Advice needed: uncovered hire purchase finance. (1 Viewer)

[The Returnee]

Hi all,
So I thought I'd found the ideal Moho for my planned travels around the UK when I get back.
I've had it test driven, inspected and was on the verge of sending over a deposit.
Next step, an HPI check using the Vehicle Smart app.
The Moho is with a small garage. There have been three registration plate changes: from original plate, to personal, back to original and onto another personal plate. OK, it happened.
Finance is outstanding, just recently: 24 Feb, 2017. The last plate change was 28 Feb, 2017.

I suspect that the owner, the garage man, has kind of pawned it to overcome a cash flow tightness. .

I really would like to buy the MoHo, still!

Clearly I can't waltz up and hand £55k over. I haven't told the owner that I know: he might even be a member here! Is it as simple as arranging for him (me) to pay off the hp from his asking price, before I hand over the balance? My brother tells me that it's the finance company that actually own the vehicle.

Back to Vehicle Smart. Their phone number rings until the connection is timed out, so I don't yet know how much is owed on the vehicle, but I'm going to email Vehicle Smart having paid £8.99 for their super duper check, to find out.

Advice sought, and a final question: does this happen often?

 

[Zains Pops]

I'd walk away. Tell the guy re your HPI search.
There are plenty of others out there.
55k is a lot to risk.

 

[Lenny HB]

My advice would be don't part with any cash until the HP is paid off.
If he doesn't pay it you could have the vehicle repossed not worth the risk.
I was buying a car a few years ago HPI check showed finance outstanding I told the guy I wouldn't buy until it was settled, he took out an overdraft or short term load to pay it off.

^{_{Subscribers  do not see these advertisements}}

 

[cornish boy]

As already said, dont part with a penny until you personally have had confirmation from the finance house that the debt has been settled in full or you have arranged to pay the finance house direct as part of the purchase agreement.

Mainstream Finance houses see this kind of thing everyday and are helpful and easy to deal with. Dont forget that the settement figure maybe larger than the amount owed due to early repayment charges which may mean that your purchase price is less than the amount owed.

Be prepared to walk away!

 

[The Returnee]

Thanks @Zains Pops. It's a good price and in excellent shape, so I'm prepared to deal a bit.
Thanks @Lenny HB. Thanks @cornish boy.
I'm now a little wiser because of the settlement figure being likely larger than the amount outstanding - my lack of experience is telling.
If all else is equal, then it's a matter of order of payments: him paying off the hp and showing me the papers.

Or him transferring ownership to me, as a matter of trust, me then paying off the hp and then paying him the balance.
Or, less likely, I guess, him borrowing to pay the debt and me paying the original price.

If off to email Vehicle Smart to discover the amount outstanding, if I can.

 

[GreenHell]

Thanks @Zains Pops. It's a good price and in excellent shape, so I'm prepared to deal a bit.
Thanks @Lenny HB. Thanks @cornish boy.
I'm now a little wiser because of the settlement figure being likely larger than the amount outstanding - my lack of experience is telling.
If all else is equal, then it's a matter of order of payments: him paying off the hp and showing me the papers.

Or him transferring ownership to me, as a matter of trust, me then paying off the hp and then paying him the balance.
Or, less likely, I guess, him borrowing to pay the debt and me paying the original price.

If off to email Vehicle Smart to discover the amount outstanding, if I can.

Does the Vehicle Smart check not tell you who the finance is with? I'm pretty sure HPI checks do.

I'd give the finance company a call with the reg and explain that you're looking to purchase the vehicle.

^{_{Subscribers  do not see these advertisements}}

 

[cornish boy]

If all else is equal, then it's a matter of order of payments: him paying off the hp and showing me the papers.

Personally before handing over my money I would contact the Finance house and check it has been settled in full rather than just being shown a printed bit of paper.

I admit to being cynical but sometimes desperate people will do desperate things!

