5 Ways to Buy a Vehicle With Your Significant Other

Call it what you will – a significant other, spouse, boyfriend or girlfriend – buying a vehicle with any partner can be achieved through joint loans, or the process of one person buying it and then having the other’s name added to the title. A joint loan essentially equates to both partners being responsible for the loan, allowing each to co-own the vehicle; adding a name to the title following purchase requires the partner’s inclusion in the loan, or possibly refinancing.

In this article, we’ll examine these tactics and others so you can make a more informed purchase if you’re shopping for a vehicle with your “better half.”

1. Joint Loans

This option can be helpful to individuals with limited income or lower credit scores, as it assists them with qualifying for a loan by combining credit history and income. In this scenario, both partners are legally obligated to repay the loan and co-own the vehicle; bear in mind that if the partnership comes to an end, resolving ownership can become complicated.

2. Adding a Name to the Title After Purchase

This enables one partner to purchase the vehicle first, potentially securing better loan terms or interest rate, while still including the other individual on the title at a later time. The flip side of this coin suggests that adding a name to the title after the loan is taken out may require a cosigner release or refinancing. Moreover, some warranties may be affected if ownership is changed after the initial purchase.

3. Consider the Bevy of Factors Before Making the Purchase

This can be divided into four major concerns: Financial agreement, needs/wants, relationship dynamics, and legal advice. It’s essential to determine how expenses such as insurance, maintenance, and registration will be handled, and it’s equally vital to discuss what features are necessary for the vehicle versus which are merely desired (this avoids future disagreements).

Because buying a car together can be a stress test for a relationship, open communication and agreement are crucial for a smooth process. Complex situations demand seeking legal advice to ensure all parties understand their rights and responsibilities.

4. Figure Out the Finances

In determining how much vehicle you can afford, aim to spend less than 20% of your monthly take-home income on total car expenses – including repairs, maintenance, insurance, fuel, and payments. If you take out an auto loan, which we touched on initially, plan to hand over 10% for a down payment on a used car and 20% for a new vehicle.

5. Collaborate on a Car Fund

Couples saving for a down payment on a vehicle should set up a shared account for that purpose – a general rule of thumb here is to segregate funds when saving for a big expense. After all, this isn’t the shoe or vacation fund, it’s the car fund. While it’s likely that both parties will be ponying up different amounts, it shouldn’t matter all that much in the end...if you plan on committing to each other long-term, you should consider your money shared.

If you and your significant other agree on needs and wants, you can begin looking for a trustworthy auto finance solution to begin living out those romantic excursions on two-lane mountain roads.