If you add your husband's name to your car will that affect the outcome if you are sued?

Lawsuits and the Names on a Car

An absolute answer depends on your state law.

Generally, the person/company suing you has no legal interest in your car until they get a judgment against you and file a lien against your property (unless they are the car finance company or you voluntarily gave them a lien on your car). So if you transfer it before the case is over it cannot be attached by a later judgment lienholder.

However, anybody harmed by a transfer can get it invalidated under your state's fraudulent conveyance/transfer act. A transfer of property after a lawsuit begins would be a factor indicating that it MIGHT be fraudulent.

If you can show that the transfer after a suit is filed did not hinder the person/company's collection rights, the transfer should not be invalidated. Depending on your state law, you could show this in many ways. For example:

(1) the transferee had a legal interest in the property equal to what was transferred (i.e. when you bought it you agreed that it would be owned by both of you -- thus he had a pre-existing legal right to sue you for his half). This argument would be very strong if he paid for half, or his half was a marital gift (you gave him half because you love him), or you live in a community property state and it was bought with marital funds (money received after you were married). Even in non-community property states, the law may give a spouse an interest in property bought with marital funds.

(2) the person/ccmpany could not attach the car (check your state's exemption from attachment provision). If the car is exempt from attachment (which it is in many states) it is impossible to defraud the person/company by its transfer.

(3) When you transferred the car, you had other assets having a value that exceeded what you owed the person/company.

(4) Anything else showing the person/company is in no worse shape as to collecting than he was before the transfer. Check your state law.

Remember, if you transfer the car, it will require the person/company to file another court action (fraudulent conveyance/transfer action) before they can get your car. So they'd have to win the first case, then file and win another. If you don't owe them much, and/or they think you have a good defense to fraudulent conveyance/transfer, they may not even try.

Other input from FAQ Farmers:

• Do you mean like having an accident? Or being sued for owing money? If you owe money on the car, it will still be repo'd if you default, whether or not your husband is on the title. If you are being sued and the car is paid for, but you can't exempt it, it is considered an asset by the court trustee. It could be sold if they think they could get enough money to pay the debt. If the suit has been filed and you try to protect the car by putting him on the title, that is fraud. I am not sure what the penalty would be though, probably losing the entire amount the car is worth, or something like that.

• Adding your husband's name to your car has no effect on the outcome of a suit against you, unless you live in what is known as a "community property" state. I believe that is what you are thinking of. In a community property state (this is my personal opinion only, but it arises out of my experience) if the car was bought with "community" funds (funds brought in after the marriage) a suit against you alone would not force you to relinquish your car, as half of it belongs to your husband. But if you bought the car on your own, you might be forced to relinquish it. You should probably see a lawyer. Bankruptcy laws are federal and apply to all states, but community property and credit card debt actions depend on the laws of your own state. Have you contacted the credit card company to try to work out an arrangement with them?