Can You Transfer a Car Loan to Someone Else?
Yes. Car loans are one of the few loans you can actually choose to transfer to another person. In order for you to do this, you’d first have to find someone who is willing to take on the loan in your stead. The agency that approved your car loan will then have to check that person’s eligibility. If approved, you can sign the necessary paperwork to make it official.
But, not all lending firms allow you to transfer your car loan. If you’re desperate in need of transferring your car loan for whatever reason, keep the following things in mind:
- Read the fine print – check the contract that you signed to know exactly where you stand on your bank loan. Some car companies will not allow loan transfers, but others will. This is indicated in the fine print, and you’ll be able to know what’s what if you check.
- Perform a background check – it pays to check if the person who’s willing to take on your loan for you is actually able to. This will save you both a lot of time and make transactions more efficient.
- Get your papers in order – if all goes well, you’ll need to sign and handle a lot of paperwork. If you want to get things done faster, ready your paperwork as soon as you find a willing individual who’ll take on the unsecured loan for you. The same ought to be said to the second party, since they’ll likewise have to update paperwork as well.
When you have taken out a guaranteed loan, it can be a struggle to keep up with the payments. If your loan repayments are just around the corner and you need some way to breathe a little financially, one viable solution you might want to consider is using a credit card to pay it off. Below are some things that you need to know before you consider this approach.
How it works
Credit cards can be good tools when managing debt provided that you have the discipline to only use the card for that specific purpose alone. You’ll need a card that offers good money transfer deals. This will then let you transfer the full amount on the card to your current account, which you can use to pay off your quick loan in full or gradually. For this purpose, you need to find a card that does not charge any interest on money transfer or one that charges low interest for a long term. To be offered one, however, you will usually need a good credit score.
Things to look out for
Before you push through with the debt transfer, there are certain things you must be wary of such as:
Fees from the lender. There are lenders that will charge a fee if you settle the home loan early. If there, find out what the specific charges are. It is quite common for most banks to charge interest worth two months for sums that are repaid early. Card revert rate. While you may get the introductory period where the card charges low to zero interest rate; after the period expires, it will go back to charging the standard rate. This is why you need to work on paying off the balance as soon as you can before the standard rate kicks in.
Money transfer fees. Transferring money to the new credit card will usually incur a charge of around 3% of the transferred amount. If you can, try to find cards that will charge lower or those that do not charge a fee to lessen the costs.
What to do when the interest-free period runs out
If the interest-free period runs out and you are still unable to pay the credit card debt in full, you can consider applying for another credit card with a balance transfer rate of 0%. This will help trigger a new period that is interest-free. This should give you more time to get the debt repaid.
When using a credit card to pay off your loan, it is important not to use it for other spending. it can be very tempting but additional spending is only likely to make it harder for you to pay it off.