UPDATE-(#54)Can you help me convince DH that this is a bad idea?? WWYD?

[jerseygirl07067]

Warning - This is a bit long!!

First a quick bit of history before I post the actual dilemma...We are frugal and really watch our money - out of necessity, as we are now raising a family of 5 on 1.25 incomes. I work about 10 hours a week, and DH and I prefer it that way so we don't have to put the kids in daycare, etc. We clip coupons, drive old cars, budget every little thing down to the dollar and really watch our spending. We have sacrificed trips, new clothes, dinners out, to make this work for us. So far so good.

DH's sister/my SIL spends very wastefully, is in major debt, has credit collectors calling the house constantly on the weekends we are there, lives in a huge house with his parents, has a huge car payment, which she had other loans rolled into. They buy things constantly. It's crazy how wasteful she is, as well as DH's parents. They have 3 tv's, 3 or 4 refrigerators, a bunch of pets, and they make purchases they clearly can't afford.

Now the dilemma...SIL is proposing we trade cars. We give her our car which is paid off (a Honda Accord with very high mileage) for her car, a two year old Dodge Charger with 40,000 miles that she is waaay upside down on. (She owes over $20,000 on this car that is only worth $13,000) The agreement would be for us to pay a small portion of the car payment, and for her to pay a larger portion of the existing car payment, until it's paid off. The benefit to us is that we replace our older car with one with much lower mileage. The benefit to her is that she doesn't lose her car because she can't afford it. I will also add here that SIL and her husband are both auto mechanics.

I think this is a baaaad idea for many reasons...1. the car will still be in their name, and what if she gets laid off or can't make payments? 2. We will be paying for a car we really don't want, and after 4 years it's paid off and now we have a 6 year old Dodge Charger that likely has plummeted in value, not to mention it doesn't have the greatest reliability. 3. The insurance issue....the proposal is to keep the cars still in our own names...and still make the existing insurance payments...I can't trust them to do that..what if they miss a payment? Also, isn't that insurance fraud if we're not driving the car we're saying we're insured on? 4. The whole thing seems like the arrangement that has the potential to cause a huge family rift should it not work out 5. We watch every single penny, and they clearly spend every single penny....so while this is going to help her out so her car doesn't get repossessed, we will be paying for a car we normally wouldn't be purchasing, or desiring, in the name of helping out someone who spends like crazy, while we watch every little penny. 6. We really can't afford this in the long run either, because our top priority is replacing our car with a minivan or an SUV to accomodate our kids/friends/family, etc. So we would likely now have to take on two car payments...which we can't really afford.

The problem is that DH thinks it's a bad idea too, but feels really guilty about not helping his sister. He is going to talk to his brother today, to get his opinion. I don't want to be selfish, but I feel like we have sacrificed so much, and watch every penny, so why should we feel bad for choosing not to do this? SIL is the one who has gotten herself into this situation.

It think it would benefit his sister more to meet with someone who can help her do a budget and learn how to spend more wisely, rather than this proposal. But I am worried that when DH talks to his brother today, he might be easily influenced by him if he supports the proposal. I'm concerned about this, though this is a 50/50 decision between the two of us.

WWYD?

[Ceepa]

My gut is screaming "don't do it!" and I think yours is too.

[SnuggleBuggles]

Irresponsible family members and money issues should not mix. I would not do it at all. Sorry, but she got herself into this mess and she is an adult- she needs to solve her problem in another way.

You have a Honda. Yeah, it has more miles...but it's a Honda. Take care of it and it will go for a long time. :)

[arivecchi]

The liability issues alone give me a headache. I would not do it.

[mom_hanna]

This is hard, because you are dealing with family, but I would NOT do this, under any circumstance, for all the reasons you stated.

[MontrealMum]

No way. There are way too many things that could go wrong with that scenario - all of which would be bad for you and your DH, and not necessarily for SIL. You have WAY more to lose in this situation than she does.

[jerseygirl07067]

MontrealMum, that's exactly what I have told DH every time we've had this conversation. :)

[niccig]

I say NO WAY.

I would use the minivan as an excuse. Tell her you can't do this as you need to keep your car and NO PAYMENT.

I get that your DH wants to help her out, but there has to be something that he can do to help that will not impact on your financially.

[Corie]

No way would I agree to this!! This situation could be a huge headache!

[elliput]

I am going to throw my "don't do it" in with the others. Even from here it stinks of a rotten deal for you.

[Laurel]

No! It is unreasonable of her to even ask this of you! I'd rather give someone a cash gift than make a deal like this.

