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CARFAX

How to Resolve a Private Seller Lien

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Remove the lien and take ownership of the vehicle.

2016 Ford Fiesta ST
2016 Ford Fiesta ST

When shopping for a used car, you stand to save money on your purchase when buying one from a private seller. Dealer markup can add hundreds to well over a thousand dollars to the price of a car, money you can save by negotiating directly with the vehicle’s owner.

If the owner is still making payments to a lender, then there is a lien on the car to remove before you can buy it. A lien essentially locks down the car’s title until the loan obligation no longer comes into play. The following are the steps to take to resolve the lien:

Step No. 1: Learn the Vehicle’s History

No used car deal should take place before confirming the vehicle’s repair history. That information is available through Carfax.com, a company that compiles vehicle history reports specific to a car’s vehicle identification number (VIN).

A vehicle history report should show its repair history excepting the work that the owner performed on his own. Importantly, if the car has been in an accident or damaged by a flood, then the history report should reveal that information.

2016 Honda HR-V
2016 Honda HR-V

Step No. 2 — Confirm Vehicle Ownership

Simply because an individual claims to own a car does not make that person the rightful owner. You need to inspect the title and run the VIN through the National Insurance Crime Bureau VinCheck to verify ownership.

VinCheck will confirm if a vehicle was reported as stolen, but unrecovered. It will also list whether it is a salvage vehicle, one that’s damaged or was seriously wrecked.

Step No. 3 — Inspect the Car With Care

Vehicle history reports can only reveal so much about a car. If you are handy, you can perform
the inspection yourself, otherwise, head to your mechanic and pay him to check the car.

Have the car placed on a lift and examine the vehicle’s suspension system, inspect the vehicle’s frame, review previous repair work and look for leaks from the engine, transmission and the coolant system. A mechanic can also pull up the check engine codes to look for potential problems.

No independent analysis will be foolproof, but your mechanic can offer his opinion on whether the car is worth your consideration and for the price you have in mind.

2015 GMC Yukon XL
2015 GMC Yukon XL

Step No. 4 — Negotiate Your Price

How much a private seller still owes his lender may have a bearing on your negotiation. However, if this individual owes more on the vehicle than what it is worth, you need not offer to pay that price.

Instead, your price for the car should be based on its current market value, its condition, mileage and vehicle’s trim level (content). Visit Kelley Blue Book to obtain its private party value. You can show your mechanic’s report to back up your offer.

Step No. 5 — Head to the Bank

Never give money to a private seller and have him handle the paperwork. Because there is a lien on the car, you should meet the seller at the bank and complete the deal in front of a representative.

Explain to the bank representative what transaction is taking place and have the seller ask for the loan’s payoff amount. Your funds plus whatever the seller still owes his lender will remove the lien, freeing the vehicle for a title transfer.

2015 Lexus RC F
2015 Lexus RC F

Let’s Make a Deal

Finalizing a deal for a vehicle with a lien on it is not always an easy process. That said, with persistence you may be able to conclude the deal and obtain a quality car for a below market price.

See Also — 8 Steps to Buying a Used Car

Photos copyright Auto Trends Magazine. All rights reserved.

Used Car Shopping Caution: Odometer Fraud

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Odometer fraud can cost you dearly.

odometer fraud
Odometer rollback isn’t always easy to detect.

Consumers looking to buy a used car understand the importance of checking it thoroughly, including the finish for rust and the key components such as the engine and transmission for damage. Brakes, lights, seats, air conditioning, steering and electronics should also be inspected, but there is one problem that is often missed: odometer fraud. Odometer fraud is what happens when the odometer reading is rolled back to mask a vehicle’s actual mileage. The problem affects tens of thousands of cars every month and costs consumers millions of dollars in lost value and unexpected repairs.

About Odometer Fraud

Changing the mileage on the odometer is illegal and can result in fines if the seller is caught. According to CARFAX and as reported by the Orlando Sentinel, a vehicle history report company, more than 190,000 cars are sold each year with their odometers tampered. The cost to consumers is at least $760 million in reduced vehicle value and unplanned car repairs. CARFAX estimates that there are more than one million vehicles on Americans roads with an odometer rollback.

CARFAX notes that older cars, typically those that are 14 to 15 years old, are most susceptible to fraud. These models often have at least 50,000 miles taken off of the odometer before they are readied for sale.

Signs of Fraud

Used car buyers may not be able to entirely eliminate the possibility of getting ripped off, but they can reduce their chances by launching a personal investigation first.

The first step is to visit the National Insurance Crime Bureau website to perform a vehicle identification number check (VINCheck). Enter your car’s unique 17-digit VIN (typically found on your dashboard) to determine whether it was stolen. If clear, you can continue to consider that vehicle.

The second step is to purchase a vehicle history report, offered by CARFAX, VINSmart and AutoCheck. You will pay a fee for these services, but the information provided can alert you to possible problems with that used car. Not all repair information is included, but it can point out potential problems that a visual inspection may not reveal including its use as a rental vehicle or a taxi, whether it was damaged in a flood, and its owner history. Your reports should also include an odometer reading. Compare that reading with your car’s current reading — it should align closely, otherwise tampering may have occurred.

The third step is review the seller’s supplied maintenance records. If there are no records present, there is a good chance that something is amiss. If you still want the car, then take it to your mechanic for an inspection. He will visually examine the car and connect it to his computer to print out a report.

Civil Remedies

State odometer laws vary from state to state and may include recovery from damages under state law as well as under federal law. Under the Code of Federal Regulations (CFR), odometer tampering violations include “resetting or altering the odometer with intent to change mileage” and “making false odometer disclosure statement.

“Consumer recourse” includes $1,500 or treble damages, whichever is greater, in addition to attorney costs. An assessment may also be required to determine whether the vehicle’s value has been reduced, its financing, insurance, and tax costs inflated, and unexpected repairs made.

If you are caught committing odometer fraud in Ohio, the first offense is treated as a fourth-degree felony, punishable by 6 to 18 months in jail and a $5,000 fine. The Buckeye State operates a toll-free hotline to report odometer rollback fraud, representing one of the more aggressive consumer protection programs in the US.

Win the Battle

Due diligence on your part can avoid getting sucked into a scam. Recourse is certainly possible, but the hassles you’ll experience can be a time suck.

See Also — NICB Warns Consumers About Storm Fraud

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