Automotive

Lien on Used Car Bought from Dealer

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  • Jul 19th, 2011 8:49 pm
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Member
Apr 10, 2010
233 posts
10 upvotes
Toronto

Lien on Used Car Bought from Dealer

I bought a 07 VW Passat from a used car dealer (Canadian Find Motors) on Sunday. Although I'm going to pay and pick-up the car today, I'll register the car when I get my G license, which will be in a couple of weeks. I bought a UVIP package and it indicates that there is 1 lien registered against this vehicle, with the secured party being VW Credit Canada Inc. The dealer told me that it used to be a lease. So is this normal? Should I worry about the lien? I don't want to pay a bunch of money for the car, then pay a bunch of money again for the lien.
19 replies
Deal Addict
Apr 22, 2009
1058 posts
50 upvotes
London ON
when you go pay for the car make sure its written somewhere that the dealer will use the money he receives to pay off the lien within a week or the contract is void

if you pay for the car, register it with a lien then you are responsible and payments wont be made and your credit will be ruined and they will come back to get the car you just bought
Deal Addict
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Aug 27, 2004
2225 posts
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Paris, France
jordanr1987 wrote: when you go pay for the car make sure its written somewhere that the dealer will use the money he receives to pay off the lien within a week or the contract is void

if you pay for the car, register it with a lien then you are responsible and payments wont be made and your credit will be ruined and they will come back to get the car you just bought

Taken from the OMVIC website:
Registered dealers are required to clear liens prior to sale.
In other words, it's the dealer's responsibility to clear the lien. I wouldn't take possession until that happens, especially if the dealer is trying to convince you to. Involve the OMVIC if you feel you're not getting anywhere with the dealer.
Member
Apr 10, 2010
233 posts
10 upvotes
Toronto
jordanr1987 wrote: when you go pay for the car make sure its written somewhere that the dealer will use the money he receives to pay off the lien within a week or the contract is void

if you pay for the car, register it with a lien then you are responsible and payments wont be made and your credit will be ruined and they will come back to get the car you just bought
What's weird is that the UVIP doesn't say the amount of the lien
Deal Addict
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Dec 2, 2003
2936 posts
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Peterborough, ON
D-3vil wrote: Taken from the OMVIC website:


In other words, it's the dealer's responsibility to clear the lien. I wouldn't take possession until that happens, especially if the dealer is trying to convince you to. Involve the OMVIC if you feel you're not getting anywhere with the dealer.
+1

I agree. This sounds highly irregular for a dealer to do this, but then again I"m at a major brand and not a small dealer so I wouldn't know. I would wait till the Lien is clear as well. However, if you insist on going ahead with the deal so you don't risk losing the car, then I'd get something in writing written on the bill of sale giving you an out.

Don't have the car registered to you until the Lien is cleared!
Tung(Tom)Nguyen
Member
Apr 10, 2010
233 posts
10 upvotes
Toronto
D-3vil wrote: Taken from the OMVIC website:


In other words, it's the dealer's responsibility to clear the lien. I wouldn't take possession until that happens, especially if the dealer is trying to convince you to. Involve the OMVIC if you feel you're not getting anywhere with the dealer.
OK, I just called the dealer, and they say that the Ministry of Transportation's lien information is not up-to-date. They'll also write on the bill of sale a guarantee that the car is lien-free.
Deal Addict
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Oct 26, 2007
1668 posts
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Toronto
What about calling VW Credit Canada to get the most up to date information on the lien?
Deal Addict
Apr 22, 2009
1058 posts
50 upvotes
London ON
from mto website:
[QUOTE]Buyers

Did you know?
If the lien is not paid, the secured party (debt holder) can repossess the vehicle from the person who owes the money or from the buyer of the vehicle.
If there are debts registered in Ontario on the vehicle, the lien information will tell you:
The name and municipality of the person who owes the money. If a business owes the money, the package will have the full street address
The name and address of the lender (the secured party)
The place where the debt is registered
The amount of the debt
Note: The lien information on a UVIP may not be current. The date shown on the package is usually two days behind

The package lists previous owners as debtors
Contact each lender to get an update on the debt
If the debt was paid, ask the lender to clear the debt

If the debt is not paid, it continues against the vehicle until it is paid. The lender can also take back the vehicle at any time

