Can I Finance a Car For Someone Else?

When exploring car finance, you may be wondering whether you can secure a deal for somebody else 🤔

There are a few reasons you may be considering taking finance out for another person. Maybe you have a better credit score, or the other person is a young driver.

Whatever the reason, before you apply for car finance for someone else, you need to know what is and isn’t allowed.

For example, taking out car finance for someone else and lying about it would be classed as fraud 😟

If you don’t want to land yourself in hot water, read on to learn everything you need to know about taking car finance out for another person.

Got a specific question? Why not jump to:

Understanding joint car finance agreements

Joint car finance agreements enable two people to share responsibility for a car's financing.

This type of agreement is popular among couples, friends, and family members. It gives you the option to help someone with a weaker credit history secure a car finance deal.

Both parties in a joint agreement are responsible for ensuring that the monthly payments are made. So, if one person falls behind or defaults, the other is legally obligated to make the payment.

When applying for joint financing, both applicants undergo a credit check. This can be beneficial if one person has a better score.

However, it also means that both credit scores may be affected, positively or negatively, depending on how well you manage the joint agreement.

Accommodation finance explained

Accommodation finance, often referred to when one person helps another get a car on finance, can be a way of improving the terms of a finance agreement but make sure you check with the lender if they allow this arrangement.

Typically, this type of agreement is made when someone with a good credit history helps someone with a poor score, get the finance they need.

It can be a parent helping a child, a spouse assisting their partner, or a friend helping another.

The primary purpose of accommodation finance is to leverage the better credit score of one applicant to help the other.

It can help someone with a poor rating get the finance they need, at a better deal than they would otherwise receive.

As the risk of a lender not being able to get a vehicle or their money back is greater than a more traditional car finance arrangement, it’s very rare that finance providers offer this option and most lenders will specify in their terms and conditions that the person taking on the finance is the main driver.

Accommodation finance also comes with a legal risk of defrauding lenders if you don’t properly declare this arrangement at the point of application.

Deceiving and defrauding a lender, for yourself or someone else, is illegal and risky. Both people could face criminal charges and have trouble getting future loans due to damaged credit history. Always speak to the lender if you want to take out finance on behalf of someone else.

Pros and cons of having car finance in another person's name

Having finance for a used car in another person's name can offer several advantages, especially if you're facing credit issues.

However, it's important to understand the pros and cons before deciding if it’s the best option for you.

Let's explore the benefits and potential pitfalls of this arrangement:


  • Accessible for those with poor credit
  • Potential for better terms
  • Shared responsibility

For those with a poor credit history, the main benefit is typically increasing the chances of getting finance.

With the backing of someone with a good credit history, there's the chance to secure a more favourable car finance deal.

Both parties can also agree on sharing the costs and other responsibilities associated with the vehicle, making it more affordable.


  • Legal responsibility
  • Risk to credit score
  • Potential for disagreements

The person whose name is on the finance agreement has the main legal responsibility for ensuring payments are made.

If there are any missed payments or defaults, it can harm the credit score of both people who are in the agreement.

There can also be conflicts regarding car usage, payment responsibilities, and other related issues.

Once you’ve weighed up these pros and cons, you’ll have a better idea of whether a joint loan would be the best option.

More car finance guides

Preventing fraud in car finance agreements

When considering financing a car for someone else, make sure you tell the lender who will be driving.

If you take out car finance for somebody else and don’t declare it in the application, you will be committing fraud.

It’s also possible to be a victim of fraud on car finance.

There are so many car finance deals available, and sadly not all of them are genuine. Before you sign anything and make any payments, check the reputation of the lender.

Transferring car finance agreements

There may come a time when you want to transfer a car finance agreement to another person.

It could be that your financial situation has changed, or you no longer need the vehicle.

Unfortunately, it isn’t possible to simply transfer the agreement to someone else. That’s because the agreement you entered was based on your personal circumstances.

So, if you do want to sell the car for example, you’ll need to first pay off the remaining finance.

At Carmoola, we currently do not offer joint car finance, but we do have an excellent early repayment calculator.

This will help you figure out how much it will cost to get out of your current agreement.

Remember, taking out car finance for someone else and hiding it from the lender is illegal.

If you are looking for ways to transfer your policy over, always speak to the lender to see what options you have 😀

FAQs about applying for car finance with somebody else:

What exactly is accommodation finance?

Accommodation finance is when one person helps another to get a car finance deal. The person helping usually has a better credit history, making it easier to secure favourable terms.

What issues or challenges can arise in such deals?

With accommodation finance, potential challenges include:

  • Disagreements over payment responsibilities
  • Both parties can have their credit score impacted by the agreement
  • Potential legal disputes if the terms aren't met

Can a third party's credit history affect the car finance deal?

Yes, a third party's credit history can significantly influence the terms and approval of a car finance deal. If they have an excellent score, it makes approval more likely, and the potential for better terms. If they have a poor score, it will make securing the finance more difficult and could lead to higher rates.

Can you finance a car for someone else?

Yes, it's possible to finance a car for someone else. Referred to as accommodation finance, the finance is in one person's name, but the car is driven by someone else. You should always ask the lender if they allow this type of arrangement to avoid committing fraud. 

Can someone else insure my financed car in the UK?

In the UK, the primary driver must be the one taking out the insurance policy. However, other people can be added onto the policy as named drivers. The policyholder should always be the person who drives the car most frequently.