What are the risks of buying a car under someone else's name?
4 Answers
Here is an introduction to the risks of buying a car under someone else's name: 1. "Borrowing a name to buy a car" agreements are not protected by law: The behavior where the owner of a license plate quota privately agrees with a third party to allow the use of the license plate quota issued by the administrative department. This behavior not only violates the "Interim Provisions on the Regulation of the Number of Passenger Cars in Beijing" but also contravenes Article 103 of the "Regulations for the Implementation of the Road Traffic Safety Law of the People's Republic of China" and Article 7 of the "Contract Law of the People's Republic of China". 2. The quota user faces the risk of the vehicle being mortgaged or executed: Due to "borrowing a name to buy a car," the vehicle is registered under the name of the license plate owner, not the name of the person who actually purchased the vehicle. This creates a phenomenon of "separation of vehicle and household." For the quota user, there may be situations where the purchased vehicle is mortgaged by the registered owner, affecting the use of the vehicle.
I found it quite troublesome when I helped a friend purchase a car on their behalf. If the name on the registration isn't yours, the car legally belongs to the registered owner. In case the other party has debts or goes bankrupt, the court will include the car when seizing assets. Handling traffic violations or annual inspections requires the registered owner to visit the vehicle management office in person. Last time, my friend was on a business trip, and it delayed things for over half a month. If there's a car accident dispute, determining liability becomes extremely complicated, and traffic police have to repeatedly verify the actual owner. Additionally, buying or selling and transferring ownership requires the owner to be present to sign. If the relationship sours and the other party refuses to cooperate, it can be a nightmare. My advice is to register the car under your own name—it’s much simpler, even if it costs a bit more. It’s worth it.
Using someone else's name to buy a car comes with many hidden risks. The biggest risk is property-related—if the registered owner goes through a divorce and assets are divided, the car could easily be awarded to their spouse by the court. Financing a car is even more troublesome, as the bank loan records will be under someone else's name, potentially affecting your own credit score. Once, a friend secretly used a car registered under his name as collateral for a small loan company, and it took us half a year to get it back. Insurance claims are also inconvenient—after an accident, the insurance payout goes directly to the registered owner's account. I've fallen into all these pitfalls myself, and now, no matter how busy I am, I always handle the car purchase procedures myself.
Buying a car under someone else's name can lead to three key issues: First, there's confusion over vehicle management rights—if the registered owner refuses to cooperate when handling traffic violation points, you're left in a passive position. Second, there's risk during policy changes, such as the extreme difficulty in transferring license quotas in cities with purchase restrictions. Lastly, it affects your own rights—writing someone else's name on the purchase invoice means forfeiting eligibility for buyer incentives. I once helped a relative buy a car, only to face the hassle of cross-province annual inspections after they moved away. These practical troubles far exceed expectations, especially when dealing with financial services like insurance and loans.
