It seems like you've found a pretty good deal on a decent car, but you're then told that the seller doesn't actually own the vehicle, the bank does. What does this mean for you? It may cause you to take a step back and really think about your decision before agreeing to purchase a car with a lien.
Need a Car Fast? This May Not be the Deal for You.
If you go through the necessary steps to correctly purchase the vehicle with a lien attached (and you should), it can be time consuming, and this isn't helpful if you need a car sooner as opposed to later.
Simply giving the seller the money to pay off the lien would require a real leap of faith. What if they just pocket the cash? The bank would still own a vehicle that you paid for, and you would be up the proverbial creek.
- The lien must be paid first. You won't be able to register the car until the seller signs the title over to you, and that cannot happen until the lien is paid. It is illegal to drive an unregistered vehicle, and you won't be able to sell the car in the future if you don't hold a title that was properly transferred.
- You should do the legwork yourself. The only way to be sure that the lien is paid and get the title yourself is to go with the seller to the financial institution that holds the lien. And if you do choose to go this route, call ahead before you make the trip to make sure that the title will be ready (in states where the lien holder holds the title). Otherwise, you will have to wait for the institution to mail you the title.
- A third party will be involved if you're financing. If you don't have the cash to pay the lien holder and the buyer, your lender will need to work with the lien holder. This means that your loan provider will pay the lien holder and the seller, and this lender will now be the lien holder that you must pay off in order to acquire the car's title (or receive a release of lien letter in states where the lien holder does not hold the title).
Want an Easier, Quicker Way to Purchase?
If you want a car now and quickly, Auto Credit Express can help. Even if your credit isn't in the best possible shape, our qualified dealers are connected to lenders that can work with your situation. You'll get a hassle-free and enjoyable car buying experience by filling out our fast, simple and secure online application. Get started today, and you could be driving tomorrow.