[Indianamom2]

I think I would talk with your DH and tell him that although he is very kind and generous to want to help his sister, he is not helping her at all...he is simply enabling more harmful behavior, which in this particular case, also has great potential to harm your financial status and your relationship with your family.

Enabling and helping are two very different things, yet sometimes the nicest people among us do the most damage because they just want to make things better for those who continually make poor choices.

Good luck.

Christina

[daniele_ut]

No! It is unreasonable of her to even ask this of you! I'd rather give someone a cash gift than make a deal like this.

:yeahthat:

[mom2one]

No, no and no.

Family and money don't mix well together. Expect to be stuck with her car and YOU paying it off. If you are fine with that, then go for it!

[sarahsthreads]

I wouldn't even consider it. It will probably cause some hard feelings, but in the long run it would cause harder feelings if the deal went bad!

Sarah

[happymomma]

Irresponsible family members and money issues should not mix. I would not do it at all. Sorry, but she got herself into this mess and she is an adult- she needs to solve her problem in another way.

You have a Honda. Yeah, it has more miles...but it's a Honda. Take care of it and it will go for a long time. :)

:yeahthat:

[Moneypenny]

Just agreeing with everyone else that this is a big no for me.

If you want to sell each other your cars and switch the titles and make it all official, fine, but quasi-selling cars is a bad idea in many ways the PPs have already outlined.

[missym]

I'll add my voice to the chorus: :shake: and :thumbsdown: and just for good measure, :6: (to your SIL).

You know this is a bad idea. You and your DH may feel sorry for your SIL, but your first responsibility is to your own family's financial security. It sounds like you could put that in real jeapordy with this scheme. What an awful position to be put in... I'm sorry.

[rachelh]

I couldn't read your whole post or any of the answers because I am pressed for time but I didn't have to!! The moment i got to the line where you state she will be paying for part of the payment I felt compelled to answer.

DON'T DO IT!! NO MATTER HOW BAD YOU FEEL!! What would happen if she doesn't make her part of the payments and you would be stuck with the responsibility? Can you afford it? Even if you can do you want to be forced into a situation to pay it?

I am speaking from experience - we have "helped" out a family member once about four years ago which put us unexpectedly out of about $8,000. And if we didn't learn the first time we helped the same family member out again last year which will put us out $12,000 when all is said and done.

Unless you WANT the car and can afford the full payments, do not do it!

[npace19147]

Terrible from a family perspective and a financial perspective. Don't make it a debate w/DH, make it a nondiscussion. "We are not doing this. End of discussion."

[newg]

I'll just mention something about the charger too......not the easiest car for getting babies in and out!
DH has a charger and because of the slanted back seat door frame....it is back bending work to get dd in and out of the car.....infant seat and convertible seat.....I'm 5'5'' and dh is 6'5'' and it's tough for both of us.....!!
I can't imagine doing that with three little ones.....
Just some extra info to use when telling SIL a charger won't work for your family...
Plus the car seems to have something wrong with it all the time....

[DebbieJ]

Way way way bad idea. This is as bad as co-signing. Don't do it.

[MMEand1]

I agree with everyone here. If you want to help your SIL out, spend the money to put her through Dave Ramsey's Financial Peace University. This way, she can learn how to get out of debt herself and budget properly.

In situations like this my DH also says "Give a man a fish and you feed him for a day. Teach a man to fish and you feed him for a lifetime".

Good luck as you may not be very popular in the family realms.

[MamaMolly]

I think I would talk with your DH and tell him that although he is very kind and generous to want to help his sister, he is not helping her at all...he is simply enabling more harmful behavior, which in this particular case, also has great potential to harm your financial status and your relationship with your family.

Enabling and helping are two very different things, yet sometimes the nicest people among us do the most damage because they just want to make things better for those who continually make poor choices.

Good luck.

Christina

ITA with Christina. You absolutely, positively cannot agree to do this. You'd be better off giving her your car and buying another car (heck, you can even a $13K charger for $13K ;) ) but DO NOT take on her debt.

You'd never want to believe that a family member could leave you holding the bag in a case like this, but what if it happened through no fault of her own? What if she got hurt and couldn't work, what then? You don't want to be the shmuck that sues her disabled SIL, right?

BTW, I think she's put you in a terrible spot by even asking. She needs credit counseling at the very least, and probably some serious therapy, but not a free car.

