Buying a car with finance owing

whizkid9

Hi, I am considering buying a used car. there is an outstanding amount of 5Kish owed on the car.

Can anyone advise, how to proceed with the purchase? while safeguarding myself?

Anaki r2d2

Simple answer is= don't buy it. You have went to effort or checking it. You know there is outstanding credit. Even if you buy it, you risk losing it

If you are indeed a whizz kid, walk away

You don’t? Why would you buy a car that the current owner may just keep the cash altogether and leave the debt owed?

the car ends up repossessed and you’re out the cash and the car. It’s a private sale so no recourse for you & the finance company isn’t going to care.

you would be absolutely mad to buy it.

whizkid9

https://www.boards.ie/discussion/comment/121230456#Comment_121230456

Thanks. The seller was open about it and is okay with me directly settling the outstanding amount with the hire purchase bank. Does this change anything?

LIGHTNING

Why bother with the hassle? Plenty of used cars on the market.

whizkid9

https://www.boards.ie/discussion/comment/121230504#Comment_121230504

seller willing to sell ~20% cheaper than what is on the market

bazz26

I don't think this is as outrageous or uncommon as it seems if done properly by both seller and buyer.

Seller should get a settlement figure from the bank. Buyer then accompanies the seller to their bank and pays the finance settlement figure directly to the bank. Bank then gives the seller an official letter/statement listing that the finance/loan is settled in full on the car and they no longer have any interest in it.

User1998

Ignore previous comments. As above, get the settlement figure, settle the finance, and pay the balance to the owner.

Better yet if the finance is with AIB you can do it all at once in an AIB bank.

Most expensive cars have finance owed so this is not uncommon.

goochy

is the car 20 % cheaper than retail or other private sales ??

Anaki r2d2

Why sell 20% below? if you know the person well, maybe then buy it. But I would deal with the hassle. What price of car is it?

GusGus

so many silly comments- of course there is no issue with buying a car with finance owed . The owner was open and honest - it wasn’t discovered . Just settle the finance separately. It’s hardly a big deal nowadays .

Jim2007

https://www.boards.ie/discussion/comment/121230467#Comment_121230467

The seller does not own the car, the HP company does. And there is no guarantee that the HP company will settle for that amount outstanding… so they may hit you up for more money. And what are you going to do to get your money back if it does not go through?

Surely there must be other cars out there where you can pay your money, get the documents and go on your way…

Breezy_

https://www.boards.ie/discussion/comment/121234830#Comment_121234830

Would paying the outstanding not settle it? Why would they ask for more?

User1998

Nonsense, you get the settlement figure from the finance company and pay it. Its not difficult at all. I’ve done it several times with AIB.

Yes, its a bit more hassle than buying a €2k car for cash, but most people finance their cars nowadays and can’t afford to settle the finance themselves, so if your buying a €20k car privately then this is what your going to have to deal with a lot of the time.

Jim2007

https://www.boards.ie/discussion/comment/121234884#Comment_121234884

There is almost always a penalty for breaking a financial agreement early and of you don't know one way or the other, so why bother with the extra hassle?

Allinall

https://www.boards.ie/discussion/comment/121235861#Comment_121235861

The penalty is on the person selling the car.

They just get the remainder of the agreed price after the finance is settled.

Its a perfectly normal arrangement and nothing to be worried about.

User1998

https://www.boards.ie/discussion/comment/121235861#Comment_121235861

Whatever penalties your talking about would be included in the settlement figure.

bazz26

https://www.boards.ie/discussion/comment/121235861#Comment_121235861

The settlement figure on the day of request will include any early breakage penalties, admin fees, etc. Once the settlement figure is paid then they no longer have any legal holding on the vehicle so there will be no chasing the new owner later on, it's not the Mafia. You can also request they issue an official letter/statement to that effect.