@smorgan103 - you are getting into banking questions and not tax questions
if your parents (and I do mean both parents) purchased the car, the bank would require then to be the borrower, but certainly you could be a co-sgner. or you could just pay the bank on their behalf. As long as those payments do not exceed $34,000 in a year, you don't trip up any gift reporting requirements.
As the owner, they would have to take out insurance on the car.
Personally, i don't see any other 'legal issues...they own the car and they authorize you to drive it.
But do review their tax return. You said they were retired. If there income does not generate $7500 of tax liabiltiy (look at Line 22 of Form 1040), they won;t be able to take advantage of the entire tax credit. the tax credit is $7500 or Line 22 whichever is less. The rest is lost.
