December 8, 2022

Is There a Lien Against Your Used Car?

You can be excited about your decision to own a car, even though it means a used car. But that doesn’t matter because buying a pre-owned vehicle can be financially wise. And many times, you get such amazing deals that paying a high price for a new model may feel crazy. That’s why you come across various dealerships trying to lure customers through customer service and offerings. However, you cannot let your guard down before ensuring it is a practical choice. While it all depends on your financial status, mental makeup, circumstances, and needs, used cars are in demand right now, and COVID has been one of the top contributors to this change. 

In this context, you need to verify multiple things, one of which can be the lien status. Liens are registered claims against a property, such as a used car, RV, or boat. The creditors (garages or lending institutions) place these on vehicles for the property owners to clear. If you buy a used car with a lien, the proceeds from the sale go off to the outstanding debt to repay the creditor. Liens can also apply if there are any unpaid taxes against the property.

 A lien will be applicable until and unless the owner has paid the total amount to the lender. You also need to know that multiple debts can run on a used car. Hence, you have to be wary about this. You can learn about this status by obtaining vehicle identification number (VIN). If you live in Calgary, Alberta, you can use The Personal Property Registry (PPR) services to get the details for a small fee. Sometimes, a car can have a registry in different locations. In that case, you can seek lien-related information from your dealership or buy a report of vehicle history that gives an insight into lien searches covering different territories. So, keep this in mind when you talk to used car dealers Calgary and area

The detailed report can also reveal things like open recalls, services done, damages, accidents, and registration. You can expect them to give information on things that even the dealer may not be aware of, which rarely happens. Usually, a seller informs the potential buyer about the lien status, but you can also verify it. Reputable agencies can help you with that. As mentioned, there can be fees, and if you seek a bigger organization for information, the amount will also be more significant. Nevertheless, it can be worth taking this step because they tend to be pretty elaborate.  

Why do you need to look into liens?

Regardless of where you get a used car from a dealership or private seller, you must ensure that the vehicle doesn’t have any lien running. A registered dealer will handle this at their end. Still, don’t forget to inquire into this. And if you see the car still has a lien, do away with it before getting the ownership or registering the same in your name in the territory. However, you cannot take things for granted, especially when dealing with a private party. You don’t want to manage unwanted interest rates. 

How do you avoid the issue of lien on your used car for good?

When you buy a used car, you don’t want it to do anything with its past – not a lien. You will have to learn about the lien status, which can take a few days. It can involve a bit of expense also. Nevertheless, take this matter up with the dealer. Ask the sales guy if the car has any lien. As mentioned, dealers usually take care of this part. They pay the debt. However, if you approach a private party, you can ask for proof to show that there is no active loan against the vehicle. Some standard documents include a letter confirming full payment or a cancelled check.

The seller must clear the loan before you get it registered in your name. If you want to be sure, talk to the lender directly to learn about the situation. If no loan is pending, the province’s governing body will also have an updated record. You can reach out to them also for help. They will guide you through this. You want to ensure that you don’t have to pay any interest on the car, and the documents establish this. Purchasing a lien-free vehicle can reduce stress and make your buying experience far more enjoyable and hassle-free. 

However, this is just one of the aspects. You have to be thorough with everything to make your car purchase safe. There are things like pre-purchase inspection, test drive, and many others. Once you have paid and driven your vehicle home, you will not have much to do. Hence, if you are careful from the beginning, the main concerns and obstacles will get eliminated soon. Later, you can focus on your daily life and car.

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