ea_sport Reader
5/15/22 7:49 p.m.

I found a good deal locally on a '17 Camaro SS 1LE but the seller still has loan so he doesn't have the title (I live in VA). How hard is it to buy a used car from personal party with loan balance? 

One of my concerns is that when I hand the money over to the seller or the seller's lender in theory the seller still owns the car so I will have to rely on/trust the owner that he will do the right thing. Once the loan is paid off the lender will send the title showing the lien has been removed to the seller. I will then have to go to the DMV with the seller to hand over that title to the DMV and title it under my name. This process can take a while (may be weeks up to a month) depending on the lender and I have the car sitting in my garage. This is assuming the seller is trustworthy. 

Any one have a good suggestion on how to buy a car from private party with loan balance that can minimize the risks, any  third party service that can help expedite this process?

Thanks guys.

Cousin_Eddie (Forum Supporter)
Cousin_Eddie (Forum Supporter) Dork
5/15/22 7:59 p.m.

I've done it a few times.

I use my bank. They will send the money and also assure the power of attorney is complete and that the title comes to you. The seller will never see the title. It will go straight to you. 

ea_sport Reader
5/15/22 8:10 p.m.

In reply to Cousin_Eddie (Forum Supporter) :

Presumably you couldn't title and register the car until you receive the title from your bank?

AnthonyGS (Forum Supporter)
AnthonyGS (Forum Supporter) UltraDork
5/15/22 8:25 p.m.

Arrange financing through your bank.  They will pay off the other bank and that bank can remit remaining funds to the seller.  That is the safest way.  The other way is to get your own financing and take your certified check to the sellers bank.  They will give you the paperwork to take to your bank. 


John Welsh
John Welsh Mod Squad
5/15/22 8:34 p.m.

I too have seen advice that says, "buy this car with a loan even if you do not have to."  What happens then is your bank and you are buying the car and your bank knows how to protect themselves.  

ea_sport Reader
5/15/22 8:35 p.m.

In reply to AnthonyGS (Forum Supporter) :

Unfortunately the loan is with a financing company and not a bank with a local branch. But I like the idea of getting financing and let the banks figure it out. I was going to pay cash initially.

AnthonyGS (Forum Supporter)
AnthonyGS (Forum Supporter) UltraDork
5/15/22 11:22 p.m.

You can have your bank take care of all of the paperwork, and then you can pay it off as soon as you like :).  I've done this before myself. 



ae86andkp61 (Forum Supporter)
ae86andkp61 (Forum Supporter) Dork
5/16/22 12:09 a.m.

I did it once with good results. We met at his bank (I had full amount in cash,) and they crunched all the numbers, took my money which he and I had agreed upon, paid out whatever amount he was due after the loan balance to him as the seller, and signed the title over to me. Took a while of waiting around at the bank, but I think we both left happy in the end. 

ae86andkp61 (Forum Supporter)
ae86andkp61 (Forum Supporter) Dork
5/16/22 12:13 a.m.

Actually, I just realized I've actually done it twice. The other time the seller and I realized we bank at the same credit union, so it was so easy that I forgot about it. We met at the credit union, let them know the terms of the deal, signed some paperwork, once again some numbers were crunched, some electrons flew around in space, his loan was paid off, and all of the sudden I had a new motorcycle and new loan payment. Easy as pie. Once I paid it off, the bank sent me the title.

ea_sport Reader
5/16/22 7:06 a.m.

In reply to ae86andkp61 (Forum Supporter) :

I wish his lender had a local branch..it's an internet financing company.

Steve_Jones Dork
5/16/22 8:12 a.m.

In reply to ea_sport :

His bank doesn't matter, do it at yours, and take a loan. They do all of the paperwork and deal with paying his loan off. You don't need to take the loan for the full amount, just enough to make it worth it to them. 

Loweguy5 HalfDork
5/16/22 9:42 a.m.

Be careful with a "finance company" rather than a mainstream auto lender with regard to accepting your payoff.  The way you phrased it inclines me to think the seller may have challenged Credit.  If so, make sure you understand any payoff fees or up front interest he or she may have committed to.

I agree with the others, use a lender at your end, but with a twist.  I highly recommend a local credit union.  Because they work on behalf of their members, you are likely to get even more special attention on the matter and have a human you can always get in contact with.  I'm biased though, as I worked for national auto lenders for many years but now help operate a huge auto lending program in a credit union in CT (only CT residents, sorry!)

Good luck with the purchase!

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