I want to buy a car from someone who still owes money on it to the bank. What is the best way?

Question

She doesn't have the funds to pay it off without me buying it first. But she doesn't have the title since she owes money on it. How can we work out this transaction?

Answer 1

Go with her to the bank holding the lien. Pay the bank what they're due and then the remainder to her. Once the bank is payed they will surrender the title to you.

Answer 2

It depends on how you are paying for the car. This can be a somewhat risky transaction if you are dealing with a stranger and/or a large bank.

If you are paying with your own money, you can make a simple buyers contract or bill of sale stating that you are purchasing the car from her for X amount of dollars with X amount of dollars going to ABC Bank to pay off the loan on the car and remaining X dollars to owner. To keep yourself safe, you can accompany her to the bank and have a notary public notarize both of your signatures on the contract, then make the payment on the loan with a personal check, cashiers check or money order.

If she banks with a credit union or smaller bank, they may keep the titles on-site and release it immediately after paying off the loan. She can just sign it over right there to you, safely completing the transaction.

If you are obtaining a loan on the car as well, you can ask your bank or credit union to issue two separate checks; one to her bank for the loan payoff, and the other to her personally.

Here is the problem: You run the risk of paying the loan off for her, then she doing nothing and keeping the car and title. Some large banks take up to 2 weeks to mail car titles to the owners after the loan has been paid off. That is why it important to have a written bill of sale if you should need to pursue her in court.

Answer 3

depends on how much she wants for the car. if its more than what she owes the bank, offer to pay off her loan at the back. and make sure you get EVERYTHING in writing!!!!

Answer 4

WHY DON'T YOU JUST CALL YOUR LOCAL DMV OFFICE, THEY WILL BE ABLE TO ANSWER ANY AND ALL OF YOUR QUESTIONS AND AT THE SAME TIME YOU WILL BE GETTING THE CORRECT ANSWER TO YOUR QUESTION.