Please Scroll Down to See Forums Below Not sure if this is the right forum for this question but I have a friend that has a boat that he can’t afford and is trying to sell or he is also thinking about filing bankruptcy because of some debt problems. I would like the boat but I just financed a home and I don’t think that I could get financed right now. I was thinking about telling my friend that if he would leave the boat in his name, let me give him some down and pay his payments for him. I get to have the boat while paying the payments. And when I pay it off or can get it financed in my name then he can sign over the title. Is this a stupid idea or could I make it work with some kind of legal contract?
Taking over payments on boat?
- Thread starter Golddoor
- Start date
bran987
New member
he said because he doesn't think he can qualify, plus he didn't say it's a lease.Razorguns said:
there is sort of an unspoken rule about this in real estate. some people buy houses on a "contract for deed" from a seller to avoid precisely this problem, and to keep the existing loan in place for a variety of factors.
lenders have a "due on sale" clause written in mortgages, whereby they can call the loan due at any time if the property has been sold without them being notified.
sending the checks in yourself would seem to be an obvious indicator that the property has been sold, which would trigger the due on sale clause from the bank.
the unspoken rule though is, as long as the lender is receiving payments on time, they will never call the loan due. banks don't want to own real estate, they want performing loans. but definitely don't send the payments to your friend, send them directly to the lender. your "friend" will cash the checks and spend the money himself.
this is how it works in real estate. check the mortgage on the boat and see if they even have a due on sale clause, if not, buy it from your friend on a contract for deed.
the seller will still hold legal title, but you will then hold "equitable" title, which gives you the right to possess and use the boat and enjoy all the benefits as if you owned it. when you finish making all the payments, then he'll give you the legal title.
Razorguns
Well-known member
bran987 said:
Check the laws on that. I believe boats are referred as vehicles.
Meaning, what if on the last day -- he sells the boat to someone else, and transfers over the title. What recourse do you have? New owner, with new title -- has no obligation to even say hi to you.
Chances are these incidents will rarely if ever happen -- but when thousands are at stake -- you need to consider all scenarios and results. Be aware for your own sake.