[caleymama]

Just another "no" vote. For a multitude of reasons, which have all been stated by PPs. I'm sorry you have to deal with this, but pat yourself on the back for doing a good job our YOUR finances!

[Sillygirl]

Of course it's an awful idea. Just repeating what's been said here, saying "no" to this particular plan doesn't mean you can't help her in other ways that don't put your future financial health in jeopardy. Heck, just write her a check if you want, at least you won't have the stress of waiting for it all to blow up in your face.

[SpaceGal]

Don't do it...money and family don't mix especially in situations like this. I wouldn't trade cars...not for nothing they got themselves into that mess they have to get themselves out. I mean I'm all for helping family but sometimes they have to learn the hard way. My DH has a sister that was like that and she needed a lot of help financially. He helped her did it teach her anything nope she just kept taking and taking and taking. Maybe you can simply say you want to get a hybrid car eventually or something along those lines and right now you can't really afford to spend anymore money regardless of trading cars.

Good luck and I hope it doesn't turn out too messy.

[TwinFoxes]

Unless you've been dying to meet Judge Judy in person there's no way you should agree to this.

[jellibeans]

I can completely understand where you DH is coming from in wanting to help his sister out. You never want to see your loved ones in a bind or struggling. But by helping her out, you could be putting your family in monetry strain. What happens when they don't pay the payments and the car gets reposessed...you are going to have lost a lot of money AND you will be back to driving your high mileaged car. Plus that will add a lot of strain to your relationship with your family. Also, I don't think that it is right of your SIL to put you in this position, making you choose to help or not. Good luck trying to convince your hubby.

[wellyes]

Not only is it a bad deal -- you obviously feel contempt for this SIL and this will just bring it to the surface every time you write a check for the car. Bad deal AND bad for your marriage.

[ha98ed14]

I would run screaming for the hiils!

Issue 1: Financial Responsibility: Do not under any circumstances intertwine your finances with someone who is so visibly irresponsible. Her bahavior makes it obvious that she either has no impluse control, must keep up with the Jones or thinks she deserves the best. Whatever her thinking, she has basically screwed herself. What makes you think she won't do it to you too?

If she needs help, offer to give her money. Make it a gift and don't expect to get it back. But do not under any circumstances get YOUR finances mixed in with someone who has screwed up theirs.

Issue 2: Liability: And yes, that little arrangement is insurance fraud, unless you call the companies and tell them. But even more so, did you know that if SIL has an accident in a car where your name is on the title, the victim can sue you as the owner and they have grounds. You could lose your house, the kids' college money, any assets you may have. Don't risk that for your SIL. Your responsibility is to your kids first.

[brittone2]

As someone who has a sibling who has created major financial drama in his life for years, run far from this. Honestly.

I know what it is like to want to help, but sometimes you just have to protect yourself and say no.

[specialp]

No and you've listed plenty of reasons. Also, depending on your policy, such a material misinformation could give ins. co. grounds to deny you coverage in the event of a claim.

There are plenty of reasons for your DH to give for not doing this without brining up your SIL's financial irresponsibility or insulting her. Personally, I wouldn't ever do this even if the SIL was the most responsible person in the world. Don't obligate yourself orally do something your not obligated to do by written contract (in this case, the ins. policy & car note).

Final thought: DH would feel far worse if making this decision could in any way imperil his own family's security. And it does.

[maestramommy]

This falls under the category of "no.way.ever." taking on someone else's debt, no matter whose, would make my stomach hurt.

[doberbrat]

if nothing else, I think its insurance fraud to trade cars like that.

family & $$ never mix.

if you want to GIVE her the $$ then do so free and clear and know you'll never see a dime of it. but understand that the more you give, the more she'll probably want.

[AnnieW625]

tell her that you don't have the extra money to help out anyone.

[randomkid]

Hey Marcy:

Looks pretty unanimous and I agree. There's no way I'd go for that deal. You know with her financial history that she will end up not paying her part. Also, I'd never trade a Honda for a Dodge - no matter what the difference in age and mileage. I think a good arguement was provided by a PP - hard to get the baby in/out of the Charger and it always needs work. Not only are you inheriting a car payment, but repairs as well. Don't Do It!!!!!

[miki]

No way. Everything that could go wrong would be terrible for you.

[jerseygirl07067]

Thanks so much everyone. I really appreciate your input. I also appreciate the poster who mentioned that the car has needed lots of repairs. I discussed this with DH because one of the problems I have is owning a car that's not reliable. For 13K there are better cars to spend the money on.

