What would you do? Someone wants to borrow my car, 3000 miles, $400 bucks  - worth it?

Unless I had reason to know that my dad was a lousy driver, or that my car wouldn't go 3,000 miles without breaking down, I'd lend him the car for nothing. You know, just as one of those things you do for family. If my dad was generous enough to offer me money to use my car, I'd take the money if he really really insisted. Just because parents often do things like that for their children, as a way to help out without merely doling out cash.

I don't know, if there was an accident and it came out that your dad using your car was not merely a favour from one relative to another but a business transaction, if that would affect your insurance coverage. And I wouldn't ask my insurance company about it. Maybe your dad can pay your next 3 months' phone bill, or something, rather than actually giving you money.

If you rent dad your car, remember your car is not covered under insurance (unless your policy is the same as your dad's).  This is because he is RENTING the car not borrowing the car which makes it a business transaction.

If you are getting the same amount as a rental car agency, he should just use the rental car agency so there is no problem with insurance, etc.

If my parents wanted to use my car for whatever, I'd let them.

The cost of car ownership is placed at fifty cents a mile on the average. If your dad wants to compensate you for using the car then fifty cents a mile minus cost of gas per mile would be a fair amount.
So dollar wise it is not an equitable arrangement.
That said, if my Dad wanted to borrow my car- I would let him and not bring up money.
If he can rent a car with out having to pay by the mile for the trip for 400 bucks, it would be cheaper for both of you. Plus no insurance hassles if something goes wrong as in an accident or other possible repercussions (unexpected car repairs).

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Let him use the car and forget the $400. I would be more concerned about "hiring out" the car. Let him use it and if he wants to contribute to its upkeep,don't accept more than $100,he's your father 

If you need the $400 and don't need the car for the amount of time he's going to use it, then take the money.  3000 miles is nothing for today's cars.  They make them a lot better than they used to.

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A few years ago my wife lent her parents her vehicle to take on a long journey ( they had a gas guzzling pick-up truck and my wife's car was far better on fuel ).
There was never any discussion regarding compensation.  We just made sure our insurance coverage also covered them and we let them use her car.

My dad worked his butt off to send me to college.  I will not charge anything if he wanted to borrow my car.  I will even give him gas and hotel money.

The US government allows 55 cents per mile for business use of a personal car.  That works out to $1650.00 in expenses for the trip.  Of that amount about $450 would be for gas if dad has to buy it.  All other expenses related to the use of the car works out to $1,200.00.  And you would not have a car to drive.  Let him rent one.