How Do I Take Over Payments On Car Loan Contract?

Purchasing a new, shiny car brings a lot of excitement, fulfillment, and joy. Unfortunately, life is unpredictable. In December 2019 at the onset of the Corona pandemic in China, few people would have predicted the deaths and economic turmoil it has triggered globally. Almost all businesses are struggling with the effects of Covid-19. Despite the government efforts and business bailout funds, more businesses continue to close shop, rendering employees jobless.

Although losing a job is traumatic to many, the situation is more dire and depressing to people with auto loans. If you can no longer make payments, you should consider asking a friend or a relative to take over payments on car.

Looking for someone to take over payments on car is a quick way to help you avoid defaulting on your auto loan. You only need to find someone willing to take over the loan to start the process of loan payments takeover. On the other hand, taking over a loan repayment is a cheaper way to get a relatively new car, making it ideal for those looking to save money.

If you are looking for a car, this article will teach you how to take over on car loan payments contract and in return help someone in financial difficulty.

How Do I Take Over A Car Loan Payments Contract?

Seeing your friend struggle with the stress and pressure that comes with the inability to make prompt auto loan repayments can be heartbreaking. However, you can come to the rescue of your friend by opting to take over payments on car.

Although the urge to see your friend smile again may be too much, the process of a car loan transfer can be cumbersome. The process may require you to showcase your creditworthiness and transfer insurance and registration to your name. That said, the steps you should take to take over payments on car include:

1. Check the current loan details

Your first step in taking over your friend’s loan payment should be to review the documents and details of the loan. Check whether it is possible to transfer a loan to another person. If you cannot find the details, contact the lender to ask about the loan transfer.

You should also familiarize yourself with the terms and conditions of the loan to ensure that you have clear information about what you are getting into as you help your friend. Most financial institutions allow third-party loan transfers under specific terms and conditions.

2. Consider your credibility

Before allowing a loan transfer, the financial institution will check your creditworthiness. You should ensure that you meet the minimum credit score requirement. The financial institution will treat your application as a new loan.

You must meet all loan application requirements, including credit score, stable income, residence proof, and other all necessary documents. The financial institution will only allow the transfer after they are happy with your application.

3. Get approval and sign paperwork

Once the financing institution is happy with your application, it will trigger the transfer, allowing you to take responsibility for the loan. However, you will need to fill in the documents and provide all the paperwork necessary for transfer.

The financial institution will offer you a loan that they will use to clear your friend’s balance. Remember to review the fees, interest rates, and monthly amount before you can sign the paperwork. Make sure the loan is not excessively expensive.

4. Transfer registration certificate

The transfer of the registration certificate should happen along with the loan. You should visit the regional transport office to initiate the transfer process. Your friend will have to pay transfer fees before the RTO office can change the certificate to your name.

5. Transfer motor insurance policy

While there might be a temptation to drive the car for a few days with your friend’s insurance policy, you should keep in mind that you may experience compensation problems if an accident occurs. Insurance companies will always look for a reason why they should not compensate you after an accident and transfer of registration certificate is enough reason.

Some policy providers make it possible to transfer motor insurance policy to a third party for an easy and quick sale. You can contact the insurance company to request an insurance policy transfer and submit all related documents. You may also choose to shop for a motor insurance cover from other providers to get the best deal.

Learn More: How To Get A Car Loan With No Job And Bad Credit?

What To Look Out For Before You Take Over Payments On Car?

While the chance to get a car on a cheap without down payment can be tempting, it is always good to remember that you are buying a used car. Even when you are taking over the payments from your friends, you should practice due diligence to ensure that you are investing in a good car.

It does not make sense to buy a car that requires spares or a lot of maintenance at a market price. If you find issues, you should ask your friend to fix them before you can take over payments on car; otherwise, you should walk away from the deal. Some of the things you should look for before taking over the payments on a vehicle include:

1. Engine condition

Modern car manufacturers have invested in the reliability and performance of cars. However, it is beneficial to ensure that the vehicle you want to take over payments has a good maintenance record. A well-maintained engine enhances the performance of your car. It also lowers the risk of engine failure or expensive maintenance.

2. Leaks

Car leaks are quick to find. A leak is a sign that the car has not had good maintenance. Check underneath for signs of a fluid leak. You can tell if the car has oil leaks by looking for oil drops on the tarmac or sludge under the car. Sludge occurs when the dirt sticks on the oily parts of the engine.

You should also open the bonnet and look for black or brown spots, which can be a sign of other leaks. If you find leaks, you should ask the seller to fix them before you can take over the payments.

3. Mileage

Buying a car based on a lower price alone does not necessarily mean you are getting value. It is always important to look at the mileage. A car with high mileage shows excessive use and hence, more tear and wear on the mechanical components.

You can determine how the vehicle has been used by dividing the number on the odometer by the car’s age to find the average miles per year. Newer vehicles with higher mileage show intensive use, which may not be ideal for you in the long run as you may struggle to sell the vehicle in the future.

4. Air conditioning

Driving a car without air conditioning in the scorching sun is uncomfortable and unpleasant. Installing an air conditioner can be costly and hence the need to ensure the system is working correctly before taking over the payments. The car you purchase should be as comfortable to ride as possible.

5. Exteriors

How does the car look on the outside? The impression it leaves as you drive is as imperative as the performance of the engine. Many scratches, dents, and folds can be unsightly to look at and will need fixing before you can take over car payments.

A few dents and scratches are okay in a used car, but there is nothing wrong with asking the friend to fix them before car transfer. Look out for paint chips and rusty spots while inspecting the vehicle.

6. Lights

Ensure the headlights, emergency lights, and signal lights are working effectively. Ask the seller to fix all light issues, including interior LED bulbs before you can choose to take over the payments.

7. Interiors

The interiors will be a good indicator of how the owner has been using the car. The seats should be comfortable for a relaxed ride. The interiors should also be attractive. However, you should expect the feel of a new vehicle when buying a used car.

An older car will have more tear and wear than a newer car. If you find tears or rips in the upholstery, sagging roof lining, or drilled holes in the dashboard, you can haggle the price to pay for repairs.

8. Electronics

Modern cars come with exciting, helpful technology. The technology keeps you entertained as you drive and can also help you navigate unfamiliar streets. Spend time trying out different electronics, including radio, central locking, GPRS, infotainment system, USB ports, and parking cameras are working correctly. You should also ensure that the safety features like brakes, pedestrian crossing alert, and lane assist are working as intended.

9. Test drive

Exteriors, interiors, and electronics could be okay, but the car could still have issues under the hood. You should not take over payments on a car that you have not taken on a test drive. You can test the feel and comfort of the ride as you drive on different terrains. You should try out the vehicle at different speeds while listening to the engine noises and irritating rattles.


If you are looking to get a good car cheaply, you should consider taking over the vehicle’s payments. You can take over payments on car where the owner can no longer make payments. It gives you a chance to help a person in a difficult financial situation as you save on a car.

CarsPlan Admin

Cars Plan is automotive information providing a blog. Here you got the best information about the automotive lease, warranty, accident law, insurance, donation, finance, reviews.

Related Articles