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As you may remember my son is considering buying a Peugeot 406 coupe,we are going to see a car tomorrow,after doing an AA check we have found that it has outstanding finance on the car. We dont understand what obvious dangers there are with this situation.Could anyone offer any comments on pitfalls we might need to look out for,thanks, tonyh
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Avoid at all costs. It means the car is still owned by the finance company and isn't legally the sellers to sell . If you buy a car with outstanding finance the finance company will reposess the car and leave you with nothing. You won't own the car because the finance company still does.
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Thanks, my son has since spoken to the seller who got shirty when asked about the outstanding finance,so he has now decided to leave well alone cheers tonyh.
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You might be jumping to the wrong conclusion....
The AA might have a 'outstanding finance' on it database but its possible the finance has been paid in full but the finance company has not informed the AA/HPI registers. This happens a lot !
The AA should give you a reference number and the contact number of the finance company concerned. A quick phone call to them should resolve the matter either way.
Did your son go in guns blazing accusing the guy of selling the car with finance owing ? If so the sellers shirty attitude would be understandable if he has genuinely paid the finance ;-)
Probably worth making the phone call to the finance company (they will interested to know if this guy is trying to sell with finance owing).
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If the car is what your son wants and the price is right, then there is no reason for not buying it. Simply give the seller 2 cheques, one for him and one for the outstanding amount for the finance company. he will have no option but to send the fin co their cheque.
It is illegal for the registered keeper of the car to sell it without good title. If he signs the receipt then he will be liable for criminal prosecution as well as any outstanding monies owed on the car. They will only pursue you if he cannot pay (and that includes through court).
Jonathan
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You can improve on Jonathan's fine advice by sending the second cheque directly to the Finance Company to avoid any fraud.
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Why bother? There are lots of cars out there without this hassle. I wouldn't touch it with a barge pole. Thank goodness you did an AA check. BTW I seem to recall other backroomers having lots of problems with Peugot 406's.
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Why bother?
because it might be the cheapest or best specced car around.
Just because a car has finance outstanding on it is absolutely no reason for not buying it. How is the person who has finance on it expected to get rid of the finance without forking out on a loan, if he has loads in the bank, then he probably wouldn't have needed finance in the first place. Should they be stuck with the car until it is all payed off? What if they have a horrendous apr o the final value is way too low and want to make sure they get something out of it, rather than just handing it back to the finance company. Would you expect a dealer to take your car off you as a part ex if it had finance? Most would happily take it, and just give you the balance and settle with the finance company separately.
Don't be scared of something you don't understand.
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I do understand it took an AA check to reveal there was outstanding finance on it. As I said before there are plenty of other cars out there. If the seller was not upfront about the finance what else is he concealing?
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The original post said nothing about the vendor hiding the fact. Indeed it would not be very clever to advertise any car with finance outstanding on it. Better to tell the person once they have come to see it that they will use the money from the sale to settle the finance. Perhaps the buyers wanted to check that it had not been written off etc.
If you instantly dismiss any car that has finance on it, then you will find your choice cut considerably.
Jonathan
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A car with outstanding finance is owned by the finance company. The vendor is not entitled to sell it - it is illegal. There are thousands of cars for sale to choose from without baggage. I can't see any reason for wasting time on such a car.
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I would agree with you Jonathan. Why turn down a perfectly good car just because it has outstanding finance? As long as the seller has been up front about it and the finance company are happy to authorize the deal its not really a big deal.
Like i said earlier ... its quite likely the finance has been paid but the AA datacheck service provider has not recieved updated information.
Just this week i bought a 1995 Alfa Romeo 155 which had a 'outstanding finance' recorded against it. A quick phone call to the finance company revealed the finance had been settled in 1998 !
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The seller did reveal over the phone that the car had outstanding finance,we then carried out theAA check ,my son then phoned the seller and in a reasonable manner asked if he could explain about the finance. The seller then made remarks about my son being very picky and put the phone down (the seller did).Because we were going to travel from Telford to Birmingham to see the car we decided to leave it alone cheers tonyh
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When I am a buyer, I expect the seller to present the car in a saleable condition. If it has outstanding finace, imo that is the same as rusty/unwashed /clappedout/etc.
Why buy trouble the vendor can't be bothered to sort out? Life is complicated enuf...
madf
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