Buying Private Party and the Seller Has a Lien

[ARCHIVED THREAD] - Buying Private Party and the Seller Has a Lien

Posted: 5/31/2020 7:31:15 PM EDT

I'm looking at a used vehicle locally- seller has been up-front and easy to work with.

So the only drama is that there's a lien on the vehicle from an out of state credit union. He'd have to pay that off to get the title, so I wouldn't get the title until he does.

So I guess I would pay him the money, he'd pay off the loan, they'd send him the title, and he'd send it to me. Then I could register it in my name?

EDIT to add: I will be paying cash for the vehicle, not getting a loan.

There's always the worry he'll blow the money on booze and loose wimmin, then I be hosed.

I would love to hear from anyone who has done this, either as a seller or a buyer.

Posted: 5/31/2020 7:37:40 PM EDT

[#1]

Dont do that. Work with the credit union direct or just walk.

Posted: 5/31/2020 7:46:12 PM EDT

[#2]

Work with the cr union director it will not end well

Posted: 5/31/2020 8:14:49 PM EDT

[#3]

Sounds iffy. I recall someone selling a car locally that was in a similar predicament. I was interested at first thinking it would be a quick flip. But I told them they would have to pay the loan off FIRST, get the title, and then we would proceed to close. Which obviously they did not want to do because they didn't have the money. So, no thanks!

If they don't have the title to sign off to you and you give the money, I believe that's quite the risk to take. I would stay away. There will be plenty of better deals from sellers with the title in hand.

Posted: 5/31/2020 8:19:19 PM EDT

[#4]

I've done this before but the bank of the seller was local. My credit union handled everything and paid off the lien and handled all the paperwork before transferring the car over to me. Being out of state it may not be worth the hassle.

Posted: 5/31/2020 8:59:01 PM EDT

[#5]

Pay the balance of loan to credit union, extra to seller, credit union sends you the title

Posted: 5/31/2020 9:27:37 PM EDT

[#6]

Quote History

Quoted:
Pay the balance of loan to credit union, extra to seller, credit union sends you the title

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This and a POA.

Posted: 5/31/2020 9:54:27 PM EDT

[#7]

Quote History

Quoted:
Pay the balance of loan to credit union, extra to seller, credit union sends you the title

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Last part isn't necessarily correct - sure isn't that way here, and I'd actually be surprised if it were correct anywhere.

The party with the lien merely has a lien against the title - when they release the lien, they don't assume ownership, and therefore can't give you the title. It's not theirs to give. The soon-to-be-previous owner still has to sign the title over to the buyer, once the lien is removed.

But otherwise, yes. Send off a check or otherwise arrange payment with the financial institution, with the remainder to the seller.

I would only do so if you are taking possession of the vehicle - I did this once before, and I was okay with it in part because of that fact. I had the car, a check for the bank, and a bill of sale. He had the extra cash and a copy of the bill of sale. When the bank released the lien, we then met up one last time to transfer the title. (He could have gotten the title, signed it over, and sent it to me, but it made more sense to just meet up at the BMV, since we would both have to each go there anyway.)

Posted: 5/31/2020 11:02:08 PM EDT

[#8]

I've been on both sides of similar sales. Do a little bit of research on the seller to determine if they are a good credit risk.

Send balance of loan to the credit union, rest of funds to the seller, get a bill of sale and physical possession of the vehicle. Seller forwards on the signed title when they receive it from the CU.

Posted: 6/1/2020 9:21:34 AM EDT

[#9]

I have done this except I took a loan. We met at my bank, my bank did all the work with his bank. Money was exchanged and paperwork was signed. Off I went with my new truck and I actually dropped him back off at his house (Was a friend of a friend so I knew of him)

Maybe call your bank and see what they can do. Maybe take a loan and do it similar to what I did and just pay it off on the 1st month.

Posted: 6/1/2020 9:22:53 AM EDT

[#10]

Appreciate all the replies!

I worry about the seller losing motivation once he's clear of the loan and has the money. So I send the CU the loan balance and the rest to him, then I wait.... Then the CU sends him the title and I can only hope he is still interested enough to mail it or meet up again.

In the mean time, I have a vehicle in my driveway that I can't register in my name?

He seems on the level if that matters. He's going to call the CU today and find out what they have to say, then we'll go from there.

Posted: 6/1/2020 9:48:29 AM EDT

[#11]

Have the seller sign an authorization for payoff form to send with the payment.. the CU will send you the title. Also have them sign a secure power of attorney this will let you sign their name to the title when it arrives. Works in Oregon check with local DMV.

Posted: 6/1/2020 10:32:47 AM EDT

[#12]

Here the dealers and banks are doing electronic titles.

Before buy meet seller at bank, pay loan, get title. Not now.
After loan is paid, seller must go to DMV to get title.

I paid off a load on my truck this year, Credit Union said I had to go to DMV to get a title.

Posted: 6/1/2020 10:45:26 AM EDT

[#13]

No way I would consider any deal without clear and notarized title in hand.

