Selling a car with outstanding finance?
25 April 2001, 09:36 AM
#2
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Yes, but you should give the new owner a signed letter stating that you will use the proceeds of the sale to settle any outstanding finance.
You are not legally required to do this, its merely a peace of mind thing for the new owner.
Until you settle the finance the car is owned by the finance company (unless you have a personal loan of course).
If you did not settle the finance, and stopped making payments, then the finance company can legally reposses the car. I'm sure that you wouldn't do that of course.
You are not legally required to do this, its merely a peace of mind thing for the new owner.
Until you settle the finance the car is owned by the finance company (unless you have a personal loan of course).
If you did not settle the finance, and stopped making payments, then the finance company can legally reposses the car. I'm sure that you wouldn't do that of course.
25 April 2001, 09:59 AM
#3
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I'd check with the finance company if I were you. If it's under a hire purchase agreement, the car isn't legally yours to sell until it's paid off in full.
You could possibly take two separate cheques from the buyer - one payable to the finance company for the outstanding balance, and a second one payable to you for the remainder. That could certainly give the buyer some peace of mind.
Bear in mind also that if the buyer does an HPI check, they will find out that the car has outstanding finance on it. It's a nasty surprise for them if you haven't already owned up to that fact (something I know from personal experience!), so be upfront about it.
Ultimately you may have to take out a short-term unsecured loan to pay off the HP. A credit card cheque could be useful here - although the interest rate could be high, you can pay it straight back as soon as you have the money from your buyer.
Be careful out there...
Andy.
You could possibly take two separate cheques from the buyer - one payable to the finance company for the outstanding balance, and a second one payable to you for the remainder. That could certainly give the buyer some peace of mind.
Bear in mind also that if the buyer does an HPI check, they will find out that the car has outstanding finance on it. It's a nasty surprise for them if you haven't already owned up to that fact (something I know from personal experience!), so be upfront about it.
Ultimately you may have to take out a short-term unsecured loan to pay off the HP. A credit card cheque could be useful here - although the interest rate could be high, you can pay it straight back as soon as you have the money from your buyer.
Be careful out there...
Andy.
25 April 2001, 05:34 PM
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When I bought a car like this (Civic VTi)
Owner was upfront about it. I went with them to finance company - gave them a cheque for outstanding balance - saw the owner and finance company sign the right forms relinqueshing ownership, then gave the owner the cheque for the balance and off I went ....
[This message has been edited by dsmith (edited 25 April 2001).]
Owner was upfront about it. I went with them to finance company - gave them a cheque for outstanding balance - saw the owner and finance company sign the right forms relinqueshing ownership, then gave the owner the cheque for the balance and off I went ....
[This message has been edited by dsmith (edited 25 April 2001).]
25 April 2001, 09:02 PM
#5
Yes,
the finance company can send you a letter detailing the finance agreement with outstanding amount detailed on it.
Show this to buyer and get them to sign a cheque to finance company, not you.
Best for both parties to proceed after cheque has cleared.
Nick
the finance company can send you a letter detailing the finance agreement with outstanding amount detailed on it.
Show this to buyer and get them to sign a cheque to finance company, not you.
Best for both parties to proceed after cheque has cleared.
Nick
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