Buying a car that is Sale or Return with a dealer
Discussion
I am buying a car that the dealer has on SOR.
They are a small dealer.
What are the legalities of title transfer ?
The dealer suggests I pay him ( I have no specific objection to this - and they have good reviews), but of course he does not own it.
Does paying him give me good title ?
The other alternative is to pay the owner £x and the dealer £y so the legal owner had the money. This is a bit messy and not something I have come across before.
The sum involved is £117k, so a decent chunk of change.
Views and guidance please.
Thank you.
Jeremy
They are a small dealer.
What are the legalities of title transfer ?
The dealer suggests I pay him ( I have no specific objection to this - and they have good reviews), but of course he does not own it.
Does paying him give me good title ?
The other alternative is to pay the owner £x and the dealer £y so the legal owner had the money. This is a bit messy and not something I have come across before.
The sum involved is £117k, so a decent chunk of change.
Views and guidance please.
Thank you.
Jeremy
To expand slightly, I bought a car which was SoR for similar money last year. I paid the dealer all the money and never dealt with the car's owner. I've never heard of paying the owner directly in an SoR situation and it didn't cross my mind to do so.
My understanding is that when the car owner delivers it to the selling dealer, they're (implicitly or explicitly) authorising the dealer to sell it on their behalf. Therefore from the buyer's point of view, you can simply deal with the dealer, pay the money and take the car away and it's yours.
If the dealer fails to inform the previous owner the car's sold, lies to them about the transaction price, or folds the business without ever paying, then that problem is entirely a financial one between the dealer and the previous owner, it doesn't affect you or your right to the car you've bought, because the sale transaction itself was legally valid.
The only exception I'm aware of is if the car owner never entered into an SoR agreement with the dealer. So for instance if the car was at the dealer for servicing and they sold it to you, or had simply been nicked. In those cases the sale would be invalid and you wouldn't own the car, and you would be faced with trying to get a refund back from the crooked SoR dealer. My feeling is that this situation is less likely; in my case the dealer had been advertising the car publicly on AT for several months, so it would be less likely the owner could deny permitting them to sell it.
My understanding is that when the car owner delivers it to the selling dealer, they're (implicitly or explicitly) authorising the dealer to sell it on their behalf. Therefore from the buyer's point of view, you can simply deal with the dealer, pay the money and take the car away and it's yours.
If the dealer fails to inform the previous owner the car's sold, lies to them about the transaction price, or folds the business without ever paying, then that problem is entirely a financial one between the dealer and the previous owner, it doesn't affect you or your right to the car you've bought, because the sale transaction itself was legally valid.
The only exception I'm aware of is if the car owner never entered into an SoR agreement with the dealer. So for instance if the car was at the dealer for servicing and they sold it to you, or had simply been nicked. In those cases the sale would be invalid and you wouldn't own the car, and you would be faced with trying to get a refund back from the crooked SoR dealer. My feeling is that this situation is less likely; in my case the dealer had been advertising the car publicly on AT for several months, so it would be less likely the owner could deny permitting them to sell it.
Word of warning.
Fifteen years ago I bought a new Triumph motorbike off a long established respected large dealer.
After eighteen months I wanted to sell it. so I asked the dealer if they would sell it for me, as I didn't want tyre kickers and test pilots calling at my house.
We agreed a price, and their "cut" would be £500.
Fair enough, After six weeks I had not heard anything, but I thought I won't mither them, they will ring when they have sold it.
A week later, I had a phone call from a guy in Ireland, asking me some questions about the bike, apparently he had bought it off this dealer two weeks before and taken it home over The Irish Sea.
I was livid, that this dealer had not told me they had sold it, so I arranged to go and collect my cheque for the cost, less their commission.
I went down three times and was given the run around, "The boss is out to lunch" etc.
Eventually, after two weeks after I got a bit nasty they coughed up, a luckily for me the cheque did not bounce.
They went into administration six months later and closed down.
SOR? Never again.
Imagine if it was a £100,000 Ferrari.
Fifteen years ago I bought a new Triumph motorbike off a long established respected large dealer.
After eighteen months I wanted to sell it. so I asked the dealer if they would sell it for me, as I didn't want tyre kickers and test pilots calling at my house.
