Buying a used car... In need of advice!

NM_Shooter · April 23, 2012, 03:08:30 PM

OK... I am coming to the well of folks who give the best advice.

I'm considering buying a used car from out of state... there is a lien on the title, and I suspect that it is held by someone out of town. Perhaps brokered by the car dealer. I don't know yet and am trying to find this out.

I've never purchased a vehicle where the owner didn't have a title to immediately hand me, so i am a bit nervous.

I had hoped that it was held by a local bank. We'd get the payoff amount, have my bank cut her bank a check, go and pay it off, and get the title released. Cut the owner an equity check, and be done.

If this lienholder is not local to the current owner, what is the best way to do this?

peternap · April 23, 2012, 03:49:29 PM

Find out who the lienholder is.

Contact them and ask for a payoff as of a certain date. Ask your DMV for the procedure for releasing the title and if additional paperwork is needed.

Be careful!

April 23, 2012, 05:20:18 PM

Thanks.

I think I am going to have to pass on this car, as much as I hate to.

Turns out the title is indeed held out of town. To complicate matters, the title is in the name of the woman that I am buying it from, as well as her ex-husband, who no longer lives with her.

Too much risk for me. I could not guarantee that I would ever see that title.

Bob S. · April 23, 2012, 05:36:28 PM

Sounds to me like you are getting smart!!!

NM_Shooter · April 23, 2012, 07:11:47 PM

Quote from: Bob S. on April 23, 2012, 05:36:28 PM
Sounds to me like you are getting smart!!!

Unlikely

April 23, 2012, 07:28:54 PM

.... at least you are wary...

NM_Shooter · April 23, 2012, 09:30:47 PM

Yeah... I am the suspicious type.

I'm considering seeing if the buyer would consider setting up a hold-back sort of arrangement. The car is ~$16k, and worth $17.5k. I write the check to the lienholder, get a bill of sale and the vehicle, and I hold back $2k. When she delivers the title, I mail the $2k, or we meet halfway between us or similar. This way I have $2k of funds to play with if I have to chase her down or go to court to get the title.

Probably not worth the risk, but I have been shopping for this make, model, and feature set for awhile, and everything is selling above book.

Native_NM · April 23, 2012, 11:31:45 PM

It depends on who has the title. It might not be as hard as you think. We bought a truck (cash) from a gal here in Abq. The credit union she financed through kept the titles locally. We had a cashier check for the entire amount. They deposited it into her account, drafted the payoff, and released the title all at the same time. This was a local credit union.

First thing is to find out of the title is held AND or OR . If it is held "AND" (joint), you need both signatures to release. If it is held OR, she can sell individually. I'd call the bank that holds the note and see what they can offer in terms of a short-term escrow service.

MountainDon · April 24, 2012, 12:02:18 AM

Quote from: Native_NM on April 23, 2012, 11:31:45 PM
AND or OR .

That is a great point! We ran into a problem with a potential purchase because the title of the seller was AND, and one of the parties was in an out of state jail. We let that one go.

April 24, 2012, 04:13:14 PM

Native NM had a good idea about escrow, but I just called the owner of the vehicle, and she is upside down on the car. The value of the vehicle is less than she owes.

I could see working out an escrow arrangement if she owed less than the value of the vehicle, but no way will it work otherwise. And I suspect that she does not have the financial means to pay it down to a point that this makes sense.

Crap.