HOW TO AVOID ARGUMENTS
1 Decide who legally owns the car
Sometimes having a single owner with a second party enjoying access can work better than co-ownership, especially if one of you is willing to take on the responsibility if the other wants out at some point. It is crucial that this is understood from the start, though, to avoid any relationships turning sour. You can only have one keeper on a logbook but that doesn’t necessarily mean that the named person is the owner. If you want to legally co-own the car, it’s wise to have a vehicle owners’ sharing agreement. A solicitor will draft and review one for around £200. Alternatively consider a ‘lite’ version – you could share classics, giving a friend access to yours if you have access to theirs.
2 Why a legal contract is sensible
Unexpected bills will crop up with classic ownership and sometimes unforeseen things happen. For this reason, a legal contract is the sensible option. The contract should clearly state that both parties are co-owners and you’ll need clarity on what happens if, for example, the worst happens and an owner passes away or if one of you wants to sell the car. It will need to state who gets what percentage of any proceeds and who has responsibility for what if a big and unexpected bill needs to be paid. In the first instance, it would be best to speak to a solicitor for advice on how to draft such an agreement in such a way that it holds up in law.
3 Keep the receipts, details of important transactions and dates
Most of us probably keep receipts anyway for history files, but it’s absolutely critical that you do this as part of co-ownership. Decide who would be best at keeping a file and make sure that dates, receipts and details of expenditure are recorded so that each party knows exactly how much is being spent on what. If any nasty bills do crop up, talk them though and agree the best course of action – you shouldn’t go through with any modifications or major changes to a car without the co-owner agreeing to them first. One sound idea might be to start a float, where each person puts in a set amount of money each month to stay on top of maintenance costs or fuel – and when big bills do land, come up with a plan for how they will be paid together.
4 Be clear on where the car is stored, when and for what duration
You need to be very clear on this. Who has access to the car and when is important to make sure that shared ownership runs smoothly without you treading on each others’ toes. You also need to make sure that both parties are clear on who gets the car for how long, and that you’re both happy with where it’s being kept. Equally, if you agree to keep the car in a locked garage, don’t then leave it out in the rain overnight – you’d be annoyed if your co-owner did that to you...
5 Decide who the car is insured with and who the named driver is
Agree on which insurer offers the best for what you need, be honest about the mileage you’d like to cover – shared ownership can mean a classic gets used twice as much – and make sure that your insurer knows. They often take mileometer readings and you don’t want to fall foul of any agreed mileage. Also, be clear with your insurer how many miles the named driver will be covering and make sure that they also know that you are co-owners. Most classic insurers have actual people on the other end of the phone, which makes this process easier and they’ll want to speak to both of you. Decide who the policy holder will be and who will be the named driver.
6 Share a car that you could each feasibly buy outright
One of the keys to co-ownership working well is that neither party feels any undue pressure. You might be happy with going for a £40,000 car with £20,000 each, but if you’re scared of being locked into an agreement, settle on a classic that you can both easily afford to buy. This means that either party would feel that they could walk away if any unexpected financial pressure hits, and the lack of pressure will mean that both are in it for the right reasons. Not going for broke on buying a car together might also mean that you each have more money to enjoy and maintain your car together – or have some spare cash for the event you’ve always wanted to go to. Be realistic about your expectations from the outset and only settle on a car when you’re both 100 per cent happy. It’s a big commitment, but it’s also supposed to be fun.
7 Each party should play to their own strengths
Scared of welding but love polishing? Hate wiring diagrams but a whizz with interiors? Make sure that you know each other’s strengths and weaknesses to get the best out of yourselves and the car. It may be that there is a weak spot for both of you that needs attention, so make sure that you agree on who will do the work and get a price before it is carried out. Also make sure that you trust each other. The car is going to be a source of pride for both of you so ensure that you’re comfortable before your co-owner starts welding new panels. Likewise, be respectful. You might think that a coffee cup left on the seat isn’t a big deal, but how would you feel if they returned the car to you like that?