Car Purchased with Outstanding Financing Unknowingly

Amik

A friend purchased a second-hand car with cash at the beginning of the year. All was fine until recently when a rep from a financing company knocked on his door.

The car's previous owner had been financing the car and sold it to my friend before fully paying it off.

The original owner has since disappeared. Will my friend lose the car to the financing company? Does he have any rights?

There seems to be a Hire Purchase Act that protects buyers in such situations in the UK. Is there an equivalent here in Ireland?

L1011

Was it bought from a dealer or privately? I would assume privately from the description.

There are no specific legal protections here and there are close to no consumer rights in a private sale.

tea and coffee

Afaik, the car can be seized by the finance company. It's basically "not their problem " that your friend isn't the person who owes it. They have prior claim to the asset.

Amik

Thank you for the fast replies! I've been Googling in the meantime and getting the same results as what you both wrote.

There seem to be lots of people getting into this situation as of late.

alan partridge aha

How much is the outstanding finance?

pilly

Amik wrote:

There seem to be lots of people getting into this situation as of late.

I don't know why as it only costs 30 euro to do a check.

Amik

Long shot but would the insurance the friend took out on the car compensate him in this situation?

taylor3

Same **** happened my husband years ago. His brother (yeah I know) sold him his car as he was going abroad. My husband kept it for a while and then sold it on to someone else. One night the new owner knocked on our door absolutely fuming as a financial company wanted to seize it from him as apparently there was money owed on it. My husband and I were totally dumbfounded and had to bring him in and calm him down. New owner was threatening us en'all. It was awful we were all F**ked over by his so called brother. Next morning after loads of phone calls my husband got the money together to pay off the balance owed. When he eventually got thru to his brother he played dumb and claimed that he told my husband when buying it from him that there was money owed on it and not to sell it on. Utter bullcrap and a downright lie. Anyways it was sorted in the end but not a nice experience for my husband and I and the man that had bought it from my husband. Never again

Atlantic Dawn

People buying cars for tens of thousands yet unwilling to bankroll a €25 history check, the mind boggles, scams only exist because people are not willing to do basic checks.

JohnC.

I don't think it's unwillingness. More like an awful lot of people are simply unaware of things like this.

coylemj

Amik wrote: »

Long shot but would the insurance the friend took out on the car compensate him in this situation?

Not a chance.

This almost happened me a few years ago. It was a Merc. E200, the exact colour and trim that I was looking for and it was in very good order. Price wasn't stupid, it was a fair price for a private sale but I didn't like the the fellow I met in a pub car park in south Dublin. He said that he was a local taxi driver and was selling the car 'for a client', a guy who worked for a multinational IT firm and who was currently out of the country. That was the excuse he used when I asked to see the registration cert. so I said I'd think about it and get back to him.

Went straight home and spent €25 on one of the history check websites where I discovered that there was a 'finance outstanding' flag against the car - money well spent! I reported it to donedeal.ie where the car was being advertised but they basically didn't want to know.

Caveat Emptor

ED E

coylemj wrote: »

I reported it to donedeal.ie where the car was being advertised but they basically didn't want to know.

Says a lot that their head of fraud is an ex-gard.

pilly

taylor3 wrote: »

Same **** happened my husband years ago. His brother (yeah I know) sold him his car as he was going abroad. My husband kept it for a while and then sold it on to someone else. One night the new owner knocked on our door absolutely fuming as a financial company wanted to seize it from him as apparently there was money owed on it. My husband and I were totally dumbfounded and had to bring him in and calm him down. New owner was threatening us en'all. It was awful we were all F**ked over by his so called brother. Next morning after loads of phone calls my husband got the money together to pay off the balance owed. When he eventually got thru to his brother he played dumb and claimed that he told my husband when buying it from him that there was money owed on it and not to sell it on. Utter bullcrap and a downright lie. Anyways it was sorted in the end but not a nice experience for my husband and I and the man that had bought it from my husband. Never again

Nice brother!!

amtc

True story....same thing happened with my dad and his brother. Not surprisingly they fell out. Last we heard he was in prison for bigamy. I found him recently on Facebook (am friends with my cousin and came up as suggestion) and his age was less than mine.

Anyway on the original story I was just wondering if garages search for history? My friend is buying a second hand car from one and she asked the sales man if they did and he didn't know.

daheff

amtc wrote: »

Anyway on the original story I was just wondering if garages search for history? My friend is buying a second hand car from one and she asked the sales man if they did and he didn't know.