[HannaAddict]

There are NO good reasons to do this. You might even be in violation of your insurance policy if you do it, if you aren't really the primary driver, etc. My prediction is that you end up with NO car when her Dodge is repossessed and then you have to try and get your car back. Or she totals your car and wants her car back. And bad feelings all around. If you can afford to help her get a used car she can afford, I would do that if you really financially can and feel like it is your problem, or just say no and don't let her make you feel guilty. It is not your fault. Even if she is upside down on it, if she makes the payments and continues to drive it, she has a car. She should drive it for years and not worry about what she could get for it. Sorry you are put in this bind, I know it is hard to say no, but I wouldn't do it. No way.

[ThreeofUs]

ITA - just throwing out that there are HUGE liability issues here - and it will be your family's well-being and savings that will be compromised. My reasons for a "no way" on this center around the risk you assume.

-Your SIL offering to get you into trouble for fraud (and insurance companies take a very aggressive stance on this type of behavior).
-You have no surety they will make any of the payments and you will never be able to legally force them to do so (that sound is your credit rating heading south if they don't).
-If any of them get into an accident in your car, you will be paying for it, one way or another. And if any of the parties to the accident (the other person and/or the insurance companies) get wind of your "arrangement", you'd be in even more legal trouble.

All this is in addition to (or re-emphasizing) what pps have said. But practically speaking, why agree to have a car that you don't want? I mean, you should get something positive out of an arrangement like this.

[buddyleebaby]

SIL has a car that she can't afford to keep.
So she wants you to pay her to use said car.
Commit insurance fraud.
And also give her your car for free.

Right.

[MontrealMum]

I've been thinking about this a bit more over dinner, and I don't think you need to give her any sort of explaination AT ALL as to why you don't want to do this.

PP have suggested several reasons - and I think that's nice, because they're nice people at heart :) - but what SIL is asking you isn't nice. It's an amazingly presumptious thing. I would be offended by it if I were in your position. If you don't want to do it, just say no. Plain and simple. You don't need to tell her why or why not, or to justify saying no. It's your money, your car, your choice. People like this are takers - if you do give any sort of reason, you'll just be giving her some words to twist around to her liking so she can convince you to do it anyway. The only complete and final shutdown for someone like this is a decisive no.

If you and your DH and other BIL want to do something I think the best thing would be a gift of money. If you can afford it. Personally I wouldn't do that as it seems that she hasn't shown she won't fritter that away either, but I think that's the only help you can really offer that isn't going to cost you big time in terms of your own credit, future plans, and financially.

[KBecks]

No way would I trade cars. That's is nuts. You should say no. If you want a newer car, you can go out and buy one outright.

SIL needs to figure out her finances, and you can offer advice or recommend a financial planner. I would not let her come after your money or other assets. You can give a gift or loan if you want, but be careful. Perhaps you can just offer encouragement and support and let her work this out on her own.

[KBecks]

I've been thinking about this a bit more over dinner, and I don't think you need to give her any sort of explaination AT ALL as to why you don't want to do this.

PP have suggested several reasons - and I think that's nice, because they're nice people at heart :) - but what SIL is asking you isn't nice. It's an amazingly presumptious thing. I would be offended by it if I were in your position. If you don't want to do it, just say no. Plain and simple. You don't need to tell her why or why not, or to justify saying no. It's your money, your car, your choice. People like this are takers - if you do give any sort of reason, you'll just be giving her some words to twist around to her liking so she can convince you to do it anyway. The only complete and final shutdown for someone like this is a decisive no.

If you and your DH and other BIL want to do something I think the best thing would be a gift of money. If you can afford it. Personally I wouldn't do that as it seems that she hasn't shown she won't fritter that away either, but I think that's the only help you can really offer that isn't going to cost you big time in terms of your own credit, future plans, and financially.


:yeahthat: It is very bold to go tell a family member you want their car. This is a bad deal and you do not want to get suckered, so don't.

[Melbel]

As the "responsible" one in my family, I am often approached by family members, especially my mom and sister, to bail them out due to their own fiscal irresponsibility. While we want to help in general, I agree that by doing so, we are actually enabling their irresponsible conduct. Ultimately, our primary responsibility is to our own family and children. If we do have extra to loan, we actually consider it more of a gift and any repayment would be a windfall.

I totally agree that your SIL/BIL are being very presumptuous and rude to even propose the deal. It is so WRONG and UNFAIR on so many levels, which has been articulated by PPs.

