How do you transfer a car loan from one person to another?

How do you transfer a car loan to someone else? I was laid off from my job two months ago. I’ve been actively searching for a new job ever since. To help take care of my car loan, my grandpa offered to take over my loan until I could make regular payments myself again.

Answer
That’s really kind of your grandpa to help take care of your loan! Since your grandpa is offering to take ownership of your loan, you will need to sell your vehicle and transfer the car title to him. By law, the person with the title is responsible for the car loan. To transfer a car loan from one person to another, you will need to:
  • Step 1: Check your loan contract. Before you can transfer your car loan, you need to check if your loan agreement allows you to transfer your loan to another person. If you can’t find this information, contact your lender to verify this option.
  • Step 2: Determine the value of your vehicle. To help get an idea of your car’s market value, try using free pricing resources like Kelley Bluebook or Edmunds.
  • Step 3: Your grandpa will need to apply for a new loan. The lender will check if he qualifies for a loan. Check with the lender what documents they require the buyer to provide.
  • Step 4: Transfer the car title. You will need to go to the DMV to fill out the proper paperwork to transfer the title to your grandpa.
Alternatively, if your lender doesn’t allow a loan transfer, you can try to refinance your existing loan using their name. Be mindful that your lender may also charge processing or transfer fees during this process.
As your financial situation has changed since you took out your auto loan, consider refinancing your loan yourself. On average, car owners pay $85 less every month by refinancing their auto loans. See if refinancing will save you money with the Jerry app.
Phoebe Mah
Answered on Dec 08, 2021
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