Buying a private car which has finance on it

[cayman-black]

Hi all as above what is the best option when buying a car which is financed? thx.

[chrisch77]

Pay it off…..

You ask seller to obtain settlement figure then you call the finance company when you go to pick up the car and pay off the finance over the phone, balance to the seller. Fill out V5 and drive away.

[ZX10R NIN]

It's as simple as above.

[Sir Bagalot]

ZX10R NIN said:

It's as simple as above.

No it isn't

chrisch77 said:

Pay it off…..

You ask seller to obtain settlement figure then you call the finance company when you go to pick up the car and pay off the finance over the phone, balance to the seller. Fill out V5 and drive away.

The last two cars I've personally bought have had finance on (sellers were open about this). Both cars were bought new and had finance from the Manufacturer. Settlement figure was obtained (in one case the outstanding finance was more than the car was worth). In both cases the finance companies will only take card payment from the account holder and not a third party (you).

So what do you do?

Walk away

or

Take a calculated risk.

The first purchase was from a family man. Not helped that he was moving abroad to work. From pictures in his home I knew his line of work, had checked Rightmove to confirm his story of renting his house out and also the small matter of investing £3 in a Land Registry search to confirm he did actually own the house. I paid him in full, he then called the finance firm involved and paid the car off, handed the phone to me and they confirmed they no longer had any interest in the car and emailed confirmation.

The recent one was from a lone female who didn't want me in her flat, again moving abroad. Again I had seen the V5 to confirm address, I knew where she worked and again I invested £3 in a Land Registry search to confirm he did actually own the flat. We sat in the car. I paid her. She then called the finance company and paid the finance off whilst on loudspeaker.

[J1990]

Sir Bagalot said:

ZX10R NIN said:

It's as simple as above.

No it isn't

chrisch77 said:

Pay it off…..

You ask seller to obtain settlement figure then you call the finance company when you go to pick up the car and pay off the finance over the phone, balance to the seller. Fill out V5 and drive away.

The last two cars I've personally bought have had finance on (sellers were open about this). Both cars were bought new and had finance from the Manufacturer. Settlement figure was obtained (in one case the outstanding finance was more than the car was worth). In both cases the finance companies will only take card payment from the account holder and not a third party (you).

So what do you do?

Walk away

or

Take a calculated risk.

The first purchase was from a family man. Not helped that he was moving abroad to work. From pictures in his home I knew his line of work, had checked Rightmove to confirm his story of renting his house out and also the small matter of investing £3 in a Land Registry search to confirm he did actually own the house. I paid him in full, he then called the finance firm involved and paid the car off, handed the phone to me and they confirmed they no longer had any interest in the car and emailed confirmation.

The recent one was from a lone female who didn't want me in her flat, again moving abroad. Again I had seen the V5 to confirm address, I knew where she worked and again I invested £3 in a Land Registry search to confirm he did actually own the flat. We sat in the car. I paid her. She then called the finance company and paid the finance off whilst on loudspeaker.

That's odd, to say the least. Who were the finance companies in these instances?
I've never had a problem paying off a 3rd party's finance or having mine paid off when selling with finance still on the vehicles. Admittedly the most recent time I've done this was ~18months ago but I wouldn't expect the finance company to care in the slightest so long as they're receiving and verifying the funds before any transfer of ownership takes place.

[BertBert]

When I last did this, there was a problem of timing in that with the amount of money on finance it wasn't possible to do it over the phone with my bank. Yes they would take the instruction, but the payment would happen some time in the day. That mean essentially that I had to make the payment before I was with the car. Wait for the payment to clear and for the finance company to tell the owner that it had done.

I did some DD on the seller who was known by the local dealer of the marque and it all turned out ok. However it turned out that despite my best DD, the seller didn't live at the address where the car was registered and where the finance co had his address as he had moved. So if I have paid off his finance and he'd done a runner with the car, I would have been stuck. it struck me as a relatively easy scam to do if you were doing a runner.

Bert

[piker]

I have done this on 2 occasions in the past me being the seller of a vehicle with outstanding finance on it. First of all I made it clear to the buyer who responded to my ad and sounded genuine that it had finance on it so we all knew where we stood. I imagine any buyer would check the car out anyway for any finance company interest in said vehicle. I never had a problem as long as I was honest and the buyer seemed honest, but do vaguely recall having the buyer sat with me in my dining room paying me first then me paying the finance company over the phone also all done within 30 mins of starting the transaction etc. I always finance my cars via Toyota Finance and they are very good at such transactions.
Once again I have to emphasis it is all done on trust and making balance judgements on folk, hope that helps.