The other way to deal with it is for you to take finance on the vehicle and once purchased, settle the finance within 14 days/30days. It will likely cost you an early repayment penalty unless you take out short term finance (12months or less) and run the full term. The real benefit being that your finance provider will take care of the current owners finance on your behalf as part of their due diligence to ensure they do not finance something that is already secured against another agreement. If they will not touch it, neither should you!

 

[Zepp]

I bought private I rang hp company and they told me what to do and they would contact the seller never had any come back

I made 1 payment to hp company and 1 payment to the seller

 

[DBK]

If you think the seller knows about the finance owing but hasn't told you then that would be evidence of intended fraud in my opinion.

I wouldn't touch it as if this is how he treats customers. How far do you think you are going to get if you have a major mechanical problem with it soon after purchase?

I suggest, if you are still keen on buying it, to question the seller closely about the finance to try and confirm if he knows anything about it. If he does and wasn't going to tell you voluntarily - see paragraph above.

^{_{Subscribers  do not see these advertisements}}

 

[The Returnee]

Thanks for the replies.
Yes, it does smack at fraud.
As for Vehicle Smart, it flags the fiance owing and then shows a phone number. Perhaps it's not the best. The phone rings until disconnected, ten times now, so I'm emailing for details.

 

[pyro]

I have to say that the response and advice given to the OP has been outstanding

Nothing to add to it. Unless you can be 100% satisfied, walk away and perhaps let your local trading standards office know that the information was withheld from you

 

[Frazzle]

When i bought ours paid a £1000 deposit done a HPI check found it had finance with Santander, there was a phone number so rang Santander they informed me that it enables the dealer to add to his stock once sold the dept is cleared, i asked if it was not cleared would you get the mh back off me they said very no but would not guarantee it, so when i went to collect and pay balance i asked them to do a hip check today i see them enter the details on screen and it had been paid up i even got a print out.
What i can make out a common practice to borrow money to keep there stock going, then pay off once sold.

^{_{Subscribers  do not see these advertisements}}

 

[chaser]

You say this van is £55000 yet it has been registered to three different people so how old is it and what is it, because it doesn't sound very cheap to me , must be thousands of others at that money.

 

[Just smiffy]

You say it's a good price, perhaps he wants it gone asap.... don't let the price cloud your judgement. Question him about it and if he's cagey walk away, I wouldn't worry about upsetting him for 55k...there's plenty more out there.

 

[cornish boy]

When i bought ours paid a £1000 deposit done a HPI check found it had finance with Santander, there was a phone number so rang Santander they informed me that it enables the dealer to add to his stock once sold the dept is cleared, i asked if it was not cleared would you get the mh back off me they said very no but would not guarantee it, so when i went to collect and pay balance i asked them to do a hip check today i see them enter the details on screen and it had been paid up i even got a print out.
What i can make out a common practice to borrow money to keep there stock going, then pay off once sold.

There is what is known as 'stocking plan' or 'floor plan' finance which dealers use to fund stock rather than tie up capital. As with HP/Lease agreements, a charge is placed on the asset (in this case a motorhome) and the dealer should settle the outstanding finance at the point of sale.
With Lombard, they lodge the charge with Companies House so a quick check of the selling businesses filing history will often show the charge and identify it has been settled in full although it can be a few days out of date.
All finance houses offering stocking plans that I have dealt with carry out a monthly stock check and ensure that any sold vehicles have been settled and the charges cleared. To incentivise the dealer to be truthful and sort the finance at the point of sale, the finance houses will increase future stocking plan interest rates if stock is found to be sold but the stocking plan has not been settled. It is also seen as an early indicator of cash flow issues and can effect dealers credit limits and credit availability.

In the case of the dealer acting as a broker and selling on behalf of a customer, the finance may not be declared by the private owner and the dealer unaware of it unless the dealer has carried out their own search. In my experience, most brokers rely on private owners declaring finance on the brokerage form and dont carry out their own checks.

^{_{Subscribers  do not see these advertisements}}

 

[John65]

DONT pay anything to the seller. If you do a proper HPI check or if your local garage is registered with HPI they can do it for you. It may cost a bit more but you will be told who the finance is with and a telephone number to ring and they will give you details of the outstanding amount. As has been said if you pay the seller and he doesn't pay the finance you could end up having to pay again or lose the vehicle ( depending on type of finance taken).

