Logbook loans and the law?

[Spencer11]

Hi. My wife and i recently purchased a car unknowing to us it was on HPI alert for what is known as a 'logbook loan'. As it appaears the loan against the car was taken out in january and we purchased the car in february. Normally we buy a new car on average of once every 2 years and this i can say has never happened before.
We only HPI'd the car as our mechanic had pointed out some repaired damage to the front passenger side which turned out to not be stated on the HPI report we got.

Were both at a loss at what we can do in regards to this. Is the car legally ours even though we have the logbook and its in my wifes name? We have contacted the finance company who refuse to discuss anything with us as its against the data protection act. We have also contacted the previous keeper who claims he never took out such a loan against the car.

Any advice would be appreciated on steps we should and could take. Possibly maybe someone else has had some experience with something similiar?
We would just like to know where we stand with this and how the law applies. TIA.

Edited by Spencer11 on Wednesday 26th March 23:20

[ganglandboss]

The legal owner and the registered keeper are not always the same thing so having the logbook does not neccesarily mean it is leagally yours.

Was it a private sale or did you buy from a dealer?

Edited by ganglandboss on Wednesday 26th March 23:37

[Spencer11]

It was private. I know that is sometimes the case with log books as you stated.

[ypauly]

well if a previous owner had sold a car that had a finance agreement attached i would be fairly certain that is a crime possibly deception but you will need the police to know for sure
speak to them see if they can help

[^Slider^]

It would only be a deception if the OP asked if there was any finance or loan secured on the car.

Then it maybe fraud by false representation but i stand to be corrected on that.

Technically if the loan is secured on the vehicle then the finance co will own the vehicle and if the seller was to default on the loan then they would take the car back and then its civil claim time.

Could you not contact the loan company and find out the score with them? Maybe the seller has paid off the loan with the sale of the vehicle?

[paoloh]

I hate to say this but you don't own the car!

On HPI there will be a number for logbook loans and a ref number, the previous owner may have used your money to pay them off and LB loans are just being slow at updating HPI.

Good luck.

[deviant]

Yeah it might just have taken a few days for the loan to clear.

Is it possible there is a case of identity theft going on? If the previous owners ID has been stolen is it possible the thief secured a loan against the car?

[paoloh]

deviant said:

Yeah it might just have taken a few days for the loan to clear.

Is it possible there is a case of identity theft going on? If the previous owners ID has been stolen is it possible the thief secured a loan against the car?

Not really as you need the vehicles paperwork too.

A lot of hassle for a few quid.

[supermono]

Maybe you've been ripped off? Person advertises a car for sale, you do your due dilligence checks with HPI and find it checks out so buy it. Between the sale agreed and collection, a logbook loan is taken out.

So they get their money twice and because you did your check earlier you don't know about the loan.

Question though: why did you think the second HPI check would come up with anything different regarding the damage your mechanic noticed? What were the dates of the first HPI check and what date did you take ownership of the car?

SM

[streaky]

paoloh said:

deviant said:

Yeah it might just have taken a few days for the loan to clear.

Is it possible there is a case of identity theft going on? If the previous owners ID has been stolen is it possible the thief secured a loan against the car?

Not really as you need the vehicles paperwork too.

A lot of hassle for a few quid.

It's not that difficult to obtain copies of the paperwork. I've seen complex frauds and other scams that were only ever going to net small potatoes - Streaky

[Roo.]

supermono said:

Question though: why did you think the second HPI check would come up with anything different regarding the damage your mechanic noticed? What were the dates of the first HPI check and what date did you take ownership of the car?

SM

I read the OP as that they didn't HPI it until after they'd bought it, and even then only because they mechanic they use found some damage repairs.

[supermono]

Spencer11 said:

We only HPI'd the car as our mechanic had pointed out some repaired damage to the front passenger side which turned out to not be stated on the HPI report we got.

So some clarification needed. How many HPIs?

I'm interested in this because it sounds like a scam and I'd like to know how to avoid it myself. Did the seller give you an HPI? You say "HPI report we got" as if you had to get a second one...

SM

[Spencer11]

Just to clarify we had 1 hpi check which we carried out after owning the car for a month or so. The seller did not indicate the car was on finance or had been involved in any sort of accidents and did not offer an hpi report.
I have spoken to the finance company today who took the sellers details and mine and said that he has obviously committed fraud as he has has no right to sell the car unless he pays off the loan he took out against the car which they confirm he has not.
As a long shot i also contacted the office of fair trading and they said it was not the first person this had happened to and i would certainly not be the last. They advised that i contact the finance company and try and get them to settle the loan with the seller which i have done so far.

I await their phone call but until then i am still confused and quite stressed to say the least.

Once i receive more information i will post it here.

[Vesuvius 996]

Spencer11 said:

Just to clarify we had 1 hpi check which we carried out after owning the car for a month or so. The seller did not indicate the car was on finance or had been involved in any sort of accidents and did not offer an hpi report.
I have spoken to the finance company today who took the sellers details and mine and said that he has obviously committed fraud as he has has no right to sell the car unless he pays off the loan he took out against the car which they confirm he has not.
As a long shot i also contacted the office of fair trading and they said it was not the first person this had happened to and i would certainly not be the last. They advised that i contact the finance company and try and get them to settle the loan with the seller which i have done so far.

I await their phone call but until then i am still confused and quite stressed to say the least.

Once i receive more information i will post it here.

You're screwed.

You say the owner didn't mention any finance or accident and didn't offer an HPI check...... Of course he bl00dy well didn't.

You've effectively bought a car with finance outstanding. The finance company have a charge over it, the loan was secured against the car.


Sorry to say it but you should have HPI'd it BEFORE you bought it.

Call the CAB and see what they say or engage a solicitor.


You sure don't own the car.

Edited by Vesuvius 996 on Thursday 27th March 11:10

[mcflurry]

You can only pass ownership title if you have it yourself.

In this case the car belongs to Logbook loans as collateral for a loan. Until it is cleared the seller had no title to pass on.

Caveat emptor

[Vesuvius 996]

mcflurry said:

You can only pass ownership title if you have it yourself.

In this case the car belongs to Logbook loans as collateral for a loan. Until it is cleared the seller had no title to pass on.

Done up like a kipper

Edited for accuracy.

[Spencer11]

Good news, i spoke with someone at the finance company who says their area rep is sorting this out for us and it should be tied up by the beginning of next week with the car finance free.
Fingers crossed till then again i shall keep you informed of what happens.