Howdy! Hope everyone is doing well.
I'm searched for quite a while, here and elsewhere, and though I've come across semi-relevant purchasing agreements and "contract for title" type forms, I can't quite find what I'm looking for (perhaps I'm not using the correct terminology). Obviously I can draft my own, but would feel better having guidance to make sure all bases are covered. The transaction is taking place in Jefferson County, KY.
An elderly friend (hereafter "seller") is selling their motorcycle to one of their "friends" (hereafter "buyer"). Thus far, they have agreed the buyer will give down payment amounting to nearly half the purchase value within the next few days, and the balance will be paid in monthly $200 increments until satisfied (which, if all goes smooth, should be within the year). The seller has already allowed the buyer to take physical possession of the bike (she is aware, of course, that's a silly thing to do before being paid in full and particularly before a contract has been signed - friend or no friend...but neither here nor there now), but the title will not be transferred until the loan is paid in full. Though payments are to be made monthly, their agreement regarding "default terms" pretty much boils down to the balance must be paid in full by April 2012. I'm encouraging her to be a bit more proactive and nail down some dates...i.e. payments to be made on the 7th and no later than the 12th of each month....and to apply a late fee of some sort for payments received after the 12th (the latter mostly to encourage prompt payment, as the seller doesn't have too many folks looking out for her, I don't personally know the buyer well, and, as the seller has given me authority to handle matters such as this, want to make the strong impression to the buyer they are dealing with a "to the letter" gal rather than an elderly lady they may intentionally or unintentionally take advantage of). Further, I am strongly encouraging that the two agree the buyer is defaulting on the loan once two consecutive monthly payments are missed so that the seller doesn't have to wait til April 2012 to repo the bike.
Because the buyer already has physical possession but will not have title til balance is paid, what all must be done to protect the seller from certain liability issues (i.e. wrongful death suits, tickets, etc.)? Is contractually obligating the buyer to have full coverage til loan is satisfied enough? Should the seller have the full coverage policy, ensuring her insurer knows she is not the normal driver?
Does someone have a contract template that would apply to this sort of arrangement, addressing matters all matters I've discussed here - i.e. payment plan, late fees, default terms, full coverage insurance (or other advised should-haves as asked above), and ultimate title transfer? Are there other matters that should be addressed in an arrangement such as this?
Thanks a million in advance!