared to the average car finance borrowing, they may be fine with it – especially if you lay it on thick about how you weren’t told about it during the application. No guarantees, though; you do run the risk of them wanting to cancel the finance agreement altogether.

  76. Wondering if anyone can tell me if I can get car on finance in my mums name?
    I’m 17 and taking my test in a couple of months I earn enough money to pay the monthly payment myself but I have been told I have to be 18. I was trying to find out if my mum can take out the finance for me and I pay her the money but my mum does not have a driving licence and I know most need one for finance.

    Thanks

  77. Stuart Masson

    Hi Hollie. No, probably not. Getting car finance when you don’t have a driver’s licence is fairly difficult, as it immediately falls under accommodation deals.

  78. Hi everyone, some very interesting stories here, but i have a scenario i would like some feedback on.

    My son is nearly 19 and wants to buy a decent car but fears he may not get the finance (he has a good full time job)

    Here is my idea:
    Car finance in my name (DAD)
    Registered keeper (DAD)
    Finance payments made by SON (SON’s bank details given to finance company as part of the agreement)
    Insured by SON (in his name) as main driver but with DAD and MUM as named drivers

    Would this work? This would be basically to ensure he gets the car, if he tried it in his name (with no credit history) he may be refused and have a rejection on his credit file.

    Thanks for any advice.

    Paul

  79. Stuart Masson

    Hi Paul. Unlikely that you will be able to do that, as it is a clear accommodation deal. It may be possible for him to get finance with you as a guarantor, rather than you getting the finance in your name.

  80. Hi, I have quite a awkward situation going on with my finance company.
    I signed the agreement with them about 2 weeks ago and yesterday they called me that I have to give the car back to the dealership because they aren’t paying for it. The reason that they gave me was that I need to have a full uk drivers licence, not a provisional as I currently have. In the agreement between me and the finance comp there is nowhere stated this, but they insist that is the company’s policy or is in the agreement between the finance comp and the dealership.

    I told them that I don’t understand where is my problem because I disclosed everything to them and the dealership knew that I have provisional and they said that everything is ok. They even made a copy after it and checked it.

    Can they void the contract on this thing, even if it’s not the t&c of the contract?

    I am the registered Keeper on the V5c and a secondary driver until I obtain my full licence.

    Thank you

  81. Stuart Masson

    Hi Diana. It is true that most finance companies require a full driver’s licence for a PCP or HP. It is something that the dealership should have known and explained – so either they were ignorant of the finance company’s policy or they hoped no-one would notice.

    The finance company has the right to terminate the contract. If you want to dispute this, or claim against them for any financial loss as a result, you will to take action against them. Try visiting legalbeagles.info, or seek your own legal advice.

  82. 14 months ago I purchased a car as my partner couldn’t get the finance. At no point did the dealer explain any of the above! The car/Insurance is in my name with my bank details and my partner just transfers the money into my account every month. Problem is now my company car is being taken from me and i need to purchase my own car! Will i be able to transfer the finance and car to him if he passes the credit check?

  83. Stuart Masson

    Hi Chris. You can’t transfer a finance agreement to someone else. You would have to settle the current agreement first before you do anything else.

  84. Thanks for the swift response. Have you got any ideas as to how i can deal with this? Is it a case where in effect i sell him the car, so he finds another finance company?

  85. Stuart Masson

    You will need to find out the settlement amount from the finance company. He could take out a personal loan to pay for this, and then you transfer the car into his name once the finance has been settled and the finance company confirms that they no longer have any interest in the vehicle.

  86. Hi Stuart

    My brother’s girlfriend bought a car on finance on her name for my brother. Although he has made every single payment per month via a bank transfer to her’s for the last 3 years. He is the main driver with the log book insurance etc in his name. They have just broken up and she has had the car towed away as it’s in her name under Finance agreement. How can he get the car back?

  87. Stuart Masson

    He can’t. It was never his.

  88. Hi I cannot get finance, so my dad has offer to buy me a car on finance but I will be the main driver, can the car be registered as mine?

  89. Stuart Masson

    No.

  90. A friend of mine has got fiance on a car from a company that specifically deals in the learner car business. He has got this car on fiance for his father, the one who runs the leaner driver car. Am I right on saying, two fold, 1. The fact he’s got the finance for his father is a little bit naughty, but, 2. The fact that he has got the fiance on a car for his dad to run a business is very very naughty. The friend was contacted by the finance company because the car was registered, taxed and insured in his dads name. He was told that these 3 areas needed to be rectified. The friend has changed the tax and v5 into his name but I’m not sure about the insurance because of the fact that his dad is using it for business use. The dealer who arranged the finance has obviously let this go ahead. If anything comes back onto my friend, again, am I right in saying that there is a very strong possibility that my friend can be done for fraud, 2 fold?

  91. Stuart Masson

    Hi Richard. I don’t know what the chances are that the finance company would want to go down the path of having your friend charged with fraud, which would be complicated and expensive to prosecute, but they would almost certainly cancel the agreement and demand full payment immediately, as your friend is in breach of the contract T&Cs.

