Getting new car finance in a parents name

[Johnboy123]

hi everyone,merry xmas,need a bit of advice.Ive usually got cars in my mums name pcps,she on the insurance as a named driver and in the gap insurance.Im planning on swapping but my last car was on my name,but was looking to do it again on my mums name.Im not really getting any answers,but I'm wondering is it legal?

 

[Cro]

Don't see why it wouldn't be legal. You can put finance in anyone's name, then insure and register in another. As long as she's ok with it and will be there to sign the documentation plough away

 

[Boabybooster]

You have to be the main driver on the insurance I think, if not, its classed as fronting, have you got your own no claims?

 

[Johnboy123]

Don't see why it wouldn't be legal. You can put finance in anyone's name, then insure and register in another. As long as she's ok with it and will be there to sign the documentation plough away

Great,She's happy enough like,has done it on many cars for me.its all above board like.

 

[Johnboy123]

You have to be the main driver on the insurance I think, if not, its classed as fronting, have you got your own no claims?

Yes I have my own no claims,it been built up over the years.

 

[chris_b]

This is really straight forward and something a lot of dealers do wrong.

Basically on a logbook you ensure the owners & keepers details are different and correct.
It's absolutely no different to someone financing a car for their kid but it is the kids car so owner is the parent and keeper the kid. Insurance wise kid as main user and parent must be on policy as well.

 

[Boabybooster]

Yes I have my own no claims,it been built up over the years.

Well as long as you're named as main driver and your mums on the insurance as an additional driver, don't think the Pcp being in her name is a problem. You don't own a car on a Pcp anyway till its paid, her name will be on the v5 so when you insure it, you just state you're not the registered keeper, that way you're all above board.

 

[Chris_702]

Financing a car in someone elses name is illegal. Its called 'fronting', if a finance company finds out they will give you the option to return the vehicle or pay the balance due in full to avoid losing the car.
While many people do it, to avoid being caught ensure the vehicle is registered in the same name as that on the finance agreement - this is how they catch onto most 'fronted' deal.

 

[Johnboy123]

This is really straight forward and something a lot of dealers do wrong.

Basically on a logbook you ensure the owners & keepers details are different and correct.
It's absolutely no different to someone financing a car for their kid but it is the kids car so owner is the parent and keeper the kid. Insurance wise kid as main user and parent must be on policy as well.

Thanks,the insurance will be on my name.ive done before.but someone tried to say it was ilegal.my mum always been a named driver.and I always makes sure the car I drive are totally legal.

 

[chris_b]

Financing a car in someone elses name is illegal. Its called 'fronting', if a finance company finds out they will give you the option to return the vehicle or pay the balance due in full to avoid losing the car.
While many people do it, to avoid being caught ensure the vehicle is registered in the same name as that on the finance agreement - this is how they catch onto most 'fronted' deal.

Fronting is very different though,the method mentioned previous is 100% above board and there are actually many dealers that mess the finance forms up eager to get a sale.

 

[Chris_702]

Fronting is very different though,the method mentioned previous is 100% above board and there are actually many dealers that mess the finance forms up eager to get a sale.

It can't be above board - no finance company allows an agreement to be fronted.
Lets face it, every dealer in the country does it and any that says they dont is a liar, however, it's a risk you take - if the finance company happen to carry out a spot check and it seems the car is registered to someone else, they will demand the car back or the advance to be paid in full.

 

[KevM]

Yeah, technically it's an accommodation deal & not 100% legit, UNLESS it's immediate family, as this is, but insuring the vehicle must be done in a way that reflects the purchase. If you don't pay the finance, you don't have an insurable interest in the vehicle, so as stated, mum must insure with you as a named driver or your insurer will just laugh at you if you try to claim.

 

[da.murf]

Fca have changed laws recently.

A parent can not finance a car that will be for all intensive purposes used solely (on paper or not) by the child.

Yes lots of loopholes and ways to cover it up etc

Many dealers will ensure customer knows how to cover up etc


If you get mystery shopped by fca and you mention this... you are boned lol.

We turned away a sale recently because of it.

