ACT De Facto Relationship Breakdown - Car Loan & Ownership Rights?

[Lepohi]

Hey everyone
Whilst I was with my de facto girlfriend my current car was in bad shape and needed upgrading. Due to a default on my credit file the only car loan finance (after a credit check) I could get was at a really high rate (22%).

My girlfriend at the time agreed to finance the vehicle in her name and I would put a substantial deposit ($21k deposit on a the $60k loan, leaving $39k to finance).

We have email correspondence with all this agreed and the car is registered and car insurance in my name. I asked at the time what would happen if the relationship ever ended as I didn't want to get in a bad situation and we agreed I would just continue to pay the loan. The relationship has since broken down, as agreed I have continued to make all payments, never missing one. Have also kept up with the cars services, etc.

My ex is now saying she will come and 'take' the car, as she owns it because the finance is in her name. But I have paid $30k to date and have done the right thing in keeping ahead of the payments as agreed, the car is also registered to me.

Please let me know if she can actually just rock up and take it? And also who owns the car?

Thank you in advance.

 

[John R]

Hi @Lepohi
To clarify my understanding of your question, are the following points correct?

1. The car is registered in your name;
2. The car insurance is in your name;
3. The car loan/financing is in your ex-partner's name; and
4. Your ex-partner borrowed $39K under the car loan/financing and you've paid off $30K of this amount to date.

Question for you:

1. How and what did you specifically agree what would happen in the event of relationship breakdown (verbal, email, etc.)?

 

[Lepohi]

Thank you for a reply

He total loan amount is $67k with interest included in that (payout amount). I have paid $30k today with $37k owing.

Yes the registration is in my name as is the insurance.

The agreement was always that her assisting me was never related to the relationship and had no bearing on it as it was a favour. I have leant her money when needed (never repayed...) and I even said one night that I was having second thoughts about he finance going in her name as it made me vulnerable and we agreed then that regardless of what happened with us, as long as the payments were made it was good.

 

[John R]

Hi @Lepohi,

1. Do you know if your ex-partner took out a personal loan or a car loan? My understanding is that most car loans would require the car to be registered in your ex-partner's name.
2. I understand that you believe you had an agreement with your ex-partner - but how was that agreement "agreed" - e.g. only verbally, in writing, email, etc.?

 

[Lepohi]

It was a car loan through BMW finance. I'm 100% sure it's soley registered to me.

The agreement was made over a mix of verbal but there is supporting email and SMS correspondence.
I just don't want to lose the $30k I have put into it so far, I rely on my car for work and this is really worrying me as she seems to believe she can just 'take' it.

 

[John R]

Hi @Lepohi
I'm interested to read other members thoughts in relation to your question. Based on your posts, my understanding is that:

1. it is likely that BMW Finance has a security interest over the car while money is still owed under the car loan. Security interests are commonly registered in the Personal Property Securities Register (PPSR or PPS Register). The PPSR has a "Quick motor vehicle search" service (cost is $4) that you can search using the car's Vehicle Identification Number (VIN) to confirm this.
2. On the assumption that the car has a registered security interest, it is important to consider that even if you continue to pay off the loan, you will not be able to sell or trade-in the vehicle without BMW Finance removing the registered security interest. This may require your ex-partner to contact BMW Finance to complete this process (as part of discharging the loan). There is also the potential risk that your ex-partner may change the terms of the car loan (or even cancel/rescind the car loan) with BMW Finance without notifying you.
3. The specifics of any agreement that you had with your ex-partner is unclear (including whether your relationship was considered a de facto relationship and the separation of any other assets from your relationship). That said, assuming you've made an agreement in relation to the separation of your assets, because the registered owner of the car, it is reasonable to assume that your ex-partner can't "just take" the car without the serious risk of you reporting the car to the ACT Police as stolen.

Hope this helps.

 

[Lepohi]

Thank you John, that is really helpful.

I make the payments to BMW directly from my bank account to them and fully intend to continue to do so (keeping my end of the deal) until the loan is paid out. It's reasuring that I won't just lose the car over night (legally) and lose all monies invested into it so far, Im not looking to sel the vehicle, just continue to pay it off till its unencumbered.