Vaporware dreaming is anything else, and will lead down the path of disappoint to a ride on the fail boat.

Posted: 6/1/2020 1:47:31 PM EDT

[#14]

Quote History

Quoted:
I have done this except I took a loan. We met at my bank, my bank did all the work with his bank. Money was exchanged and paperwork was signed. Off I went with my new truck and I actually dropped him back off at his house (Was a friend of a friend so I knew of him)

Maybe call your bank and see what they can do. Maybe take a loan and do it similar to what I did and just pay it off on the 1st month.

View Quote

This looks like the best option to me. Your bank will take care of all of the title BS, and you could simply pay it off right away.

Posted: 6/1/2020 3:16:42 PM EDT

[#15]

The credit union my have a co share agreement with a local credit union. They could possibly handle it that way.

Posted: 6/1/2020 6:59:09 PM EDT

[#16]

When I hand over a big envelope of cash in one hand, I'd better be getting the keys & an unencumbered title back in the other.

Posted: 6/1/2020 7:06:40 PM EDT

[#17]

Not a problem. Talk to the loan holder. Get a check made out to the seller's bank and the seller. The seller can't cash it by himself. The bank wants their money so they make sure they get theirs and give the seller the rest. I've done it and it's not a big deal. You are right to be concerned but it's not hard to protect yourself. Don't deal in cash....deal with checks. If you are getting a loan on the vehicle through your bank, they can handle everything with the seller's bank. Banks know how to protect themselves and will protect you in the process.

Posted: 6/1/2020 8:20:30 PM EDT

[#18]

This is the text message I got:

Okay, I talked to the credit union again and they informed me they have the physical title on site. Here are our options as far as I can tell:

Option 1) Your bank wires the money to my credit union, once received, the CU overnights the title to me to sign, the next day my wife and I drive up to your place and deliver the Jeep and title; or you drive down and pick it up....either way.

Option 2) You have the bank wire the money to the CU, once received the CU, overnights the title to me to sign and send you. In the mean time we sign some sort of contract allowing me to release the Jeep to you before having the title in hand.

I prefer option 1 but I can do either

View Quote

I think I'm going to pass.

Posted: 6/2/2020 1:37:25 AM EDT

[#19]

Envelope draft, if they still do those.

It's an envelope with the printing for a bank draft. You instruct the bank you are using to NOT cash the draft unless it come with a clear, non-salvage title for the car VIN number inside of it when presented to the bank.

You give the draft to the car owner. He takes it to his bank/credit union that is holding the lien. The bank puts a lein release adn the signed title in the envelope. They keep the vehicle payoff, the seller gets the rest -- which they get when they send the draft in for collection.

You pick up the title at your ban when they pay off the draft.

Posted: 6/2/2020 5:57:02 AM EDT

[#20]

Is it really worth all this aggravation for something as common as a Jeep?

Posted: 6/2/2020 7:49:18 AM EDT

[#21]

Quote History

Quoted:
This is the text message I got:

I think I'm going to pass.

View Quote

If they have the paper title, you meet seller at bank. Hand them money, they hand over title. Typically he can sign it there and they will notarize it for you.

Posted: 6/2/2020 8:01:40 AM EDT

[#22]

I’d offer him a deposit and tell him to pay it off. Once he has title come on back with balance and get car and title.

Posted: 6/2/2020 8:30:47 AM EDT

[#23]

There's no going to the bank, it's a credit union two states away.

Posted: 6/2/2020 8:47:17 AM EDT

[#24]

It happens all the time. Just meet him at the credit union and pay him/them. Done

Posted: 6/3/2020 2:45:15 PM EDT

[#25]

My BiL sold his dually for 20k to a buyer. He got 19k from the buyer to pay if off and get the title. Buyer took the vehicle that day the buyer paid. When my BiL got the title he met the guy and got the other $1k and signed it to the other guy.

So I would set it up that when the guy brings the title he gets the rest of the money. When you wire the money I would take the jeep that day.

Posted: 6/3/2020 3:55:34 PM EDT

[#26]

I called it off this morning- too much drama for a vehicle I haven't even seen in person, and I just don't feel it anymore. Maybe I'm having my buyer's remorse early...

I'll keep driving my jeep for a few more years.

He says he has another party interested, so they'll work it out somehow. It's a Rubicon so it shouldn't be hard to move.

Posted: 6/5/2020 10:29:34 AM EDT

[#27]

My credit union sent me the title when I informed them I was looking to sell privately.

Posted: 6/5/2020 11:01:19 AM EDT

[#28]

Quote History

Quoted:
My credit union sent me the title when I informed them I was looking to sell privately.

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You left a lot out there.

How much did you owe the bank when they did this?
Bank in state or out of state?

Posted: 6/5/2020 5:55:49 PM EDT

[#29]

The whole thing sounds like a huge pain in the butt. Lots of other vehicles out there without title issues to choose from.

[ARCHIVED THREAD] - Buying Private Party and the Seller Has a Lien

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