 

[Gavlar]

Sounds like a world of pain if insurance/finance company or police ever get involved

 

[da.murf]

Sounds like a world of pain if insurance/finance company or police ever get involved

Yup. Basically fraud in the eyes of insurance company and finance company lol

 

[Johnboy123]

Yup. Basically fraud in the eyes of insurance company and finance company lol

That's I'm asking,my mate knows a guy in Bavarian and he said something about fronting.Other dealers have always been fine.but as you mentioned things have changed since I last done it and I wanna be all above board.better to ask and be 100% than be caught out.

 

[da.murf]

Fronting =

Dad finances
Son 'owns' the car

Interpret 'owns' what ever way suits lol

People will get insurance in their name or themselves as a named driver and keep v5 in log book of the financee

All dealers are meant to refuse business from now one if you get a sniff of a fronted deal.

For example

Dad comes down to look at cars with son but has no interest and son wants test drive etc.

It is dealer discretion if they decide to play along and sell etc

 

[Boabybooster]

What's stopping you getting the finance in your name?

 

[Johnboy123]

What's stopping you getting the finance in your name?

Well I've a remortgage due and the bank is being picky.my current deal on the car has nearly run out and I don't wanna get caught out in this new tax scheme in April.

 

[Boabybooster]

Well I've a remortgage due and the bank is being picky.my current deal on the car has nearly run out and I don't wanna get caught out in this new tax scheme in April.

Just get a runaround till the mortgage is done, if the banks see you have no car payments, you will probably get a better deal through the affordability checks

 

[Johnboy123]

Just get a runaround till the mortgage is done, if the banks see you have no car payments, you will probably get a better deal through the affordability checks

Apparently I'm earning enough at the moment,unless the banks tightens it grip as I was made to believe.I don't wanna get caught out with that new tax scheme.i don't wanna pay for £350 a year on top.

 

[chris_b]

It can't be above board - no finance company allows an agreement to be fronted.
Lets face it, every dealer in the country does it and any that says they dont is a liar, however, it's a risk you take - if the finance company happen to carry out a spot check and it seems the car is registered to someone else, they will demand the car back or the advance to be paid in full.

It was many moons ago I know because I had to do it. In order to do so I had a million loop holes to go through but everyone, finance co, dealer, Insurance checked everything and were 100% happy and the circumstances were noted on the deal.

Fca have changed laws recently.

A parent can not finance a car that will be for all intensive purposes used solely (on paper or not) by the child.

Yes lots of loopholes and ways to cover it up etc

Many dealers will ensure customer knows how to cover up etc


If you get mystery shopped by fca and you mention this... you are boned lol.

We turned away a sale recently because of it.

Thats interesting, as stated above I had no choice but to do this donkeys years ago and I am totally certain it was at the time all perfectly fine.

So my daughter will be driving in two years and due to this change I cannot go down to Bavarian for example and get her a new Mini on drip ? (legitimately)

 

[saxo_man]

So my daughter will be driving in two years and due to this change I cannot go down to Bavarian for example and get her a new Mini on drip ? (legitimately)

That doesn't seem right, you'd imagine your money you can do as you wish for another person?

 

[chris_b]

That doesn't seem right, you'd imagine your money you can do as you wish for another person?

Hence my asking.
I, as mentioned had absolutely no choice but to do this years ago and it ended up myself and the finance company explaining to the dealership the correct and legal way to do it.
The dealer (big one) ended up quite embarrassed because it turns out they were not that well versed on how to do this and until my insistence they had been filling the forms out incorrectly and it transpired they had been doing so both wrongly and illegally for years prior ! i.e. listing a son / daughter for example as the owner and not the keeper

 

[Johnboy123]

Hence my asking.
I, as mentioned had absolutely no choice but to do this years ago and it ended up myself and the finance company explaining to the dealership the correct and legal way to do it.
The dealer (big one) ended up quite embarrassed because it turns out they were not that well versed on how to do this and until my insistence they had been filling the forms out incorrectly and it transpired they had been doing so both wrongly and illegally for years prior ! i.e. listing a son / daughter for example as the owner and not the keeper

So it is legit as long as it's all across the board,and the finance is made aware?