Log Book Loans - liability ?

ricky101

Hi,

Seems the law on making it illegal to sell a car with a log book loan against it is waiting to be passed,  so it does make buying a second hand car privately rather doubtful.

If we did buy from a private source, is there any disclaimer type of form we could ask the seller to sign saying there are no ourstanding loans , though would it have any legal standing ?

Would also like to know what the situation is if bought from a registered dealer , be it a main dealer like Ford, the big car supermarkets or small traders,  if they had taken in a car and then resold it to us, would we still be repsonsible for any outstanding loan/ loosing the car   or would their traders insurance etc protect us ?

born_again

Is that not the whole point of doing a HPI check?

The_Rainmaker

I thought logbook loans were in the main given by dodgy individuals who chased missed payments with baseball bats?

forgotmyname

If a seller is going to sell a car with a logbook loan attached to it they wont have any quibbles
in signing your bit of paper.

facade

The_Rainmaker said:

I thought logbook loans were in the main given by dodgy individuals who chased missed payments with baseball bats?

Those sort wouldn't show on an HPI check, and probably wouldn't be enforceable, except by the individuals with the baseball bats

But believe it or not there are "reputable" log book loan companies, they do register the loan with HPI!

If you paid for an HPI check, and then adhere exactly to the strict terms of the HPI guarantee, (something about only paying in kugerands dated 2007, on the first full moon, at Machu Picchu ) You will be refunded by HPI (I think you get some sort of trophy if you are)

The reason you have to give up the car (or pay off someone else's debt to keep it) is because the lender will hold a registered bill of sale for the vehicle, which gives them undisputed ownership.  (The dodgy ones might not register it, but remember the baseball bats? ) This operates outside the regulation that gives an innocent purchaser good title, and is probably what this "New Law" was about, as it has always been illegal to sell a vehicle subject to a logbook loan.

If the car was bought from a trader, then you would ask the trader to pay off the loan, or refund you the purchase price. If the trader has managed to go bust, then you could claim against the person who originally sold the car, as they had no right to sell it.

ricky101

Seems its still a very grey area,  think it will be simpler to buy a new Sandero, not the most refined motoring but a similar price to the second hand other brands we were looking,  but  not doing the long drives these days.

EdGasketTheSecond

No way to guard against log book loans if buying privately. Log book loans dont have to be registered with HPI but they can legally reposess the car from you. If you buy from a dealer, the dealer takes the hit assuming they are still trading when you discover the log book loan. There were proposals in 2017 for new laws to give unaware buyers clean title but for some reason the gov't didn't implement the new laws so there is no protection at the moment. HPI may find some log book loans but not all.