The debt is paid and the lender has not cleared it:
The lender must register a clearance within 30 days
If the lender has not registered a clearance, you can write a notice to the lender requiring them to pay you - $500 and any damages resulting from not clearing the debt
The Ministry of Government Services, Personal Property Security Branch removes a clearance registration within 60 days[/QUOTE]
Member
Apr 10, 2010
233 posts
10 upvotes
Toronto
Broli's Mom wrote: What about calling VW Credit Canada to get the most up to date information on the lien?
Just called VW Credit Canada. There is still a lien against the car, and they say the lien information is up-to-date.
Deal Addict
Apr 22, 2009
1058 posts
50 upvotes
London ON
NirvanaFC wrote: Just called VW Credit Canada. There is still a lien against the car, and they say the lien information is up-to-date.

call the dealer with this info and see what they have to say

sounds like you should try and deal private or find another dealership
Member
Apr 10, 2010
233 posts
10 upvotes
Toronto
Jeff-TheBiz wrote: I wouldn't pick up the car until the dealership can provide a lien release letter from VW Credit Canada.
Called the dealer. They say that they have the lien release letter, and they'll show the letter to me when I pick-up the car today. They'll also write on the bill of sale that I will not be required to pay for any lien. Will that protect me from having to pay the lien in the future?
Deal Addict
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Apr 12, 2007
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Mazda of Toronto
NirvanaFC wrote: Called the dealer. They say that they have the lien release letter, and they'll show the letter to me when I pick-up the car today. They'll also write on the bill of sale that I will not be required to pay for any lien. Will that protect me from having to pay the lien in the future?

show you the letter???

I hope this means you get a copy.

I would get a copy and confirm it prior to pickup.
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Member
Apr 10, 2010
233 posts
10 upvotes
Toronto
Jeff-TheBiz wrote: show you the letter???

I hope this means you get a copy.

I would get a copy and confirm it prior to pickup.
OK, thank you all for your help.
Deal Expert
Mar 23, 2004
35606 posts
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One of my general rules is not to buy a car from a place with "fine cars" or "fine motors", or "fine" anything in the name.
Deal Expert
Aug 2, 2001
18944 posts
10527 upvotes
NirvanaFC wrote: Called the dealer. They say that they have the lien release letter, and they'll show the letter to me when I pick-up the car today. They'll also write on the bill of sale that I will not be required to pay for any lien. Will that protect me from having to pay the lien in the future?

You have to look at the whole picture.

Will having a bill of sale indicating the lien will be handled by a dealer satisfy a judge in small claims court? Possibly.
Will having a vehicle with a lien, one you are not responsible for according to a bill of sale, cause you any headaches in the future if the lien is not cleared? Possibly.


The question is, do you want the potential headaches in the future while you attempt to prove you aren't responsible for the lien while you drive the collateral for that lien? Do you want to attempt to resell it in 5 years (when the lien hasn't been dealt with) and go through all this? It's not whether you are responsible, it's whether you want the potential headache to deal with it.
Newbie
Jul 4, 2011
49 posts
4 upvotes
Earth
Run away fast. This deal stinks of fraud. A letter will not protect you against a lien. The title must be clear end of story.
Deal Fanatic
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Jun 7, 2001
7994 posts
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Alberta
MrSnazzyDeals wrote: Run away fast. This deal stinks of fraud. A letter will not protect you against a lien. The title must be clear end of story.

It's probably too late since the OP said he bought the car already. Not sure how much $$ has been paid...I wouldn't pay a dime more until the title is clear of all liens.

Dave
Member
Apr 10, 2010
233 posts
10 upvotes
Toronto
Called the dealer again. They said they have contacted VW Credit Canada to clarify the situation and have received a clearance letter in fax. I called VW Credit again, and VW said the lien will get cleared in a couple of weeks. Hopefully, this is the end of the whole lien trouble. I'll go pay and pick-up the car after work today.
Deal Fanatic
Apr 16, 2007
8134 posts
3485 upvotes
Financial District B…
NirvanaFC wrote: Called the dealer again. They said they have contacted VW Credit Canada to clarify the situation and have received a clearance letter in fax. I called VW Credit again, and VW said the lien will get cleared in a couple of weeks. Hopefully, this is the end of the whole lien trouble. I'll go pay and pick-up the car after work today.

Liens that show up on vehicles for sale from most used car lots and new car lots are usually the result of administration errors and/or the financial institutions tardiness.
When a used car dealer acquires a vehicle from the auction they are as vigilant as you the buyer in making sure there's no liens on the car. The dealer probably called VW Credit about the lien and VW probably said yes we will release the lien on it but forgot to do it. VW must contact the PPSA and have the lien removed. That usually takes a few days on PPSA's end. Dealers supply a letter of lien release to you or whomever is buying the vehicle just to expedite the process.
The fault here is not the dealer but rather VW Credit dragging their feet.

A couple weeks to have the PPSA cleared is totally unacceptable. It takes less than 5mins to write down your VIN on the PPSA form and fax it to them. They will probably forget to do it again.

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