chrisd0729

A friend of a friend is going through a divorce and needs to dump his '05 quick... he basically needs his payoff and to get out of it immediately. 2005 auto, black/tan leather and 77k, I may get it for $18k.

My question is, has anyone bought a car from someone that had a lien on it and had to front the $$ to pay off the loan and wait for the title? My gut tells me this isn't a good move to put out $18k and wait but, the devil on my other shoulder is really making me think about it.

johnodrake

Take the owner with you to his bank for the transaction. Give the money to the Bank.

beav626

LMB-Z

dvilin

Only way to do it.

C-INRED

Agreed. Make sure you're dealing with the bank (lienholder) and that you have the proper documentation showing that you've purchased the vehicle (i.e. bill of sale and signed off title) when you pay the money.

I would think that you should write the check and that the title should be signed over to you by the owner and the bank should sign the lien release on the title all while you're sitting there. Then all you should be waiting for if for the state to get you the new title with your name on it. You may get an application for title at that time also. The process can vary a bit state by state.

mpuzach

I'm in complete agreement with what the others have already posted. I'll add this: On several occasions I've been the seller of a car with a lien. The lien holder was sometimes not a local bank (i.e. it was the car manufacturer's lending arm) so a simple trip to the bank was not possible. In such cases I obtained the pay-off amount, then met with the buyer. I had the buyer give me two checks, one made out to the lender for the pay-off amount and the other made out to me for the remainder of the selling price. I then gave the buyer a signed bill of sale with all of the details (VIN, description of car, date, purchase amount) and mailed the check to the lender with the buyer witnessing the mailing. At that point the buyer's only leap of faith was trusting that when I received the title in the mail from the lender, I'd sign it over to the buyer and mail it to them. This was in CA - the lender held the title and did not physically send it to the registered owner until the loan was paid off.

Oh yeah - one other thing: At the time of the transaction I filled out a "Release of financial liability" form and sent it to the state. This essentially notified the state that I had sold the car and that I was no longer liable for any tickets, accidents, etc. A copy of this form should also be given to the buyer as a little extra security.

tomiboy

Yes with a guy out of state. Title came in the mail. At least this is a friend. I would jump!

obxchartercaptain

Make sure the wife is NOT in the car....

AORoads

Agree with John (odrake) and/or Mike (puzach) methodology. Nice to have smart people on this forum, isn't it?

hawkgfr

Bank, no matter how good the friend is...


Good luck..

Eppieguy

Well, if it's financed through a bank like GMAC / Ally, you aren't going to the bank to pick up the title, also many larger banks do not hold the title locally so again you probably won't get the title on the same day. You need to trust and document with a witness, if it's a good deal and he's a good friend I'd concider it but beware!

If the title is in a local bank I agree with the above, go to the bank with the cash and the owner, pay it off and get the title.

Poppa Bud

Make the check out to BOTH your friend and the lienholder. He can't cash it but he has to sign it for the bank to be able to take it.

Good luck, if the car is in good shape it sounds like a good deal.

bsjones1335

Go for it...For $18k sounds like a good deal. I sold about 7 cars over the last few years that I owned some were paid off but most had a lien. The process is very simple. Just cut the check to your friend in his name or bank's name, get a bill of sale (copies for both parties) notarized in most states. He gives you the car and you wait a few days or a week and you should have the title in your hand mailed from the bank. Don't over think it....

Also, insurance gives 30 days for you to add new car to your policy along with getting car registered with DMV, they realize it takes time to get the title so DMVs/Insurance companies give you that time. Good luck with your purchase

phileaglesfan

$18k is a real good deal providing it is in good mechanical shape. The bank might wait for your check to clear before the title is released.

gunterwalker

What I did.