I'd be telling the garage to provide clarification on this (at their expense)-and in writing if you are to purchase the car.


find it hard to believe a reputable dealer would not know if they do this check.

nosilver

amtc wrote: »

Anyway on the original story I was just wondering if garages search for history? My friend is buying a second hand car from one and she asked the sales man if they did and he didn't know.

Buying from a garage gives you rights as a consumer and a garage would always check in anycase

Buying privately gives you no rights.

Fred Swanson

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Del2005

daheff wrote: »

I'd be telling the garage to provide clarification on this (at their expense)-and in writing if you are to purchase the car.


find it hard to believe a reputable dealer would not know if they do this check.

For the sake of €30 do a history check yourself. If you don't trust them for knowing the history why would you trust a history they provide, it's very easy to fake web sites.

The only place that can provide an iron clad guarantee that their is no finance owing is the finance company, anything from a garage is not going to be off use, but finding out which company has finance on a vehicle can be difficult and possibly run into data protection issues.

cruizer101

When a car is bough under finance is there anything on the reg cert to indicate to indicate the owner is the finance company and not the individual?
If they own the case surely its their name on the reg cert, or am I missing something here.

Fred Swanson

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RustyNut

ED E wrote: »

Says a lot that their head of fraud is an ex-gard.

Yea the guards are good at the oul fraud all right...

cruizer101

Fred Swanson wrote: »

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I always assumed the reg cert was proof of ownership, few more questions then if you know the answers.
Do the Dept down in Shannon keep a record then of the actual owner along with the "registered" owner?
Do the car check websites check with them if a car is on finance or how do they find out?

coylemj

I can see no reason why there isn't a publicly available website which will tell you if finance is outstanding on a car. You can type in a registration number on the NCT website and see when the NCT is due, why can't you do the same to check if finance is outstanding?

Before anyone dives in and mentions 'data protection', I cannot see any problem under that heading because at the moment you can get the information by paying money to a private company (motorcheck/cartell etc.) so there are no data protection issues involved.

Former Former

coylemj wrote: »

I can see no reason why there isn't a publicly available website which will tell you if finance is outstanding on a car. You can type in a registration number on the NCT website and see when the NCT is due, why can't you do the same to check if finance is outstanding?

Before anyone dives in and mentions 'data protection', I cannot see any problem under that heading because at the moment you can get the information by paying money to a private company (motorcheck/cartell etc.) so there are no data protection issues involved.

Who would operate such a website? It can't be the government.

pilly

coylemj wrote: »

I can see no reason why there isn't a publicly available website which will tell you if finance is outstanding on a car. You can type in a registration number on the NCT website and see when the NCT is due, why can't you do the same to check if finance is outstanding?

Before anyone dives in and mentions 'data protection', I cannot see any problem under that heading because at the moment you can get the information by paying money to a private company (motorcheck/cartell etc.) so there are no data protection issues involved.

There is!! When you run a car check it will tell you if there's finance outstanding.

Why don't people know this?

Fred Swanson

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pilly

Fred Swanson wrote: »

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Yes.

coylemj

Former Former wrote: »

Who would operate such a website? It can't be the government.

I nominate the Banking and Payments Federation Ireland, this was formed in 2014 as a result of a merger between the Irish Banking Federation (IBF) and the Irish Payment Services Organisation (IPSO).

It's in their members' interests to block or at least discourage the sale of cars with outstanding finance because their members then have to go chasing the new 'owner' with all the attendant aggravation that follows.

coylemj

pilly wrote: »

There is!! When you run a car check it will tell you if there's finance outstanding.

Why don't people know this?

I asked about a 'publicly available' (by which I meant free) website - what is the address of the website you're referring to?

In my post (which you quoted in full), I referenced the fact that the information is available for a fee from several private companies.

boombang

Out of interest, what happens when the money is owed on a UK car? Can the finance firms pursue somebody in Ireland once the car has left the UK?

Fred Swanson

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boombang

Fred Swanson wrote: »

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It's long interested me why there isn't an ongoing scam in exporting/importing cars with outstanding finance to and from Ireland/UK if this is the case.

Fred Swanson

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coylemj

Fred Swanson wrote: »

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Do I recall that the original UK registration number is recorded when you import and register a car here? So technically the car could be traced?

Fred Swanson

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boombang

Fred Swanson wrote: »

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I could well imagine, good luck on getting anything back from a car that's gone to Africa.

coylemj wrote: »

Do I recall that the original UK registration number is recorded when you import and register a car here? So technically the car could be traced?

