advice needed on that final money handover.......

[21TVR]

Ok, so you've picked the shinning beastie that you want to buy, you've kicked the tires and looked under the floor mats, and well stood there and made noises....agreed the money, done the HPI check and all that

now you have to part with the money. 'Bye the way, it's got a finance contract still running on it'
'Yes i spotted that on the HPI'
'I've called the finance company and they've told me the settlement figure is £10 so if you pay that direct to them we're sorted'

Is this the case? Who really owns a car once the V5 is signed off ? What's the story on oustanding finance that wasn't even yours (HP that is) ?

Anybody know ? should I address this to the uniformed members of this Forum ?

it's a goodie!

thanks people

SP

If you pick up a motor from a private individual, sign the V5 in the right boxes, agree to pay of the finance at the money you've been told - what happens if the finance company turn round and say "You owe us more money" ok so you go back to the seller with the boys, but he/she rightly says "not my problem, I sold it to you for £10

[SGirl]

IIRC if there's finance outstanding on a car the finance company has title to it, even if the V5 is in your name. So if they decide to repossess because the previous owner has defaulted on payment, you won't have a legal leg to stand on.

I might be wrong, though!! I'm no expert. I just have vague recollections of discussing something similar a while back...

Edited to add: Here we are. From a FAQ at www.caerphilly.gov.uk/living/tradingstandards/faqfinancialservices.htm#q1

Q.
I bought a car a few months ago from a private individual/car trader and I've just found out that it's still the subject of a hire purchase/conditional sale agreement. The finance company says that the car belongs to them. Is this true?

A.
The Hire Purchase Act (now incorporated into the Consumer Credit Act) states that the first 'innocent private purchaser' of the vehicle gets 'good title' or ownership. Innocent purchaser means someone who did not and could not reasonably have been expected to know about the outstanding hire purchase/conditional sale agreement. The finance company would not be able to repossess the car from you and should pursue the person who took out the agreement.

If you had known or had suspicions about any agreement, and didn't ask any questions, you would not be considered to be an innocent purchaser - ownership would not pass to you and the car could then be repossessed.

You should always consider carrying out checks before you buy a car. There are agencies, such as HPI, who will search their databases and let you know whether the car has a finance agreement registered against it, or whether it has been declared an insurance write-off, and also whether it has been reported stolen. Incidentally, stolen cars (in common with other stolen goods) will always remain the property of the person from whom they were stolen.

>> Edited by SGirl on Friday 10th January 19:55

[shpub]

The finance company own the car. They don't mind a 3rd party paying the debt to ensure that title is transferred. It stops the seller from running away without clearing the debt and it menas that the buyer knows that the money has been paid. when you collect the car, seller gives you the V5. Even if he didn't title is still with you as you paid the finance company.

Did this when I bought my current Griff and it worked pretty well. everybody wins as they say.

Steve

[21TVR]

yeah, ok this is good, but your told the oustanding amount owed to the finance company by the seller

a month down the line you find out there should have been a balloon payment or some other such scorpion

what then?

(well done so far by the way!)

[pies]

i would not even contemplate buying a car with outstanding hp on it,it can get very messy.Friend of mine bought one then found out the lender of the money was trying to get the car.Story unfolded the seller was not the origional buyer.It all got very messy.Best bet go look at some other cars,after all if its too good to be true it probabaly is

[Cerbnut]

I did the very same a couple of months ago. I had the seller send me the written statement of settlement from the lender, which I then verified over the phone with the lender.

The guy who was selling seemed more concerned about me doing a runner with the car and not settling up, so I'm afraid it works both ways, as always when buying a car...

[shpub]

21TVR said: yeah, ok this is good, but your told the oustanding amount owed to the finance company by the seller

a month down the line you find out there should have been a balloon payment or some other such scorpion

what then?

(well done so far by the way!)

Good point. In my case, the buyer showed me the settlement statement and I confirmed with the Finance people. The more you check the better you will be.