[Closed] Buying a car with outstanding finance

Completely legal and commonplace to advertise a sale in this scenario. It does put buyers off... The typical way to deal with this is for the buyer to pay the finance company directly and the seller releases the car once the payment is confirmed (and once they've received any additional money from the buyer which may make up the balance of the sale price).

Assuming that this is not stocking / wholesale finance which also shows up on HPI and is a consumer deal then I wouldn't say it's normal for any decent sized dealer to leave consumer finance outstanding. It's also dangerous for the consumer as you've relinquished the car but remain liable for the funding.

It should come in, the HP/PCP be cleared and then go on a specialist stock funding product.

If it's "off books" / sold as agent I don't know where you stand on consumer rights.

Personally I'd be wary but as tallpaul says you could add a layer of protection by settling direct although some funders may balk at taking third party money for money laundering reasons. There's also the risk that you pay and then the vehicle doesn't get handed over.

Imo it's better to deal with a transaction where you don't get stuck in the middle of someone else's finance agreements.

Cheers, yes I don’t feel comfortable paying off someone’s else’s debt so I’ve told the dealer I won’t be transferring any money till I have proof that their debt is paid.
I think my spider senses are tingling, so may give it a miss. The annoying thing is the dealer didn’t declare any outstanding finance before I put a £500 deposit down. Now I’ve got to go through the rigmarole of getting it back!

I don’t think that you’re ‘paying off some one else’s debt’ you’re buying a car, and the seller is using the proceeds to pay off his debt, which is pretty reasonable. If you don’t trust the seller to do this, then as above, offer to pay the finance company directly the outstanding balance and make up the difference with the seller. This is how all mortgaged house sales work with mortgage companies; similar principles really.

I bought my last car from a bloke at work that needed the money to clear his finance; I trusted him that he’d do it and he sent me the confirmation that he had done as soon as he’d got it from the finance company. A bit different if it’s a random bloke off the street I suppose.

I helped my sister buy a car privately that had finance outstanding, she paid the finance off and the balance to the seller. That way we were sure the finance was clear.

I was looking at a van that came up with outstanding finance in the HPI check.

I asked the seller and said I wasn't viewing the van until it was cleared (long trip). Within 48 hours it was paid, I checked by calling the finance company, and they emailed me a PDF letter to confirm the they no longer had an interest in the vehicle.

Plenty more cars to buy if it’s even remotely giving you concern get your deposit back and walk.

The annoying thing is the dealer didn’t declare any outstanding finance before I put a £500 deposit down. Now I’ve got to go through the rigmarole of getting it back!

i think thats what would annoy me most here and id probably get my deposit back and not deal with them any more on principle for that reason.....

Nothing wrong with it, cars are mainly financed these days and if you were selling one could you clear a big debt without selling first?

If you’re concerned about it, I’d just get a settlement from the finance co, pay that directly to them and the balance to the dealer. That way you get the car you want and with nothing to worry about as you know it’s been done. Like you I’d definitely be wary of paying the dealer the full amount.

Should be a better price too to reflect the fact it’s probably a private sale as far as warranty etc goes - maybe check this.

Thanks for the replies, yes it is a good price, that’s probably why!
As far as I’m concerned if the dealer is happy to advertise the car then they should settle the debt first. I’ve told them I won’t be paying a penny till I see proof the outstanding finance fully settled.

No, there's a kind of finance for dealers where they can use the proceeds of a sale to pay off the finance, so they don't need to tie up cash to own the cars outright. Unit stocking. Get the dealer to confirm in writing that it will be cleared at point of sale, or they might agree to do it before hand if they have the cash and that's a deal breaker for you, but it's not generally something to worry about as long as you get the confirmation.

https://www.hpi.co.uk/guides/types-of-finance.html

I recently bought a car privately, I paid off the remainder of the loan and paid the balance to the seller. It's what the internet said to do 🙂

All, ok since.

A £500 deposit would’ve had me twitching! Think last time I put down £100 and that was a main dealer