As far as liability, IIRC, you are in FL. If so, PPs were correct in stating that you could be liable as the owner of the Honda if your SIL were driving the vehicle because cars are considered "dangerous instrumentalities" under FL law. Additionally, it is unlikely that your insurance would pay on the claim if someone else were driving your insured vehicle as their primary vehicle. As such, your personal assets and security would be at serious risk.

While it is unfortunate that your SIL/BIL are having financial troubles, they need to figure out a solution that does not jeopardize your hard earned financial security. Just say no.

[Laurel]

SIL has a car that she can't afford to keep.
So she wants you to pay her to use said car.
Commit insurance fraud.
And also give her your car for free.

Right.

Well said. Would this convince DH this is a bad idea?

[Happy 2B mommy]

I wouldn't for 2 reasons:
I would never exchange a Honda for a Dodge!
Her money problems are hers, not yours.

[gatorsmom]

You know, this is a pretty clever little scheme. Your ILs had to have been giving this some thought. My guess is that they, like a pp, are already having problems with the Dodge. They are probably tired of dealing with it and want out. But they can't get out. You, otoh, have a nice reliable car and suddenly they want it. I would love to know how they presented this idea to you.

If you started paying for that car, YOU would be stuck with the repairs, you know that, right? And they probably know that too, and yet they don't care.

It just makes me angry for you hearing that family members are so selfish and greedy, giving no thought to your family's needs. Doesn't that make you mad? That anger would give me the courage to say, "no way, that doesn't work for us. Good luck to you." I hope you and DH can find the courage to say the same thing.

[Toba]

I also agree ... NO WAY!!

I'm curious what the payment arrangements were supposed to be? Were you supposed to give her your monthly payment in the hopes that she'd make it each month? Because as irresponsible as it sounds she is, she could take your money monthly and never make the payment for a couple of months and then ... poof!! Repossessed car.

Bad, bad, bad idea. But *you* know this already, just from your post. Don't take the guilt. I think gatorsmom is on to something and they might have been planning this scheme for a while. Run away!!

[jerseygirl07067]

oops, hit wrong key

[jerseygirl07067]

As the "responsible" one in my family, I am often approached by family members, especially my mom and sister, to bail them out due to their own fiscal irresponsibility. While we want to help in general, I agree that by doing so, we are actually enabling their irresponsible conduct. Ultimately, our primary responsibility is to our own family and children. If we do have extra to loan, we actually consider it more of a gift and any repayment would be a windfall.

I totally agree that your SIL/BIL are being very presumptuous and rude to even propose the deal. It is so WRONG and UNFAIR on so many levels, which has been articulated by PPs.

As far as liability, IIRC, you are in FL. If so, PPs were correct in stating that you could be liable as the owner of the Honda if your SIL were driving the vehicle because cars are considered "dangerous instrumentalities" under FL law. Additionally, it is unlikely that your insurance would pay on the claim if someone else were driving your insured vehicle as their primary vehicle. As such, your personal assets and security would be at serious risk.

While it is unfortunate that your SIL/BIL are having financial troubles, they need to figure out a solution that does not jeopardize your hard earned financial security. Just say no.


You hit it on the head! I want to thank all of you for your great responses. I wound up showing DH this thread because he is the one who is giving it thought. The fact that he is even thinking about this is giving me quite a bit of anxiety. I think that after reading the threads and the overwhelming responses against the stupid idea, he is realizing that it is too.

The problem is, my DH is very trusting and always gives everyone the benefit of the doubt. It annoys the crap out of me at times! That's pretty tough, since I am the type that thinks people are guilty until proven innocent, lol. :P

This board rocks....thank you all!!!!

[dcmom2b3]

Marcy --

Sorry to chime in late, read your OP yesterday but couldn't respond.

To add one thought, in case your DH is still on the fence:

Insurance fraud is a CRIME. Your SIL is asking you and DH potentially to engage in a CRIMINAL ACT (and one that won't benefit you in the least, says the tiny little amoral part of my mind.)

Ask your DH if he wants to peg your futures on whether an Assistant District Attorney is in a charitable mood on the day that the insurance company refers this scheme to his/her office. . .

[jerseygirl07067]

Thanks to all of you, I had DH read this thread. He is now feeling less guilty and realizes how bad of an idea this is!! Thanks to you all, the BBB rocks!

one clarification though to my original post...my Honda has 205,000 miles on it. Her Charger has 40,000. Nonetheless, our Honda still runs very well, actually. But for all of the reasons you mentioned, you have convinced DH and I now can sleep soundly at night. :)