While I imagine that a car could be traced handily enough are there sufficient protections for those who own the debt on the car to pursue a new owner in a new jurisdiction? There must be if people don't regularly go and buy cheap cars from the UK because they're turning a blind eye to outstanding finance?

cruizer101

Former Former wrote: »

Who would operate such a website? It can't be the government.

Why not, do they not keep a record of who actually owns a car?

L1011

cruizer101 wrote: »

Why not, do they not keep a record of who actually owns a car?

They have a very specific financial interest in the ownership of a car

Maintaining a DB of finance, amounts outstanding etc and ensuring its accuracy would not be cheap and serves little purpose for them

lan

The finance company should have the details of the person who originally took out the loan. Couldn't you / the guards use this to track them down for fraud?

Fred Swanson

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coylemj

L1011 wrote: »

Maintaining a DB of finance, amounts outstanding etc and ensuring its accuracy would not be cheap and serves little purpose for them

There has to be a central repository of this information. There is any number of banks and finance houses lending money on cars - they have to be storing the data in a single database for cartell and motorcheck to be able to check as fast as they do.

They have to pool the data because otherwise a person could get several loans on the same car, maintaining a central database prevents this.

I suspect that the fees collected by cartell and motorcheck are paying for the maintenance of this database, otherwise there is no reason why it couldn't be made available for free.

coylemj

coylemj wrote: »

Do I recall that the original UK registration number is recorded when you import and register a car here? So technically the car could be traced?

Answering my own question...... there is a field (J.4) 'Previous Registration Number' on registration certs.

Fred Swanson

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oppenheimer1

Fred Swanson wrote: »

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Isn't the VIN soon the cert too?

cruizer101

coylemj wrote: »

There has to be a central repository of this information. There is any number of banks and finance houses lending money on cars - they have to be storing the data in a single database for cartell and motorcheck to be able to check as fast as they do.

They have to pool the data because otherwise a person could get several loans on the same car, maintaining a central database prevents this.

On some further looking into it it would appear they all use HPI Ireland a private company who have a list of members that includes companies that give finance. Now it may still be possible that a company that offers finance is not a member and so they are not aware that a car has finance, it is simply a sharing of information between finance companies not actually anything official.

L1011 wrote: »

They have a very specific financial interest in the ownership of a car

Maintaining a DB of finance, amounts outstanding etc and ensuring its accuracy would not be cheap and serves little purpose for them

I'm confused you say they have a interest in the ownership of a car but then say maintaining a database serves little purpose.

Maybe my understanding of ownership is a bit off so I've few questions. if they own it who has a record of that, is there any official record of car ownership.

In general my understanding of ownership basically was that for houses and cars the government kept a record.

In the case of a house the bank holds ( and as I understand has its name on ) the deeds of a house. In the case of a car there is a reg cert which has the name of the owner and not the finance company if even they are the owner so where is the official record that they are the owner.

L1011

cruizer101 wrote: »

I'm confused you say they have a interest in the ownership of a car but then say maintaining a database serves little purpose.

They need to know who is liable for the motor tax. They have zero reason to care about finance houses claims to cars. Mortgage registration with the PRAI is rather different; has costs involved in doing so, is not updated with every payment and generally deals with six figure sums.

cruizer101

L1011 wrote: »

They need to know who is liable for the motor tax.

Ok yeah i can understand that but I'm still a bit confused tbh. If the bank own it I would have thought it should be their name on the reg cert.
So we are saying the loan is secured against the car so to get their money they can take the car, but they are the only people who have a record of this fact, just seems a bit strange to me

Former Former

The current system is fine. If you're buying a car from a private individual and you don't do a history check for the sake of 30 quid then the system is not the problem.

cruizer101

I disagree, I feel there should be legislation in place that you cannot sell something against which a loan is secured without declaring it. In my mind it is more or less fraud, you are selling something you do not have the full ownership of, you do not have the right to sell it, hence fraud.

L1011

cruizer101 wrote: »

I disagree, I feel there should be legislation in place that you cannot sell something against which a loan is secured without declaring it. In my mind it is more or less fraud, you are selling something you do not have the full ownership of, you do not have the right to sell it, hence fraud.

It already is fraud. However, there is no chance you are going to get a prosecution.

cruizer101

L1011 wrote: »

It already is fraud. However, there is no chance you are going to get a prosecution.

By prosecution I assume you mean criminal case, could you take a civil case?