Used Cars: truck lein, used car, lien

Question
I just bought a used truck from a used car dealership, and found out that it has a lein on it. What do i do now? Are they allowed to sell it with a lein on it without telling me? I live in Ontario and am not sure what the laws are on this matter? any info would be great.

Answer
I am not certain what the law is either ... but would wager to guess it's a practice that is frowned upon and not endorsed (by the law) it also happens to be a common industry practice you should not panic over at all ...yet! In Oregon we get 15 days to have the payoff in the hands of the lienholder. after that banks are usually pretty good about sending them right out to us but even so 3 weeks from trade in to getting the title on a car or truck with a lien against it is pretty much the norm. During that time the dealer will usually get it right out in front for sale as fast as he can get it out there after running it thru the shop and doing any reconditioning work / and a detail. We will NOT make the payoff on any trade as a dealer until we have been funded on the deal that brought us that trade-in. When dealers call to get the payoff amount we generally ask for a payoff good for ten days out. It is nothing for a car to be bought and sold many times (us to a wholesaler who sells it to another dealer who sells it to a retail customer) before we ever get the title. If it sounds confusing let me tell you how we are able to keep it simple ... we only pay for a car we buy when we can trade a check for the title! In the example above ... the car was sold 3-4 times but until the title comes in ...the car is the only thing that has changed hands ....not any money! The title arrives we call the wholesaler who brings us a check he gets the title from us and runs to the dealer he sold it too and gives him the title and he gets a check etc. No title? No Money! It's real simple. Now if the car has not been paid off in 15 days or so then you can pick up your phone and find out why and when it will be paid off. Since you have bought the car DMV's in most states and in Oregon for sure will generally protect the buyer (you) from a dealer who goes out of business with unmade payoffs floating around. The short answer is it is a common industry practice ...dealers are not technically supposed to do it but all of them do and while you should be aware of it and make sure in the back of your mind that it needs to be paid off and don't just assume that all car dealers have piles of cash in this market ...they don't! But I wouldn't lose any sleep over it at all ...better to lose sleep wondering how the Canadians are going to be able to defend that Gold Medal they got in hockey in 4 years!  



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