We agreed a price, and their "cut" would be £500.
Fair enough, After six weeks I had not heard anything, but I thought I won't mither them, they will ring when they have sold it.
A week later, I had a phone call from a guy in Ireland, asking me some questions about the bike, apparently he had bought it off this dealer two weeks before and taken it home over The Irish Sea.
I was livid, that this dealer had not told me they had sold it, so I arranged to go and collect my cheque for the cost, less their commission.
I went down three times and was given the run around, "The boss is out to lunch" etc.
Eventually, after two weeks after I got a bit nasty they coughed up, a luckily for me the cheque did not bounce.
They went into administration six months later and closed down.
SOR? Never again.
Imagine if it was a £100,000 Ferrari.
Wacky Racer said:
Word of warning.
...
That's a good warning as to why people should be wary about selling a vehicle with SoR. In that case the dealer "forgot" to let you know they'd sold it, so they could delay paying you and pad their cashflow for a bit longer. Sounds like their cashflow crunch eventually caught up with them, luckily after you had the sale proceeds....
The OP however is proposing to buy a car on SoR. The buyer of your motorbike doesn't seem to have suffered any issues - they agreed a price, paid the money and rode off on their new bike back to Ireland. The only minor note for the buyer is to follow up quickly if the V5 doesn't come through, as dodgy SoR dealers will delay registering the sale with the DVLA since that tips off the owner that their car's been sold. But it's no stress, since you own the car anyway and worst case can send off for a fresh V5.
I.e. as I mentioned, SoR is risky for the seller, not so much for the buyer which is the OP here.
I've often wondered if you buy a car from a dealer which is on SoR and there should be an issue later down the line where does the buyer stand regards Consumer Rights Act (putting aside a dealer can sell or add on a warranty)?
A number of years ago I was on the verge of purchasing a C63 estate but I pulled out because the dealer was a little vague about it to say the least.
A number of years ago I was on the verge of purchasing a C63 estate but I pulled out because the dealer was a little vague about it to say the least.
Wacky Racer said:
Word of warning.
Fifteen years ago I bought a new Triumph motorbike off a long established respected large dealer.
After eighteen months I wanted to sell it. so I asked the dealer if they would sell it for me, as I didn't want tyre kickers and test pilots calling at my house.
We agreed a price, and their "cut" would be £500.
Fair enough, After six weeks I had not heard anything, but I thought I won't mither them, they will ring when they have sold it.
A week later, I had a phone call from a guy in Ireland, asking me some questions about the bike, apparently he had bought it off this dealer two weeks before and taken it home over The Irish Sea.
I was livid, that this dealer had not told me they had sold it, so I arranged to go and collect my cheque for the cost, less their commission.
I went down three times and was given the run around, "The boss is out to lunch" etc.
Eventually, after two weeks after I got a bit nasty they coughed up, a luckily for me the cheque did not bounce.
They went into administration six months later and closed down.
SOR? Never again.
Imagine if it was a £100,000 Ferrari.
Would keeping the v5 and the spare keys in this situation help?Fifteen years ago I bought a new Triumph motorbike off a long established respected large dealer.
After eighteen months I wanted to sell it. so I asked the dealer if they would sell it for me, as I didn't want tyre kickers and test pilots calling at my house.
We agreed a price, and their "cut" would be £500.
Fair enough, After six weeks I had not heard anything, but I thought I won't mither them, they will ring when they have sold it.
A week later, I had a phone call from a guy in Ireland, asking me some questions about the bike, apparently he had bought it off this dealer two weeks before and taken it home over The Irish Sea.
I was livid, that this dealer had not told me they had sold it, so I arranged to go and collect my cheque for the cost, less their commission.
I went down three times and was given the run around, "The boss is out to lunch" etc.
Eventually, after two weeks after I got a bit nasty they coughed up, a luckily for me the cheque did not bounce.
They went into administration six months later and closed down.
SOR? Never again.
Imagine if it was a £100,000 Ferrari.
How did the guy in Ireland get your number?
