Selling a car with a payoff balance...UPDATE: Car is sold
12-08-2009, 04:56 PM
#1
Pro
Thread Starter
Selling a car with a payoff balance...UPDATE: Car is sold
I am getting ready to put my car up for sale. I still owe some money on it which means that I and the buyer will have to wait for the title to be released from the finance company which takes about 4 weeks or so.
What is the proper procedure/sequence of getting this transaction done in a fair and efficient way?
Collect the purchase price from the buyer, pay off the finance company and release the car and title when I receive the title? Or have the buyer pay off the loan directly to the finance company and collect the balance after the title is released?
I want to avoid paying off the car myself to get the title...I would have to break a CD and pay a penalty to do so.
What is the proper procedure/sequence of getting this transaction done in a fair and efficient way?
Collect the purchase price from the buyer, pay off the finance company and release the car and title when I receive the title? Or have the buyer pay off the loan directly to the finance company and collect the balance after the title is released?
I want to avoid paying off the car myself to get the title...I would have to break a CD and pay a penalty to do so.
Last edited by LoanWolf; 02-08-2010 at 04:51 PM.
12-08-2009, 05:01 PM
#2
Agent Orange
Rennlist Member
Rennlist Member
4 weeks seems like a long time. I haven't done this in a while, but IIRC in my case it was only several days. What is the law in CA - the title comes with a lien on it and you hold on to it, or is it sent directly to the lien holder?
If you have the title, all you need is a notarized letter from the lien holder stating that the lien's been paid in full. They should be able to furnish such a letter in a matter of days. You can even have them overnight it to you for a fee.
But the best way is to have the car paid off before you put it up for sale. See if there are other ways of getting that done other than your CD.
If you have the title, all you need is a notarized letter from the lien holder stating that the lien's been paid in full. They should be able to furnish such a letter in a matter of days. You can even have them overnight it to you for a fee.
But the best way is to have the car paid off before you put it up for sale. See if there are other ways of getting that done other than your CD.
12-08-2009, 05:02 PM
#3
Burning Brakes
I'll make this plain and simple. Many buyers want clear titles in hand without additional worries. The car buying experience is nerve-wracking enough without title concerns. You may find buyers with no qualms about waiting but I sure would not be one of them.
12-08-2009, 05:10 PM
#4
Drifting
I bought my 1987 this way - and in Chicago long distance
wired the money for the loan balance
wired the money for difference to the seller.
at that time had a bill of sale from the owner.
The credit union handled getting me the title directly. Flew out and drove the car back with the PO plates, and the bill of sale and current insurance documentation.
Registered in Florida = paid taxes, registered car - got florida title.
wired the money for the loan balance
wired the money for difference to the seller.
at that time had a bill of sale from the owner.
The credit union handled getting me the title directly. Flew out and drove the car back with the PO plates, and the bill of sale and current insurance documentation.
Registered in Florida = paid taxes, registered car - got florida title.
12-08-2009, 05:15 PM
#5
Pro
Thread Starter
4 weeks seems like a long time. I haven't done this in a while, but IIRC in my case it was only several days. What is the law in CA - the title comes with a lien on it and you hold on to it, or is it sent directly to the lien holder?
If you have the title, all you need is a notarized letter from the lien holder stating that the lien's been paid in full. They should be able to furnish such a letter in a matter of days. You can even have them overnight it to you for a fee.
But the best way is to have the car paid off before you put it up for sale. See if there are other ways of getting that done other than your CD.
If you have the title, all you need is a notarized letter from the lien holder stating that the lien's been paid in full. They should be able to furnish such a letter in a matter of days. You can even have them overnight it to you for a fee.
But the best way is to have the car paid off before you put it up for sale. See if there are other ways of getting that done other than your CD.
The four week turn-around what they quote.
12-08-2009, 05:15 PM
#6
Pro
Thread Starter
12-08-2009, 05:18 PM
#7
Instructor
Join Date: Dec 2005
Location: CA
Posts: 245
Likes: 0
Received 0 Likes
on
0 Posts
The process is pretty simple. You are the registered owner, but the title is held by the bank. If the buyer is financing the purchase, you pretty much sign a Bill of Sales and his bank pays off the loan and gives you the difference between loan balance and sales price. If you two go over to the bank, the bank will just hand you a check and have you sign off on the sale.
If he comes with cash, most likely he will just give you the difference and keep the rest to pay the bank. I doubt anyone will hand you all of the money up front for a car that is subject to a loan/lien. Another option is to have him contact you bank in advance and make payment plans after which the bank will release the title to the buyer.
hassle? yes, but if the buyer really wants you car, that should be no problem.
If he comes with cash, most likely he will just give you the difference and keep the rest to pay the bank. I doubt anyone will hand you all of the money up front for a car that is subject to a loan/lien. Another option is to have him contact you bank in advance and make payment plans after which the bank will release the title to the buyer.
hassle? yes, but if the buyer really wants you car, that should be no problem.