 

[lorger]

our first MH still had outstanding finance and the seller was upfront about it, this is how we dealt with it.

He called Black horse and gave them permission to speak to me about his accout, I called BH and got a settlement figure from them which was roughly the figure the guy thought he owed. I then turned up at his house with deposit in cash and called BH to pay off the balance with my card, all went through and both parties happy.

Not that I ever thought he was trying to scam me but when he gave me Black Horse numbers to ring I ignored them and looked them up online, you never know someoone could be at the other side taking your details.

When you phoone the seller back tell him you want to ask a few questions and ask if the van has ever been in an accident or has finance owing on it, this will tell you how honest he is

 

[The Returnee]

Again, thanks all for good, considered advice. I hadn't heard of a 'stocking plan', nor, in fact of Black Horse, which is who he has financed with. I have the policy and date so will try on line to see what I can see.

^{_{Subscribers  do not see these advertisements}}

 

[cornish boy]

Black Horse offer both stocking plans and private finance.

You said in your OP that the policy date is the 24th of Feb so I have been under the impression that it is private finance you are referring to as that seems a long time to have had a quality motorhome in stock.
Unless you know for a fact that the dealer took it into their stock (ownership) in Feb then it is more likely (as I presumed) that the dealer is in fact acting as a broker for the private owner.
I am sure you are aware that your relationship (and rights) with a 'broker' who is acting as a intermediatory between you and the seller is not the same as your relationship (or rights) with a 'dealer' who is selling a motorhome the business owns.

Buying on brokerage is more akin to buying privately than buying from a dealer. (think Estate Agent!)

I would want to fully understand the situation before spending any money.

 

[knokinonabit]

You could have my Autotrail Comanche on a 12 plate for £50,000.
No finance outstanding or anything else owing.
One owner, me, from new.
Must be a heck of a motorhome you are after.

 

[Lenny HB]

I wouldn't necessarily think of it as fraud as lot of people who take out finance don't understand the law and they think they can sell the vehicle and then pay off the loan.

Having the documents doesn't mean a lot the V5 is proof of registration NOT proof of ownership.
The present owner has the V5 in their name but the vehicle is owned by the finance company.

^{_{Subscribers  do not see these advertisements}}

 

[The Nomad]

That is a SHEDLOAD of money to risk throwing away. There are gazillions of "straight" motorhomes for sale. I'd walk away. Quickly.

 

[The Dotties]

Black Horse is part of Lloyds Banking Group.

 

[Silver-Fox]

Many years ago I bought acworks van that had finance on it through Vauxhall.
The seller told me I arranged to pay it off and drove off with the van and a receipt fro the finance company and the seller.

^{_{Subscribers  do not see these advertisements}}

 

[The Returnee]

@Smith and Sharp: the same garage/owner has switched the plates. I'll post up the Vehicle when I'm a little further along, especially if it doesn't work out, so that no one else gets caught.

 

[The Returnee]

@Silver-Fox: that's what I'm hoping for.

 

[The Returnee]

@cornish boy: ah, perhaps. He's had it a while and has used it himself. It is he who has changed the plates also, but it is a question I'll ask. Thank you.
In due course, I'll post details.

^{_{Subscribers  do not see these advertisements}}

 

[The Returnee]

Thanks all for the good advice. I will complete the circle by letting you all know the questions I asked and the van details.

I shan't be handing over any money at all, until all questions are satisfactorily answered.

Every day is a learning experience.

 

[scotzsue]

all these registration changes, i wouldn't toch it with a barge pole, especially if it is a Ford, dont forget to check the engine number against all registrations.

 

[cornish boy]

@cornish boy: ah, perhaps. He's had it a while and has used it himself. It is he who has changed the plates also, but it is a question I'll ask. Thank you.
In due course, I'll post details.

I did say I was a cynic, so...
is it his personal van he is selling privately or a company owned asset sold as part of his business?

^{_{Subscribers  do not see these advertisements}}