Paying Cash For A Financed Car

[maesai]

I am interested in buy a used car from a private party. The car is currently financed. I want to pay cash for it, as I can not buy on credit. What is the procedure for for making payment and transferring title in this situation?

Cheers.

[Jebhead]

Here is what i would do -

Go to the finance company with the owner of the car who has the debt, pay the balance, get the car papers in your name and then pay the balance to the person selling the car. That way you know that the debt is paid and no comeback to you.

JH

[BangkokImages]

This is a trust issue. Even if you only pay the balance of the loan, there is still nothing to stop the guy from selling the same car free and clear to someone else. The finance company will not put it in your name to protect you just because you paid the balance. Possession is key of course, but nothing to stop a guy with another key from driving it away from your driveway. It's his until the paperwork says its yours.

If the private party is not Thai, then he'll need a certificate of residency to pay off the loan and another to sell the car (put in your name), and you'll need a CR to title/register it in your name as well.

If the guy has the owners book things are much more clear, providing you know how to verify the owners book as genuine and unaltered.

Nothing is sacred in this country, not from Thai's and not from farangs. The last two times I sold a car I didn't turn over the blue book and keys until after we both made a trip to the bank and the bank told me their cash wasn't fake.. Paranoid? Perhaps..

[jcon]

This is a trust issue. Even if you only pay the balance of the loan, there is still nothing to stop the guy from selling the same car free and clear to someone else. The finance company will not put it in your name to protect you just because you paid the balance. Possession is key of course, but nothing to stop a guy with another key from driving it away from your driveway. It's his until the paperwork says its yours.

If the private party is not Thai, then he'll need a certificate of residency to pay off the loan and another to sell the car (put in your name), and you'll need a CR to title/register it in your name as well.

If the guy has the owners book things are much more clear, providing you know how to verify the owners book as genuine and unaltered.

Nothing is sacred in this country, not from Thai's and not from farangs. The last two times I sold a car I didn't turn over the blue book and keys until after we both made a trip to the bank and the bank told me their cash wasn't fake.. Paranoid? Perhaps..

What are you going on about? Wrong info galore.

The owner of the financed car won't have the blue book - the finance company will. And of you have the buy/sell paperwork (you can get it anywhere) and you go to the finance company with that agreement and the cash to pay the balance, then the finance company puts your name in the blue book and gives it to you. Period. The end. This can be done in fewer than 30 mins.

Source: non-paranoid experience

[janverbeem]

This is a trust issue. Even if you only pay the balance of the loan, there is still nothing to stop the guy from selling the same car free and clear to someone else. The finance company will not put it in your name to protect you just because you paid the balance. Possession is key of course, but nothing to stop a guy with another key from driving it away from your driveway. It's his until the paperwork says its yours.

If the private party is not Thai, then he'll need a certificate of residency to pay off the loan and another to sell the car (put in your name), and you'll need a CR to title/register it in your name as well.

If the guy has the owners book things are much more clear, providing you know how to verify the owners book as genuine and unaltered.

Nothing is sacred in this country, not from Thai's and not from farangs. The last two times I sold a car I didn't turn over the blue book and keys until after we both made a trip to the bank and the bank told me their cash wasn't fake.. Paranoid? Perhaps..

When I see the title under your username I assume you have a business in Thailand.Then when I see your post,all I can do is wishing you good luck with your business because you gonna need it.

[BangkokImages]

This is a trust issue. Even if you only pay the balance of the loan, there is still nothing to stop the guy from selling the same car free and clear to someone else. The finance company will not put it in your name to protect you just because you paid the balance. Possession is key of course, but nothing to stop a guy with another key from driving it away from your driveway. It's his until the paperwork says its yours.

If the private party is not Thai, then he'll need a certificate of residency to pay off the loan and another to sell the car (put in your name), and you'll need a CR to title/register it in your name as well.

If the guy has the owners book things are much more clear, providing you know how to verify the owners book as genuine and unaltered.

Nothing is sacred in this country, not from Thai's and not from farangs. The last two times I sold a car I didn't turn over the blue book and keys until after we both made a trip to the bank and the bank told me their cash wasn't fake.. Paranoid? Perhaps..

What are you going on about? Wrong info galore.

The owner of the financed car won't have the blue book - the finance company will. And of you have the buy/sell paperwork (you can get it anywhere) and you go to the finance company with that agreement and the cash to pay the balance, then the finance company puts your name in the blue book and gives it to you. Period. The end. This can be done in fewer than 30 mins.

Source: non-paranoid experience

Sigh.. okay then, baby steps.

Of course the finance company has the blue book. Did we really need to clarify that? I think not.

The finance company will not be interested in nor will they honor any "buy/sell paperwork" agreed to between the seller of the car and the new buyer. Their business is with the person on their contract. The finance company will not put the new owners name in the blue book, they will have nothing to do with the new owner. This is so basic I can't believe it's even being discussed.

When the loan is satisfied, whoever pays it, the blue book will be returned to the original owner AFTER certain requirements are met and after a visit to the Land Transportation Office which they'll usually claim will take ten working days. To transfer the title in the blue book at the LTO office, the LTO will require a copy of the original buyers house book if Thai, or a CR if farang. Once this paperwork is completed the blue book is returned to the original owner. At this point he can do with it as he wishes.

Now admittedly, I've only been through this process twice, and in Bangkok. It's possible other arrangements could be made, but the finance company is not legally bound to do so and it wouldn't be legal if they did.

