YAUCT: Buying a used car from a private seller that hasn't been paid off yet

[kitkit201]

I am currently in negociation with the seller. Currently the seller has about $10k left to pay off the car to the Toyota Financial and hes looking to sell it for around that much. (Basically, I'm taking payments over it)

Anyways, as a buyer, before giving him my deposit for the car, what should my written receipt for the seller say?

Not sure what the proper procedure is in a sale like this, but some advice would be much appreciated. How to proceed?

Thanks

 

[FoBoT]

be careful
the title has a lien, correct??

http://articles.moneycentral.msn.com/Sa...ar/HowToSellaCarYouDontOwn.aspx?page=2

 

[Kaieye]

Don't do it. Do not leave a deposit. Just walk away unless you want to wait until the seller has the title in his hands...

 

[flot]

Originally posted by: kitkit201
I am currently in negociation with the seller. Currently the seller has about $10k left to pay off the car to the Toyota Financial and hes looking to sell it for around that much. (Basically, I'm taking payments over it)

I was just in the same situation as the seller and at least here in FL I couldn't find a good answer to it. Basically the buyer was going to have to "just trust me" that I would take his money and pay off the car. Since that didn't make much sense to either of us, I ended up paying off the car, spending 20 minutes every day on the phone with the bank for a week trying to get them to overnight me the title, etc. The only reason that worked was because I could afford to pay the car off, I just hadn't gotten around to it. If the seller can't afford to actually pay it off, he'll have to take your money and you'll have to hope he sends you the title.

If either of the banks you are dealing with (preferably the sellers...) are local, that makes life MUCH easier in at least there is someone else you can physically deal with. If Toyota financial owns it, you MIGHT have some luck getting in touch with the finance people at a Toyota dealership, but not sure. Are you intending to pay cash for the car or finance it yourself? If you are financing it yourself, again, there's another wrinkle to deal with.

 

[kitkit201]

Originally posted by: flot

Originally posted by: kitkit201
I am currently in negociation with the seller. Currently the seller has about $10k left to pay off the car to the Toyota Financial and hes looking to sell it for around that much. (Basically, I'm taking payments over it)

Are you intending to pay cash for the car or finance it yourself? If you are financing it yourself, again, there's another wrinkle to deal with.

I was intending of paying cash for it (but reading the last link, i would do a certified check from a bank).

 

[flot]

Originally posted by: Kaieye
Don't do it. Do not leave a deposit. Just walk away unless you want to wait until the seller has the title in his hands...

While I agree this is "good advice" for a buyer from a financial risk standpoint, it is not reasonable for most people who are selling/buying relatively new cars. If you owe $10k-20k on a car you probably don't have that just lying around to pay it off in the hopes that someone buys it.

Edit: Also, depending on HIS loan, you may in fact be able to "take over payments" on it. Many, but not all loans, forbid that - but he should check his contract with toyota financial.

 

[Billzie7718]

If you are going to be making payments, I assume you will be getting a loan. If so, then create a bill-of-sale (easy to find examples online) and give him a Cashier's Check for the car. Then go with him to pay it off at his bank or loan center. He can use the Cashier's Check you gave him and sign it over to pay off the car. Use a Cashier's Check because it provides tracking by the bank and can be traced. He gives you the car. If he doesn't send you the title when he gets it, you can request it from the state using the Cashier's Check receipt and Bill-of-Sale as proof-of-purchase.

 

[kitkit201]

Originally posted by: Billzie7718
If you are going to be making payments, I assume you will be getting a loan. If so, then create a bill-of-sale (easy to find examples online) and give him a Cashier's Check for the car. Then go with him to pay it off at his bank or loan center. He can use the Cashier's Check you gave him and sign it over to pay off the car. Use a Cashier's Check because it provides tracking by the bank and can be traced. He gives you the car. If he doesn't send you the title when he gets it, you can request it from the state using the Cashier's Check receipt and Bill-of-Sale as proof-of-purchase.

Good advice on if I am making payments, but what if I am not and I want to pay it all out at once. Interest rates are at 5.99% or higher and it doesn't make financial sense to take a loan when I have the full amount with me does it?

~W

 

[smack Down]

Originally posted by: kitkit201

Originally posted by: Billzie7718
If you are going to be making payments, I assume you will be getting a loan. If so, then create a bill-of-sale (easy to find examples online) and give him a Cashier's Check for the car. Then go with him to pay it off at his bank or loan center. He can use the Cashier's Check you gave him and sign it over to pay off the car. Use a Cashier's Check because it provides tracking by the bank and can be traced. He gives you the car. If he doesn't send you the title when he gets it, you can request it from the state using the Cashier's Check receipt and Bill-of-Sale as proof-of-purchase.

Good advice on if I am making payments, but what if I am not and I want to pay it all out at once. Interest rates are at 5.99% or higher and it doesn't make financial sense to take a loan when I have the full amount with me does it?

~W

You do the samething. Make sure you get a bill of sale.

 

[Billzie7718]

Originally posted by: kitkit201

Originally posted by: Billzie7718
If you are going to be making payments, I assume you will be getting a loan. If so, then create a bill-of-sale (easy to find examples online) and give him a Cashier's Check for the car. Then go with him to pay it off at his bank or loan center. He can use the Cashier's Check you gave him and sign it over to pay off the car. Use a Cashier's Check because it provides tracking by the bank and can be traced. He gives you the car. If he doesn't send you the title when he gets it, you can request it from the state using the Cashier's Check receipt and Bill-of-Sale as proof-of-purchase.

Good advice on if I am making payments, but what if I am not and I want to pay it all out at once. Interest rates are at 5.99% or higher and it doesn't make financial sense to take a loan when I have the full amount with me does it?

~W

Then it I don't see the problem. Get a Bill-of-Sale. It is legally binding and excludes you from claims or demands from the current leinholder.

 

[JeffreyLebowski]

Is this a one of a kind car? Can you not find another car like it for sale that doesn't have a lien on it?

 

[thomsbrain]

just find a different car. you really don't want to deal with this. you say toyota financial is the bank he has his loan with, so i assume he has a toyota. there are no rare toyotas that anyone would still have a loan on. that means you can find another one easily.