Hi folks
If a dealer sells you s/hand car on p/x without clearing previous outstanding credit to finance company (or telling you), who owns the car? If the finance company writes to buyer after two months of purchase saying they are repoing it due to unpaid credit of previous owner, how do you keep it?
Thanks.
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I think you need to go and see the dealer!
And the sue him.
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The buyer is the legal owner as when you buy from a trader you automatically get title to the vehicle. The finance company should be tackling the trader that sold the car or the previous owner not you as the current owner. The trader may not have known there was outstanding finance, but should have checked. The buyer should have also done an hpi check to make sure the vehicle didn't have outstanding finance or other nasties lurking in its history.
I don't think the finance company can legally repossess the vehicle as the title has passed legitimately to the new owner. The previous owner has broken the terms of their credit agreement by selling the car with outstanding finance. I don't know whether it is a criminal offence to sell a car with outstanding finance though.
How much finance is there outstanding on the car? If it is less than half of the original borrowed amount then I don't think the finance company can repossess anyway unless it was bought on a PCP agreement which I think have differing rules.
I would contact trading standards as they will know exactly where you stand.
teabelly
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Yup, good title has passed to an innocent private purchaser,( if an HP agreement)!
Once 1/3rd of the total hire purchse price has been paid a vehicle cannot be re-possessed from a defaulting hirer.
A specific personal loan, if applicable, has no legal interest at all in the title to the car and whilst breaking the terms of the loan agreement by selling the car without settling the loan, the borrower has not committed an offence.
If it's a loan tell them to go forth and multiply! If the loan agreement is still registered on HPI it may well be a problem in any future sale.
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Roger. (in the UK for 3 more days and then back to the sun! )
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Law may have changed, but if not then there is a qualification to your statement - if 1/3 of the HP price has been paid it can't be repossessed *without a court order*. And this only applies to Hire Purchase in all its forms, not for example to leasing.
Again subject to any changes I am unaware of, basically being an innocent purchaser depends on having bought from a dealer - if a private individual sells you a car with outstanding HP on it, or one owned by a leasing company, then you may lose it.
It's not that uncommon for even reputable dealers to be slow to settle HP that has been taken into account on a trade-in and for the interest to remain registered for a period.
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Yes, you are quite right about the court order.
it's a long time since I was in the HP business, but IIRC even a private sale/purchase was covered by the innocent private purchaser clause. It was, of course, much abused, and in those dim and distant days private punters could not access HPI as they can now!
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Roger. (in the UK for 3 more days and then back to the sun! )
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Thanks for all the answers, much appreciated.
Trent
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You're probably right malteser - it's a long time ago for me too. One thing for sure, a dealer can't be an innocent purchaser.
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