Apparently there's a lien on my car...

[haggis88]

Could use some advice here Beyond, never been in the situation before.

I bought a fixer-upper RSX-S way back in January from some kid who couldn't afford to fix it (skipped timing chain and his mechanic told him it needed a rebuild).

Anyway, skip forward to this morning and i've been in the process of getting a hail claim sorted out on the car (which ive had insured and registered since way back at the start of May) and the insurance call me to tell me there's a lien against it and they can't pay me out until it's cleared.

Its not against the guy who sold me the car, or anyone at his address and he ticked the "No Liens" box on the Bill of Sale - I was sure I CarProofed the vehicle before buying it and don't remember seeing a lien against it...

I called up the Credit Union who hold the lien and the girl says she's going to look into it and call me back.

Could someone advise me on what to do? How was I able to register and insure the car with a lien against it not in my name? (and how was the seller able to do it too? I have his previous registration slip signed on the back)

[Thaco]

my guess is your insurance company typod or something.. if there was a lien, the registry would have seen it.

[GQBalla]

Wouldn't they still register the car if there is a lien on it?

[G-ZUS]

Happened to me with an old Accord I had, turns out the lein was paid off but the Bank didn't discharge it yet

[Thaco]

Originally posted by GQBalla
Wouldn't they still register the car if there is a lien on it? AFAIK a car cant be sold with an active lien.

[G-ZUS]

Originally posted by GQBalla
Wouldn't they still register the car if there is a lien on it?

Yes they would

[Boosted131]

Happened to my last truck, we had to call dodge/Chrysler hq and get the lien removed

[Aleks]

Originally posted by Thaco
AFAIK a car cant be sold with an active lien.

It can. And new owner can register it. I've sold a few cars with active leans on them with no problem. I just cleared them up in the few days following the sale.

[haggis88]

Originally posted by Aleks


It can. And new owner can register it. I've sold a few cars with active leans on them with no problem. I just cleared them up in the few days following the sale.

fuck, not the news i wanted to hear really...

what would happen if, for instance, the guy who sold the car to me didn't know of the lien or the guy with the lien said he would clear it and this never happened?

Am I on the hook for this now because I have registered the car?

[bjstare]

Yes.

[revelations]

If you have a Carproof printout that says "NO LIENS" (from any province), they have a guarantee of some type - it was only a few G's if I recall though .... :(

[haggis88]

Originally posted by revelations
If you have a Carproof printout that says "NO LIENS" (from any province), they have a guarantee of some type - it was only a few G's if I recall though .... :(

I can't find the carproof i thought I had done on it, and I don't seem to have any sort of history of it being done...

i'm worried i either didn't carproof it, or typo'd it myself

this guy could have a $10k or $20k lien against him on this car and I'm screwed...i don't have that kind of money lying around to spend on a $4000 Acura :(

[revelations]

My guess is that its more likely the bank dropped the ball by not releasing the lien.

I see threads here all the time about this. Even my wifes car was still "liened" by the bank years after she finished paying it off - only noticed it after doing a credit check.

I would do a carproof now to find out any OTHER possible issues with the vehicle.

[Team_Mclaren]

banks miss lien releases all the time.

[haggis88]

Originally posted by revelations
My guess is that its more likely the bank dropped the ball by not releasing the lien.

I see threads here all the time about this. Even my wifes car was still "liened" by the bank years after she finished paying it off - only noticed it after doing a credit check.

I would do a carproof now to find out any OTHER possible issues with the vehicle.



Originally posted by Team_Mclaren
banks miss lien releases all the time.


really hope the bank has just missed it

i did a Carproof and apart from the lien from sometime in 2012, the only other discrepancy is the hail claim i have in at the moment!

[Black Gts]

You would only be out in the car, not the lien itself and should be able to resolve in small claims against previous owner if he lied should it come to that. Probably not what you need to hear but 4k beats 10k worst case scenario. :(

[haggis88]

Got it sorted

Credit Union called me back and said "We removed the lien, do you need a letter for your insurance company?"

Obviously told them yes, and one for my own records...but she wouldn't tell me if it was a mistake, or what they did to resolve it...

Oh well, disaster averted...now just need to work out if I'm gonna use this or my Ridgeline as a winter beater and sell the other :D

[ddduke]

Originally posted by GQBalla
Wouldn't they still register the car if there is a lien on it?

Maybe in the past but I think that things have changed.

I was able to buy all of our ex fleet trucks from my last company at a huge discount so I did. When I sold them I didn't get the lien discharge letter (or whatever it's called) from the leasing company for one. The registries refused to register it for the new owner until he had it, so I had to get that for him.

Apparently it's a relatively new rule.

[dannie]

Originally posted by ddduke


Maybe in the past but I think that things have changed.

I was able to buy all of our ex fleet trucks from my last company at a huge discount so I did. When I sold them I didn't get the lien discharge letter (or whatever it's called) from the leasing company for one. The registries refused to register it for the new owner until he had it, so I had to get that for him.

Apparently it's a relatively new rule.

No. You're confusing two different things.

Liens are not checked when a person registers a car. Hence the OP's initial question. The registry clerk is not required to do your due diligence for you when you purchase a car. So, for the OP... 99% of the time, it is just the bank dropping the ball and not removing it. Definitely get the letter and stop by a registry in the next couple days and pay for a lien check to make sure its removed. It fell thru the cracks once, it easily can happen again.

ddduke... you're referring to a policy about leases. If you leased a vehicle from GMAC, sold the vehicle to me and I went to the registry to put it in my name - the moment the clerk sees the lease company (which is listed on the registration docs above the registrants name) they cannot transfer registration. They require the letter of release from the lease co. Registries don't give a shit about the lien itself, it's all about whats listed on the registration that we care about. That policy is relatively new about 3 years ago.

That being said, if the vehicle is more than 10 years old and it is still showing a lease - if the client is willing to pay for a lien check, the clerk can swap over to that system, put a lien check and remove the lease co from the registration. They cannot do that for a vehicle under that 10 year mark though.

[ddduke]

Originally posted by dannie


ddduke... you're referring to a policy about leases. If you leased a vehicle from GMAC, sold the vehicle to me and I went to the registry to put it in my name - the moment the clerk sees the lease company (which is listed on the registration docs above the registrants name) they cannot transfer registration. They require the letter of release from the lease co. Registries don't give a shit about the lien itself, it's all about whats listed on the registration that we care about. That policy is relatively new about 3 years ago.

.

You're totally right, I needed to get letters from the lease company.

[jacky4566]

Hence the box on the Bill of Sale forms.
This should give you a leg to stand on in court if need be.

On a side note is there a way a person can check for a lien without using an intermediate party? Similar to how the SPIN 2 System works for land titles.

[Masked Bandit]

I've always thought that the purpose of a lender (bank) placing a lien on a vehicle was to prevent the transfer of ownership (sale) before the bank gets paid. If I can sell my car that has an active lien on it, what's the point of the bank putting the lien on in the first place? If I buy a vehicle with a lien on it, what is to prevent me from turning around and selling it to someone else?

[rage2]

Originally posted by Masked Bandit
I've always thought that the purpose of a lender (bank) placing a lien on a vehicle was to prevent the transfer of ownership (sale) before the bank gets paid. If I can sell my car that has an active lien on it, what's the point of the bank putting the lien on in the first place? If I buy a vehicle with a lien on it, what is to prevent me from turning around and selling it to someone else?
The lien is to put the car as security against the loan. That really is the only reason for a lien, registration and transfers are completely separate. It's your responsibility as a car buyer to ensure that there's no outstanding loans on the car and the loan is paid off and lien released.