Trending Topics
12-08-2009, 05:19 PM
#8
Pro
Join Date: Jul 2007
Location: Northern Virginia
Posts: 529
Likes: 0
Received 0 Likes
on
0 Posts
I bought my car from a guy who still had a lien, but he was local and vouched for by my mechanic. He drove the car to my house, parked it in my garage and took the tags. He paid off the lien and gave me a letter from the bank saying it was released. I was able to title the car using that. It took 2 days.
12-08-2009, 05:21 PM
#9
Race Car
I buy cars like this all the time.
1. Buyer cuts 2 cashier's checks one for the lien holder (remaining loan balance) and the other to the seller for the remaining balance of the sale
2. The seller produces a letter from the lien holder stating the payoff amount. This can be verified also if the buyer calls the lien holder with the account information for the payoff.
3. Most cases the lien holder has the title on hand at their office.
4. Once the lien holder receives the check and it clears the title with a lien release is sent to the buyer. the lien holder will have a form in which to fill out all the relevant information.
Not a big deal at all. I do it all the time as I deal in cars on the side. Most of all my trades or buys from individuals are handled this way. I also pay off leases in the same fashion. This is not out of the ordinary at all. If you have any questions just pop in to a local small dealer and verify the process.
Mike
1. Buyer cuts 2 cashier's checks one for the lien holder (remaining loan balance) and the other to the seller for the remaining balance of the sale
2. The seller produces a letter from the lien holder stating the payoff amount. This can be verified also if the buyer calls the lien holder with the account information for the payoff.
3. Most cases the lien holder has the title on hand at their office.
4. Once the lien holder receives the check and it clears the title with a lien release is sent to the buyer. the lien holder will have a form in which to fill out all the relevant information.
Not a big deal at all. I do it all the time as I deal in cars on the side. Most of all my trades or buys from individuals are handled this way. I also pay off leases in the same fashion. This is not out of the ordinary at all. If you have any questions just pop in to a local small dealer and verify the process.
Mike
12-08-2009, 05:24 PM
#10
Burning Brakes
You might want to see if the state offers any kind of written assurance the title is valid. It will help move th proess along.
With the current state of the Jimmy O'Bama economy, buyers are more careful know than ever.
I was ready to buy a piece of large piece of undeveloped real estate recently and found out through a title search that it was liened to the hilt, though the owner swore he owned it free and clear.
12-08-2009, 05:29 PM
#11
Race Car
Mike
12-08-2009, 05:40 PM
#12
Burning Brakes
Since then, I don't trust anyone when it comes to money transactions.
12-08-2009, 06:12 PM
#13
Pro
Thread Starter
I buy cars like this all the time.
1. Buyer cuts 2 cashier's checks one for the lien holder (remaining loan balance) and the other to the seller for the remaining balance of the sale
2. The seller produces a letter from the lien holder stating the payoff amount. This can be verified also if the buyer calls the lien holder with the account information for the payoff.
3. Most cases the lien holder has the title on hand at their office.
4. Once the lien holder receives the check and it clears the title with a lien release is sent to the buyer. the lien holder will have a form in which to fill out all the relevant information.
Not a big deal at all. I do it all the time as I deal in cars on the side. Most of all my trades or buys from individuals are handled this way. I also pay off leases in the same fashion. This is not out of the ordinary at all. If you have any questions just pop in to a local small dealer and verify the process.
Mike
1. Buyer cuts 2 cashier's checks one for the lien holder (remaining loan balance) and the other to the seller for the remaining balance of the sale
2. The seller produces a letter from the lien holder stating the payoff amount. This can be verified also if the buyer calls the lien holder with the account information for the payoff.
3. Most cases the lien holder has the title on hand at their office.
4. Once the lien holder receives the check and it clears the title with a lien release is sent to the buyer. the lien holder will have a form in which to fill out all the relevant information.
Not a big deal at all. I do it all the time as I deal in cars on the side. Most of all my trades or buys from individuals are handled this way. I also pay off leases in the same fashion. This is not out of the ordinary at all. If you have any questions just pop in to a local small dealer and verify the process.
Mike
That is a good procedure and I wanted to handle it that way until Capital One told me about the four weeks until they release the title! Do you have any experience with Capital One in this regard?
12-08-2009, 06:49 PM
#14
Only comment that I have is that Capital One is Satanic and I wouldn't be surprised if they make it as difficult as you can possibly imagine to process the transaction.
Sorry, bad history / bad mood.
(Use a CU next time. Like: http://penfed.org)
Sorry, bad history / bad mood.
(Use a CU next time. Like: http://penfed.org)
12-08-2009, 06:51 PM
#15
Race Car
I have used Captal 1 before and this seems to be the time frame I have gotten the title earlier(2-3 weeks), but 4 weeks has happened. It is a paperwork issue with these guys. They are huge and it takes them longer to do things. Are you dealing with the facility in Texas? They will have all the forms to fill out and the buyer can even call and see the process of the title. That's what I do. Just make sure to UPS overnight the cashiers check to them so you can verify delivery. I wish they would move faster, but you are on their time. You can follow up on the progress like I said before just make sure you keep the loan number that's what they go by.
Mike
Mike