you can't repo and resell that easily if you are the lienholder. I have a buy here pay here car dealership. You should give a grace period whether five or ten days, generally a 5% penalty of the payment is a late charge. You HAVE to transfer the title to the person you are selling to, otherwise they can not obtain a tag and can not obtain insurance. You fill out the title with the buyer's name EXACTLY how it is on their drivers license. At the bottom of the title there is a section to fill in LIENHOLDER, put your name and address in that section. Charge the buyer an $18 fee, which is what the state charges to transfer the title. THIS IS IMPORTANT! YOU MUST TRANSFER THE TITLE WITHIN 20 DAYS OF THE DATE OF THE SALE IN ORDER FOR YOUR LIEN TO BE PERFECTED. If you were to transfer the title in 21 days after the date of sale and the buyer goes chapter 13 (bankruptcy) then the courts can and will award them the vehicle because you failed to perfect the lien on the vehicle. Keep that in mind with who you are financing. If a buyer goes chapter 13 it is a pain in the ass. The courts and lawyers get paid first, then the lenders, generally it is six months sometimes a year before I ever see a payment and even then they cut down the payment and do it at a prime interest rate. Also if someone has even begun to file the paperwork for chapter 13 you can't contact them or repossess their vehicle. As was stated above, full coverage insurance with you as the lienholder is a must. They will mail you a letter indicating a renewal or cancellation on the insurance. I would not finance a vehicle for someone personally unless I knew them EXTREMELY well and considered them almost family. Otherwise, it's risky business, and there is a reason why I charge 28% interest rates.If you have any other questions or would like to see an example of a finance contract let me know.