Used Cars: buying a car with lien on it, nissan finance, honda finance

Question
QUESTION: Hi,

I am planning to buy a pre-owner car from a private seller. The seller is moving out of country soon and wants to sell the car asap. He has settled the loan on 8th Jan, but HONDA FINANCE has just shipped him the title and papers. He hasn't received the papers yet as of Jan 26th.

1) Can he transfer ownership of the vehicle to me without the title or lien release papers?
2) He says that DMV can issue him a duplicate title by calling up the lienholder and confirming release.
3) If I go to a DMV with him, and proceed with the transfer process (without a title or lien release paper), is there any chance that the lien will get transferred to me without my knowledge?

Thanks,
-Swapnil

ANSWER: I wouldn't risk getting the title transfered without the lean release papers - go to the DMV with him - get him to sign a bill of sale - get the DMV to acknowledge the lien has been withdrawn (they can call honda finance) - and then they can issue a duplicate title - This way the DMV has record that the lien was withdrawn - and you have a buffer in case they ever try to stick you with the lien. If the DMV wont do this... I wouldn't transfer the title until he receives the papers. There is too much risk - especially if he leaves the country.

---------- FOLLOW-UP ----------

QUESTION: Ok, I dropped the idea of buying a car from this person.

I am now interested in another car, but even that has a lien on it.



Here's how I plan to execute this.

1) Sign the BILL OF SALE and have it notarized

2) Mail a check in the name NISSAN FINANCE along with an authorisation letter from seller to transfer the title and also mail it to ME. I checked with NISSAN FINANCE and they said they do entertain such a process.

3) Do I need he seller to sign any other document for my safety? If there are any specific formats or words I should include, please let me know.



thanks for your help

Answer
If nissan finance said they will drop the lein when the check clears.. I'd say you are good - You may want to type up a document for the seller to sign acknowledging that their is a lien on the vehicle and that the lien is to be lifted up purchase by nissan finance - It wouldn't be a legal document - but a contract is a contract - and IF you ever had to go to court - it would be a big help to you. Other than that - I'd say make sure (double check) - nissan finance understands the situation - and if everything clears out - go for it.