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168

As a frame challenge to your question, consider that a deposit in your bank is essentially you giving a loan to the bank. Now the bank has money which they can loan to your friend! Yes, you're only making 2% by loaning money to the bank, but this way, the fact that you're only earning 2% is essentially you allowing the bank to keep a portion of the interest ...


45

To secure the loan, would it be possible to take the car as a collateral? Yes it is possible. But to do this you have to create a lien, which is a legal document, and you would need a lawyer to do it. With the lien: A) yes you stop him selling the car B) Yes this will be registered C) Yes you can take the car back. Without the lien the answer to all of ...


23

Buy for your friend a cheap and reasonably reliable used car. You can get such car for less than you would spend on lawyers to write a contract for the loan in your inquiry (so you and your friend are already ahead financially - because otherwise this cost would have to be added to the loan your friend would have to finance, and you risk to lose). If he ...


21

Remember who you're asking: Personal Finance and Money. Many of us are older (meaning "parents"), and financially conservative (meaning "live below your means" and "don't spend a lot on a car until you have a healthy net worth".) What would your opinion on this be Were I your age, making your amount of money, I'd also want something shiny, fast and new. ...


8

If we sold the car and used the money to pay down the loan, would we be able to continue making payments on the $2000 balance until it is payed off? That depends on the loan you have. If the loan is secured by your car like most auto loans, it would have to be converted to a different loan, probably unsecured (resp. refinanced with it). That probably ...


7

Even though this is the personal finance site, I'm going to skip over all the reasons why this is a really bad idea financially**(other people & answers will cover that), and get right to the driving. Face it, if you are a typical 18 year old (that is, your parents didn't send you to a performance driving school before handing over their car keys), you ...


7

A) Their word and your lawyers. Also, see B B) File a lien on the title C) Outline these details in the contract D) You can try taking it back yourself through legal means but paying a reputable repo company might be better E) See C and request that they supply you a copy of their insurance policy upon every renewal. F) Mortgages have something called PMI (...


2

Some down sides to a low down payment: A higher DP which leads to a lower monthly payment gives you the flexibility to sometimes not aggressively pay down the loan. The high loan certainly impacts your credit score for "a while" (for some non-specific measure of "while"). In some jurisdictions, early payment fees/penalties might be written into the loan ...


2

This sounds like a scam. I'm going to assume you are in Canada and will be the one showing the car to prospective buyers. Irrevocably paying you is pretty easy. Cashiers check (one where they cannot stop payment) would be enough here. Wire transfer would also work. If you're extra paranoid, you could also have the buyer follow you to the bank after you ...


1

I'm only going to answer about the safe payment aspect, not the friend in Africa. While it is true that the most secure ways to receive payment is either cash or a cashier cheque that you see being cut by the bank, with little higher risk tolerance you might consider some easier ways. I would accept a pre-made cashiers cheque with some extra security ...


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