Outstanding finance on motorhome (1 Viewer)

[Miggs]

Hi,

I've paid a deposit of £1000 for an ex-rental motorhome from a hire company.
I have done a HPI check and the results indicate outstanding finance.
Probably a no-brainer, but do I insist that is cleared prior to collection and be shown proof to that effect?

Thanks

 

[Landy Andy]

Yes. Must be cleared before you pay, or take it away. Otherwise you aren’t buying it.

 

[lorger]

I would want proof from the finance company rather than from the dealer, the dealer could easily set it up so you can call the finance company for proof it's paid off.

 

[Miggs]

The company has just responded and is telling me they will transfer funds to the finance company once I have paid and send me a copy of the release form a few days later.

That does NOT sit well with me. What if they don't?

 

[Lenny HB]

It's illegal to sell a vehicle with outstanding finance on it. You need to make sure irs cleared before parting with any money as until it is cleared the finance company own the vehicle.

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[Phill D]

The company has just responded and is telling me they will transfer funds to the finance company once I have paid and send me a copy of the release form a few days later.

That does NOT sit well with me. What if they don't?

They clearly don’t have the money available what if when you pay them the money is gobbled up by other debts on their account.
Your motorhome will not be released from its finance.

 

[Orion]

Your motorhome will not be released from its finance.

It won’t be his motorhome though!

Get the deposit back and walk away from it.

 

[pagey]

Please state the dealer

 

[Phill D]

The only other way if you really want the vehicle”
is to be given access to the finance detail and you deal with the finance company directly. Any balance going to the dealership.

 

[Basildog]

It's illegal to sell a vehicle with outstanding finance on it. You need to make sure irs cleared before parting with any money as until it is cleared the finance company own the vehicle.

Definitely not illegal as I have bought and sold vehicles / plant on finance .
Finance companies normally prefer to be paid direct by the purchaser but I have also sold a couple with permission from them and paid the settlement figure,
Personally I would rather pay the finance company their settlement figure and the remainder to the seller / company, safer for the purchaser .

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[Jimbohorlicks]

Hope you have paid the deposit with a credit card .
Don't pay the rest until you know its cear of finance or better still pay off the finance company yourself and then the dealer the balance.
It's all seems a very sticky deal whichever way.

 

[pagey]

When I bought mine I insisted on a clear hpi report but if its a chattel finance it won't show up on hpi

 

[Miggs]

I have spoken to the Finance company and they appear to have dealt with this company for years and they will take payment on the day so all seems well again.....I think!

 

[Lenny HB]

Definitely not illegal as I have bought and sold vehicles / plant on finance .
Finance companies normally prefer to be paid direct by the purchaser but I have also sold a couple with permission from them and paid the settlement figure,
Personally I would rather pay the finance company their settlement figure and the remainder to the seller / company, safer for the purchaser .

It is illegal as you are not the owner, the finance company is the owner.

 

[MichaelT]

It is illegal as you are not the owner, the finance company is the owner.

I have sold cars with HP on, part exchange and dealer paid finance company off so can't be illegal?

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[Lenny HB]

I have sold cars with HP on, part exchange and dealer paid finance company off so can't be illegal?

It is illegal selling a vehicle with outstanding finance is classed as fraud, plenty of information online about it.

 

[PP Bear]

My van had outstanding finance against it. I paid the finance company directly and the remainder to the seller, worked for me.

I would most definitely not have trusted anyone to take my money in that way. Chat to the seller and ask for a settlement fee and deduct it from the price, that way you’ll sleep a lot better over it all.

 

[Soycd]

Personally I would rather pay the finance company their settlement figure and the remainder to the seller / company, safer for the purchaser .

I agree. Interestingly when I bought my ex-rentals in Germany I seem to remember a piece of paper saying there was no finance outstanding.

 

[Harrogate motorhomer]

You are a private individual so would not be liable for any outstanding finance unless it was one of the chattel mortgages favoured by some hire companies but it doesn’t sound like it. I was in the motor trade for over 40 years & always insisted on a clearance letter as I would have been liable as deemed to be a professional. Thing that always surprised me was multi million pound companies that needed my money first to clear their debt.

 

[Minxy]

The company has just responded and is telling me they will transfer funds to the finance company once I have paid and send me a copy of the release form a few days later.

That does NOT sit well with me. What if they don't?

I wouldn't do that either.

The only other way if you really want the vehicle”
is to be given access to the finance detail and you deal with the finance company directly. Any balance going to the dealership.

Yup, pay it off direct to the finance company at the same time that you take possession of the MH and pay the balance to the dealer.

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[bigtwin]

I have sold cars with HP on, part exchange and dealer paid finance company off so can't be illegal?

Your logic is flawed; I’ve exceeded 70mph on the motorway so it can’t be illegal, can it?

Ian

 

[Badknee]

Can I suggest you pay the finance company the balance and the seller the rest.
Me, I’d walk away.

 

[Aspenshaw]

Here's a quote from AutoTrader: "Selling a car with outstanding finance without telling the buyer is illegal. Until the finance is settled (i.e. until you reach the end of the finance term), the car is still owned by the finance company, so it is not yours to sell."Broken Link Removed

There are numerous articles which support the Auto Trader comment. It seems the seller may not have been keen on telling you about the outstanding finance. However, should all parties agree to the transaction with full knowledge, I would guess it's not illegal.

Personally, whether it is legal or not, there are enough cases highlighted on motorhome forums warning such deals can be fraught with risk as Miggs suggests.

 

[SpeedyDux]

Paying the full price to the dealer? Your risk. Your decision.

You wouldn't complete the purchase of a house with an outstanding mortgage, unless your solicitor gets a written undertaking from the vendor's solicitor to redeem all mortgages on the property following completion. That is standard practice, because if a solicitor breaches their undertaking, that is extremely serious and potentially career-ending. You won't get that degree of protection when paying a dealer and relying on a verbal assurance that the dealer will settle the outstanding finance. Maybe sometime, maybe never. What if the dealer goes bust. Discover Leisure (a big MH and caravan dealership) went into administration right in the middle of the October 2011 NEC show! I was there, and saw their stand before it was closed. It must have been terrible for customers who had already placed orders and paid deposits. And their staff who would have been made redundant mid-way through the Show.

 

[Wabs]

It may be a stocking loan with a finance house

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[Miggs]

It may be a stocking loan with a finance house

Yes, it was described as a stock agreement, so pretty sure there is no skullduggery intended.......hopefully lol!

 

[Derbyshire wanderer]

The finance company own a percentage and the seller owns what’s left after paying the finance company.
The only sure way to buy it is to pay each what is owed directly as this ensures that those with legal title get paid on completion of the sale and leaves no one any room to scupper the exchange of title.

 

[TOAD on Tour]

as somebody has already mentioned and I have done the same before; at the time of paying, I’ve settled the outstanding finance with the finance company and then paid the remaining balance to the seller. I wouldn’t be over concerned about it as long as you can do it that way.

 

[Wabs]

Most car dealers have a stocking agreement, it’s very common, I wouldn’t be too worried about it.

 

[Jimbohorlicks]

I have spoken to the Finance company and they appear to have dealt with this company for years and they will take payment on the day so all seems well again.....I think!

Offer to pay the finance company and the dealer on the same day. Separately.