What Happens When You Buy A Car With Outstanding Finance On It
Leading UK lenders such as NowLoan are often asked about car finance. More of us than ever before are buying cars using some form of finance option.
In the past, most borrowers turned to their local high street bank to borrow money for a car purchase. However, things have changed. Independent lenders are now more likely to offer you a better finance deal than traditional lenders even if you have bad credit now Lenders can offer an array of loans for bad credit such as guarantor loans. Shop around before you sign on the dotted line of any loan agreement.
Buying a used car can be fraught with problems. First of all, you need to check out that the car is mechanically sound. To do so, you can turn to organisations such as the AA and RAC and ask for an inspection. Of course, this is a really important part of the buying process. But, so is checking the car you are about to buy is finance free.
What Happens When A Car Has Outstanding Finance On It?
If finance is still owing, the car does not belong to you, it belongs to the finance company. You may have bought it in good faith, but you have taken on the debt of the previous owner. Will the finance company ask you for the money? Yes, the finance company will expect you to pay off the outstanding debt.
When you have already paid for the car, you may have to go to court to recover the debt that you have intentionally taken on. This is an expensive process and you should always check all previous finance for the car has been paid off.
Make Sure You Carry Out A Vehicle Check
Before you hand over any cash, you should make sure that you carry out a vehicle check.
What is a vehicle check? A vehicle check will give you crucial information about the car you are about to buy. In short, a vehicle check is worth its weight in gold. A qualified company will check things such as finance, license plates, recorded mileage and if the vehicle has been stolen. Crucially, a vehicle check will also let you know if the vehicle has been written off.
You may be surprised, but there are still unscrupulous people and dealers out there who will try to sell you a vehicle that has been involved in a serious accident and subsequently written off.
Should you come across unpaid finance, you can ask the owner to pay it off and provide you with proof that he or she has done so. Once you have received the paperwork, you should do another check to make sure the finance has indeed been paid off.
Buying A Car From A Dealership
It is often safer to buy your car from a dealership. Standards are pretty strict, and if you have a problem, you can turn to Trading Standards and ask for help. Most legal car dealerships make sure finance is settled before they accept the vehicle in part exchange or agree to sell it. Still, you should always make sure there is no finance outstanding.
Don’t get pressurised into accepting a finance deal from a dealership. Independent lenders such as NowLoan can often help you to find the right car loan for you.