How can I transfer a car loan to my wife during a divorce in Michigan?
The cars (both Honda Civics) are our only assets, and we are planning to divorce. Both of the loans are in my name, but she has agreed to take over the loan for her car. How do I get it to be only in her name?
“Sorry to hear about the divorce; I hope it is an easy and amicable process.
The only way to make your future ex-wife fully responsible for the loan is if she refinances the vehicle in her name. This means that she needs to apply and get approved for a car loan on her own (or have a cosigner help).
If she can’t refinance the vehicle in her name, then lenders will hold you both financially responsible as long as your name is on the loan, regardless of what your divorce decree may say.
Otherwise, you can pay off the debt before the divorce so there’s no loan at all. It’s often easier to split an asset than a debt. If either of you can afford to play the loan off, review your loan paperwork to ensure you won’t be charged prepayment penalties.
You can also try selling the car, in which case you’ll still have to make up the difference for the loan.
While it adds another thing to your plate, you and your ex-wife will need to get separate insurance policies if you haven’t already. Divorce is stressful, and shopping for car insurance can feel like a burden, but the free Jerry app can make this easy. You can signup for Jerry in under 45 seconds, leaving the hardwork of comparison shopping and preparing signup paperwork to them.”
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