Purchased a car, Moneybarn threatening to repossess due to previous owner's outstanding finance

waamo

what707 wrote: »

Any idea how much we should expect to pay for that?

See post 11

what707

We've now spoken to Mr X and he says that he purchased the car in a private sale with no knowledge of any outstanding finance and says he can provide us with documentation to give to the finance company.

And according to citizen's advice, it's not even our job to prove that we have good title to the car, it's up to the finance company to prove that we don't. And thus far we have provided ample evidence of our purchase of the car, but they have provided nothing other than threatening letters that claim that they own it, but with no details as to how. They only refer to their unnamed customer with no names, dates, amounts owed, etc and expect us to voluntarily turn over the keys to them based on that.

SophieA23

"If you have purchased a car with outstanding finance on it you will need to take action to avoid losing that car and the entire payment you already made.
A car with outstanding finance was never officially owned by the seller who sold the car to you and therefore will not automatically belong to you after purchasing it.
Representing yourself, issuing court proceedings and claiming back what you are rightfully owed can be complex and will drain your time and finances."
Advice from AWH Solicitors

You should look at taking legal action as this is not an issue that will just go away.

lee1972

At some point a previous owner (probably the one before last) took out finance (I'm thinking a log book loan given the nature of "Moneybarn's" business) on the car.

The terms of this agreement would have stated that the car could be not be sold until the loan was cleared and that if the borrower defaulted on the loan for which the car was collateral, the car became the property of Moneybarn- to be sold in order to recover the outstanding amount.

The seller probably sold the car- which they shouldn't have done- before defaulting, and so OP is left to pick up the pieces.

Whether or not they bought the car in good faith is irrelevant- it wasn't the seller's to sell. The car belongs to Moneybarn. The OP has a case against the seller but Moneybarn legally own the car unless the outstanding balance of the original loan is cleared.

If the OP gets tricky then Moneybarn might back off and go after the person who originally took out the loan as they have a greater chance of entering a judgement against the person who broke the contract with them, but I think this will depend on the value of the car. If it's a valuable car which easily covers the outstanding amount they may persevere in repossessing it- which won't be hard for them to do, I'm afraid.

reason2

lee1972 wrote: »

At some point a previous owner (probably the one before last) took out finance (I'm thinking a log book loan given the nature of "Moneybarn's" business) on the car.

The terms of this agreement would have stated that the car could be not be sold until the loan was cleared and that if the borrower defaulted on the loan for which the car was collateral, the car became the property of Moneybarn- to be sold in order to recover the outstanding amount.

The seller probably sold the car- which they shouldn't have done- before defaulting, and so OP is left to pick up the pieces.

Whether or not they bought the car in good faith is irrelevant- it wasn't the seller's to sell. The car belongs to Moneybarn. The OP has a case against the seller but Moneybarn legally own the car unless the outstanding balance of the original loan is cleared.

If the OP gets tricky then Moneybarn might back off and go after the person who originally took out the loan as they have a greater chance of entering a judgement against the person who broke the contract with them, but I think this will depend on the value of the car. If it's a valuable car which easily covers the outstanding amount they may persevere in repossessing it- which won't be hard for them to do, I'm afraid.

Giving the wrong advice can be dangerous, you may want to clarify that the above is your opinion and not fact...

lee1972

what707 wrote: »

We've now spoken to Mr X and he says that he purchased the car in a private sale with no knowledge of any outstanding finance and says he can provide us with documentation to give to the finance company.

Yeah right! He knew and passed on the car to you knowing full well what had happened. He just didn't want the hassle of dealing with it.

Fair play to you though for trying to sort this out. Whoever sold the car knowing they shouldn't have done needs to be pilloried!

lee1972

reason2 wrote: »

Giving the wrong advice can be dangerous, you may want to clarify that the above is your opinion and not fact...

If you reread my post you'll see I haven't given any "advice"- I haven't said that the OP should do this or that, I've just interpreted the situation.

reason2

lee1972 wrote: »

If you reread my post you'll see I haven't given any "advice"- I haven't said that the OP should do this or that, I've just interpreted the situation.

"The car belongs to Moneybarn. The OP has a case against the seller but Moneybarn legally own the car"

you wrote this as fact when it actually may not be the case

bobbymotors

lee1972 wrote: »

At some point a previous owner (probably the one before last) took out finance (I'm thinking a log book loan given the nature of "Moneybarn's" business) on the car.

The terms of this agreement would have stated that the car could be not be sold until the loan was cleared and that if the borrower defaulted on the loan for which the car was collateral, the car became the property of Moneybarn- to be sold in order to recover the outstanding amount.

The seller probably sold the car- which they shouldn't have done- before defaulting, and so OP is left to pick up the pieces.

Whether or not they bought the car in good faith is irrelevant- it wasn't the seller's to sell. The car belongs to Moneybarn. The OP has a case against the seller but Moneybarn legally own the car unless the outstanding balance of the original loan is cleared.

If the OP gets tricky then Moneybarn might back off and go after the person who originally took out the loan as they have a greater chance of entering a judgement against the person who broke the contract with them, but I think this will depend on the value of the car. If it's a valuable car which easily covers the outstanding amount they may persevere in repossessing it- which won't be hard for them to do, I'm afraid.

Wrong, wrong, wrong.

This comes up on here periodically.

If you buy a car in good faith and that car has outstanding finance on it then you, as the 'innocent purchaser' will ultimately get good title to the car.

http://www.legislation.gov.uk/ukpga/1964/53/section/27

Herongull

Does that still apply if you were the second purchaser? What if Mr X did know about the HP on the car the car? Maybe Moneybarn contacted him and that is why he sold it on? Or maybe he did a HP check on the car before buying it and got it cheap because of the outstanding HP? If he knew about the HP (or can't prove that he didn't know), then he wouldn't have good title.

In this case, maybe the exemption in the HP act doesn't apply even though you are the innocent purchaser? Because you didn't buy from the original person. I have no idea if this matters but this sounds like something you should get legal advice on before you go to court.