How can we protect our interest in a truck if the loan is in someone else’s name but we have been making the payments?

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How can we protect our interest in a truck if the loan is in someone else’s name but we have been making the payments?

My husband got a truck with the help of a friend. The loan is in the friend’s name but my husband paid the downpayment and monthly payments are directly withdrawn from his account. He also pays the monthly insurance. He was supposed to try and get it put in his name in 6 months; it’s been 11 months now. The friend wants the truck back with no money exchanged. What can we do legally?

Asked on March 27, 2011 under Bankruptcy Law, Ohio

Answers:

MD, Member, California Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

Unfortunately, this is not legally recommended because unless the insurance in his name alone or as a primary driver with the legal owner's name on the insurance as well, the insurance may be cancelled. Meaning, if god forbid your husband should get into an accident and he is the driver and the insurance company finds out and he is not listed on the insurance, not only would there be a cancellation of insurance and no coverage but also you and your husband may face a lawsuit from the other driver and the true owner of the vehicle. While your husband's friend may have done something nice for your husband, your husband is now placed in a situation wherein he gifted this friend the truck by paying for it. If your husband doesn't have a loan agreement with the friend regarding this truck, he may be out of luck. If he does have a loan agreement and the breach of 6 months is overlooked and the fact it included illegal insurance activity doesn't make the contract voidable by the court, your husband may be able to sue for some sort of reimbursement of the monies he paid in. Make sure you put together as much evidence as possible (from cancelled checks to loan agreements, to notes and text messages and emails). Good luck and remember to list payments chronologically.


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