Buying a car with a lien. How do I protect myself?
02-26-2013, 01:42 AM
#1
Super Member
Thread Starter
Buying a car with a lien. How do I protect myself?
It looks like I found my next car. Now that I'm driving more, I am forced to ditch my SL600 in favor of something with more room and better gas mileage, so I am going back to the "dark side" and getting a BMW 335i.
I'm paying $24,000.00. The owner has a loan on the car for about $20,000.00 through BMW financial.
BMW financial says that once they get the payoff, they will send the title and lien release to the original owner. Even if I send them the payoff, they will only send the title to the owner. I guess this makes sense since the owner has to sign the title over to me anyway.
My plan is to get a signed and notarized bill of sale from the owner, send a cashiers check for $20,000.00 to BMW, and give a cashiers check for $4,000.00 to the owner. I will then take possession of the car.
Hopefully then when the owner gets the title, he will notarize it and sign it over to me.
I think that a bill of sale along with the fact that I can show evidence that I paid for the car ($4,000.00 to the owner and $20,000.00 directly to BMW financial to pay the lien) would be enough to protect me if the owner had any second thoughts about keeping the title and trying to screw me when it arrives from BMW financial.
I also think that me sending BMW financial the payoff and paying the difference to the owner is better then me just getting a bill of sale and giving $20,000.00 to the owner (as then he could use the $20k for whatever he wants). Then the car might not get paid off and I would be really screwed.
I think the key points are:
-Get a signed and notarized bill of sale
-Send payoff directly to BMW financial from me
-Take possession of the car and keys
Am I on the right track? Am I missing anything? I've never done this before. I've always traded cash for a clear title.
I'm paying $24,000.00. The owner has a loan on the car for about $20,000.00 through BMW financial.
BMW financial says that once they get the payoff, they will send the title and lien release to the original owner. Even if I send them the payoff, they will only send the title to the owner. I guess this makes sense since the owner has to sign the title over to me anyway.
My plan is to get a signed and notarized bill of sale from the owner, send a cashiers check for $20,000.00 to BMW, and give a cashiers check for $4,000.00 to the owner. I will then take possession of the car.
Hopefully then when the owner gets the title, he will notarize it and sign it over to me.
I think that a bill of sale along with the fact that I can show evidence that I paid for the car ($4,000.00 to the owner and $20,000.00 directly to BMW financial to pay the lien) would be enough to protect me if the owner had any second thoughts about keeping the title and trying to screw me when it arrives from BMW financial.
I also think that me sending BMW financial the payoff and paying the difference to the owner is better then me just getting a bill of sale and giving $20,000.00 to the owner (as then he could use the $20k for whatever he wants). Then the car might not get paid off and I would be really screwed.
I think the key points are:
-Get a signed and notarized bill of sale
-Send payoff directly to BMW financial from me
-Take possession of the car and keys
Am I on the right track? Am I missing anything? I've never done this before. I've always traded cash for a clear title.
02-26-2013, 10:21 AM
#2
Super Member
Your process seems about right... the ideal thing to do is state EVERYTHING in the bill of sale... sit there for as long as you need when writing up the bill of sale and think of every little loophole that could come up. Document the whole lien process and retrieval of the title... it's less likely that someone will try to pull something when they have their signature on a very thorough bill of sale.
