Buying a used car with a lien on it

[LUCKYSTRIKE]

Hey guys,

I was just wondering how I should go about buying a car with a lien on it. The seller says I should make out the cheque to his credit union and his name, does this sound correct?

I want to go to the bank with him and ensure that the lien is lifted when we hand in the cheque, will this work?

[Weapon_R]

Yes, go directly to the bank with him and make sure that the lien is completely paid out to the credit company.

[Neons4life]

I would make sure it states on the bill of sale "free of liens". And on top of that I would go to the bank and pay it off, he would get a letter showing the lien being removed.

I have done this a few times already, it's really easy and only takes a few minutes.

[JRSC00LUDE]

Yes, making it payable to both of them is a common transaction. Otherwise, if you're really worried, you could request to go to his branch and make out two cheques (one to them for the payout and one to him for the balance).

[LUCKYSTRIKE]

So I am in Calgary and buying the car off a guy in Edmonton (with his credit union in edmonton) with the certified cheque or bank draft w.e. I give him does it clear up the lien instantly? So would I be safe just to drive the car home without worrying about the lien on it?

[JRSC00LUDE]

If it's payable to both of them, he cannot cash it without their endorsement so you should have nothing to worry about. Obviously it will take a short while to clear the record from you personal property registry (or whatever you call it in alberta) but I can't see you getting screwed over. That bit about having the bill of sale "free of all liens" is a good idea though.

[redblack]

get a signed letter from the credit union saying that they have no further interest in the car and that the loan has been paid out