Help on Lien information

[artieg30]

Hey guys, got another question again, I went to the registry today to do a check on a preowned car i'm buying, it says that it still has a Lien on it. Now the Dealership i'm dealing with (Calgary Honda) has told me that they sent the cheque out to the bank responsible for the lien, and so the lien should cleared next week. Is this something I should be concerned about if the lien does not clear by the time I go to pick up the car next week? Correct me if i'm wrong here but dealerships are legally inclined to pay off the lien before they sell it to another customer right???

[canuckcarguy]

I'd want it in writing from Calgary Honda that they're selling you the vehicle on a lien-free basis, but since you're dealing with a franchise dealer, you should be okay. I'd just make sure that whatever contract you get spells out in writing the time limit for them to have the lien released (or a letter from the lien-holder indicating they have no further interest in the vehicle) and the remedy they will offer in the event that the lien is not released in a timely fashion.

[artieg30]

yeah I was thinking something along the lines of that too, but the finance manager there said she'll put it in the contract as a condition of the sale, so I should be protected. I guess it should be legit cause the only reason its still showing up is because the car just came in like a week ago so thats probably why. That and the dealer is AMVIC licensed so I should be safe.

[canuckcarguy]

It's pretty common for the liens to still be on there pending the finance company's release, and with a reputable dealer like that, you should be fine. Putting it as a condition of the sale is okay - it means that if they can't remove the lien, you can unwind the sale and walk away with your money. If you're financing the vehicle, that's probably even better, since the finance company won't advance funds without feeling pretty confident that they'll have a clear title vehicle to lend against.

Congrats on the new car!

[artieg30]

Thank you, and would I be able to contact the finance company regarding the status of the lien or is that a confidential sort of thing?

[canuckcarguy]

It likely is confidential, but they'll probably be okay confirming that they have no further financing interest in the car, even if they won't give you details of the interest they used to have in it. But if the cheque from the dealership hasn't cleared yet, they may not be able to state that their interest is null and void...