Jamescrs said:
I've often wondered if you buy a car from a dealer which is on SoR and there should be an issue later down the line where does the buyer stand regards Consumer Rights Act (putting aside a dealer can sell or add on a warranty)?
A number of years ago I was on the verge of purchasing a C63 estate but I pulled out because the dealer was a little vague about it to say the least.
It makes no difference legally, if you buy a car from a dealer then it's a business to consumer sale and you have the same legal rights, the dealer is responsible for the car being in satisfactory condition and fit for purpose.A number of years ago I was on the verge of purchasing a C63 estate but I pulled out because the dealer was a little vague about it to say the least.
There's possibly a slight practical difference in that SoR can be more of an 'asset light' business model as the dealer doesn't have to put up the capital for their stock, which might mean such a dealer could be harder to pursue for any come-back later, but equally the dealers who "own" their stock mostly have borrowed the money anyway. I'd make a general assessment of the selling dealer, not be hung up about the business model.
Yes dealers are often cagey about admitting that a car is on SoR, I don't really know why. The fact the dealer has been upfront about this with the OP feels like a positive to me. But ultimately as a buyer it basically makes no difference to you, you're buying the car from the dealer and they have the same legal responsibilities whether they own it or are selling on behalf of another.
samoht said:
It makes no difference legally, if you buy a car from a dealer then it's a business to consumer sale and you have the same legal rights, the dealer is responsible for the car being in satisfactory condition and fit for purpose.
There's possibly a slight practical difference in that SoR can be more of an 'asset light' business model as the dealer doesn't have to put up the capital for their stock, which might mean such a dealer could be harder to pursue for any come-back later, but equally the dealers who "own" their stock mostly have borrowed the money anyway. I'd make a general assessment of the selling dealer, not be hung up about the business model.
Yes dealers are often cagey about admitting that a car is on SoR, I don't really know why. The fact the dealer has been upfront about this with the OP feels like a positive to me. But ultimately as a buyer it basically makes no difference to you, you're buying the car from the dealer and they have the same legal responsibilities whether they own it or are selling on behalf of another.
Thanks for the response, in the case I was looking at the dealer was almost overly ken to stress they were selling it for a private individual, the insinuation being (I got the impression) that I should consider it a private sale. There's possibly a slight practical difference in that SoR can be more of an 'asset light' business model as the dealer doesn't have to put up the capital for their stock, which might mean such a dealer could be harder to pursue for any come-back later, but equally the dealers who "own" their stock mostly have borrowed the money anyway. I'd make a general assessment of the selling dealer, not be hung up about the business model.
Yes dealers are often cagey about admitting that a car is on SoR, I don't really know why. The fact the dealer has been upfront about this with the OP feels like a positive to me. But ultimately as a buyer it basically makes no difference to you, you're buying the car from the dealer and they have the same legal responsibilities whether they own it or are selling on behalf of another.
Good to know for the future
Jamescrs said:
Thanks for the response, in the case I was looking at the dealer was almost overly ken to stress they were selling it for a private individual, the insinuation being (I got the impression) that I should consider it a private sale.
Good to know for the future
Why would be the obvious first question, followed by would I be buying it from your dealership or from the individual…Good to know for the future
The dealer telling you it's an SOR sale should ring slight alarm bells.
Perhaps they're hoping you'll have in your mind that CRA won't be applicable?
So before you proceed print hard copies of the dealer advert, both the Autotrader one, and their own website one if they have it.
So if you did have to prove you bought it from them, you have their adverts, and your traceable payment to them.
And of course, make sure the bank you're paying into is the dealers, not some other person that a dealer might say "oh, she's a director of the dealership"
And as already mentioned on here, what ever the dealer might write on the invoice, nothing will cancel out your rights as a consumer, or the CRA..
Perhaps they're hoping you'll have in your mind that CRA won't be applicable?
So before you proceed print hard copies of the dealer advert, both the Autotrader one, and their own website one if they have it.
So if you did have to prove you bought it from them, you have their adverts, and your traceable payment to them.
And of course, make sure the bank you're paying into is the dealers, not some other person that a dealer might say "oh, she's a director of the dealership"
And as already mentioned on here, what ever the dealer might write on the invoice, nothing will cancel out your rights as a consumer, or the CRA..
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