  92. Hi Stuart,

    I would appreciate your advice. I took out a finance agreement in my name on behalf of my boyfriend last year. At the time, he was in an IVA and would not have been approved, despite the fact he earns 40k and can easily afford the £160 monthly payments (the car was only around 3k). Anyway the dealership knew I was taking the finance in my name and actually asked us who we wanted the car to be registered to. We decided my bf as I have my own car etc and had no interest in using this car. At the time we didn’t live together. We weren’t made aware this was an issue.
    We have now decided to sort our finances better as we have bought a house (the house or mortgage is not currently in my name, just his whilst I clear my debt) and we have decided the sell the car I financed. I phoned the finance company to get a settlement figure and when asked was I the registered keeper I said no (didn’t realise it was wrong). The lady has now stated I’m in breach of contract and whilst she sympathises I wasn’t made aware from the dealership she has to pass this information on to her management and they will be in touch. It also now sounds dodgy because we are both now living at a new address (we moved literally a couple of weeks ago).
    I was upfront and honest about everything and have not missed any payments nor intend to and have even paid bulk amounts to get the finance down however I understand the finance companies viewpoint on it.
    She said I can transfer the logbook into my name and insure myself on the car when they contact me back however this isn’t an ideal option as just last week I was hit in the back of my own car and currently have a claim going through (even though the third party have accepted liability I feel my premiums in the interim are going to go up until the claim is closed).
    What I want to know is 1. Is my boyfriends insurance valid on this car and should he be driving it (he’s had no problems taxing it though) and 2. Despite the debt I have I have an excellent credit rating…I’m 30 years old and have never missed a payment on anything…is something going to be issued against my name? My mum has recently come into a bit of money and I’m thinking about asking her for the outstanding balance and just paying the finance company the settlement figure, sell the car and and pay my mum back…would they accept this?
    Thank you
    Heather

  93. Hi all
    Some very interesting information on here.
    I am desperate for help and guidance please. My position is this,
    My partner is in an IVA and has been for a few years so was unable to get any finance. His friend took out car finance for him 12 months ago, obviously both living at different addresses. Payments go out of friends account, with my partner paying every payment in cash, never missing. My partner is also the registered keeper and has his own insurance etc in his own name.
    We have been told that the finance company are now aware of this!! What will happen. Will they close the finance and take the car? We are not in a position to pay the finance off, what options do we have, if any?

  94. Stuart Masson

    Hi Heather. It’s quite possible that the finance company will insist on cancelling the contract or asking you to settle the finance immediately, as you are in breach of contract. Unfortunately, it doesn’t matter what the people at the car dealership did or didn’t tell you; it would have been written into the contract that you signed.

  95. Stuart Masson

    Hi Lisa. It is quite likely that the finance company will cancel the contract and ask for the immediate return of their car, and it will probably affect your partner’s friend’s credit rating.

    Alternatively, the company may demand that the outstanding balance be settled immediately and in full, meaning that your partner’s friend will have to come up with a lot of cash in a short time. Or if the company doesn’t want to take such drastic action, it may insist that the logbook is transferred to the friend’s name, and that the car is kept at the friend’s house (and also insured in the friend’s name). Basically the friend is the one who is supposed to be driving and taking responsibility for the car, which still belongs to the finance company.

  96. Hi, I wonder if you can help? Four years ago my business partner took out a pcp on my behalf (as I can’t get any finance and need a car for our business), so he is down as the registered owner, I’m down as the registered keeper on the V5 so I pay the insurance, road tax and all the running costs. The agreement is up in a week or two and the dealer has told me that they are not allowed to do this any more as the law has changed, is this right. No payments have been missed. The car was a year old at the time as would be the replacement. This will potentially mean I’m going to be without a car which in turn means the five people I employ might be without work if I can’t get out to bring new work in. Aaahhhh! Surely there must be a way?

  97. Stuart Masson

    The dealer is correct; most finance companies will not allow these types of finance agreements anymore. That’s the very point of this article.

  98. Hi,

    I got a provisional licence 15 years ago (so am assuming this has expired now?) however I haven’t ruled out learning to drive at some point. I’m looking to buy a car through hire purchase for my fiance as a gift – I will be paying the monthly payments etc in exchange for him driving me around. Is this possible, given I still may learn to drive in the future at which point I would add myself to his insurance policy?

  99. Stuart Masson

    Hi Meg. You can’t use a hire purchase if you are not going to be the main driver, but you could get a personal loan instead (and the interest rate is usually lower).

  100. Hi, I am looking for some advice. I have had a car lease for over 2 years and now, because of a change of circumstances, there are too many cars in my household. My mother however really needs a new car. Can I lend her my lease car indefinitely (no longer than the end of the lease, naturally)? We don’t share the same address and I intend to keep making the paymen’s myself. Is there anyway that can be done without breaking any regulations? I appreciate your help. Thank you

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