[BangkokImages]

This is a trust issue. Even if you only pay the balance of the loan, there is still nothing to stop the guy from selling the same car free and clear to someone else. The finance company will not put it in your name to protect you just because you paid the balance. Possession is key of course, but nothing to stop a guy with another key from driving it away from your driveway. It's his until the paperwork says its yours.

If the private party is not Thai, then he'll need a certificate of residency to pay off the loan and another to sell the car (put in your name), and you'll need a CR to title/register it in your name as well.

If the guy has the owners book things are much more clear, providing you know how to verify the owners book as genuine and unaltered.

Nothing is sacred in this country, not from Thai's and not from farangs. The last two times I sold a car I didn't turn over the blue book and keys until after we both made a trip to the bank and the bank told me their cash wasn't fake.. Paranoid? Perhaps..

When I see the title under your username I assume you have a business in Thailand.Then when I see your post,all I can do is wishing you good luck with your business because you gonna need it.

I thank you for your good wishes. Much appreciated.

But if you think knowing the legalities of doing business, or being careful so you don't get passed a bad bank check or a pile of counterfeit bills when we all know both are serious and common issues in Thailand would in any way impede business.. well.. that's probably why I'm the one whose name is on the business.

[BangkokImages]

To the OP. There have been several threads on this subject in the recent past with good information from people who have actually went through the process. You will find some good information in these threads.

Beware of anyone who tells you 'buy/sell paperwork' between you and the seller is legally binding. Unless a lawyer is involved and it's all properly done, it's not. And only then after who knows how long in court.

You can choose to trust the guy and I'm sure many do, but understand the risks.

[maesai]

I have searched pretty thoroughly, but couldn't find any threads on this subject. If anyone can point me to them, that would be appreciated.

If I understand this correctly, there is a period of risk from the time I pay off the loan at the finance company to the time we transfer the title to my name at the transport office?

I believe the sales price is about equal to the outstanding loan.

[BangkokImages]

I have searched pretty thoroughly, but couldn't find any threads on this subject. If anyone can point me to them, that would be appreciated.

If I understand this correctly, there is a period of risk from the time I pay off the loan at the finance company to the time we transfer the title to my name at the transport office?

I believe the sales price is about equal to the outstanding loan.

Here is one where it was discussed and there are a few others. The threads might not be exactly about this subject, but it bleeds through. You'll need to look for them.

But yes, you would risk any money provided for any purpose where the blue book is not immediately available and forthcoming.

The original loan contract is between the loan company and the original purchaser. The loan company doesn't care who pays off the loan, but legally they're required to return the blue owners book to the original purchaser regardless of who paid off the loan. To do otherwise opens them up for liability and a responsible business will not do this. This means you'd have to trust this person to then sign over the owners book to you.

I tend to trust people, but you're probably talking a significant sum of money to pay off this loan. It's usually quoted to take ten working days from the day you pay off the loan, until the loan company closes the contract, takes the blue book to the LTO for the ownership change, and returns it to the original owner. Ten working days where this person could disappear, leave the country, sell the same car to other people (one guy was discovered to have sold the same car to 5 people under the same circumstances and it wasn't even his car, he was looking after it for another farang who was out of the country! The 'loan officer' he took them too collected their written 'agreements', but never processed anything. They kept the money.), wreck the car, drive the car out of your driveway, or many other possibilities.

Unfortunately there are many westerners out there scamming other westerners. There are fake bank checks, counterfeit currency, and any number of scams. The one thing they'll all have in common, is that once the cash/property leaves your possession you're very unlikely to recover even part of it.

Good luck.

[NanLaew]

If you have a 'yellow book' aka aliens tibian bahn, you won't need a certificate of residence to do any vehicle transactions.

[NanLaew]

Internet fart... double post

Edited March 31, 2011 by NanLaew

[maesai]

I completed the transaction today. Met the seller at the finance company. I paid off the outstanding loan. The finance company filled out all the transfer papers and handed me the reg book. Went to the transport office with the seller, had the vehicle inspected. I gave the seller the remaining funds and we transfered the the title to me. The seller paid the transfer fees. All very easy, actually.

[BangkokImages]

I completed the transaction today. Met the seller at the finance company. I paid off the outstanding loan. The finance company filled out all the transfer papers and handed me the reg book. Went to the transport office with the seller, had the vehicle inspected. I gave the seller the remaining funds and we transfered the the title to me. The seller paid the transfer fees. All very easy, actually.

First, I'm glad it went well. That's the main thing.

I'm curious about a few specifics as my finance company would not do certain things and I ended up paying it off before selling..

What exactly were the 'transfer papers'? Were these papers transferring the title from them to the original purchaser (the guy on the contract), or did they provide legal papers allowing transfer to you at this point? If the former the registration book shouldn't have been handed to you though I can understand why it may have happened. If the former, that would be a nice service and perhaps you could post a redacted copy of the form others could use? This is what I asked for (twice, two separate finance companies) and was told they didn't provide.

So.. the actual title was transferred to you at the LTO.. nice you didn't need to wait and could go there directly. This is the other part I asked about (twice) and was told they had to do it.. Did you have any legal paperwork showing you owned the car prior to the LTO?

Curious what finance company?

[maesai]

First, I'm glad it went well. That's the main thing.

I'm curious about a few specifics as my finance company would not do certain things and I ended up paying it off before selling..

What exactly were the 'transfer papers'? Were these papers transferring the title from them to the original purchaser (the guy on the contract), or did they provide legal papers allowing transfer to you at this point? If the former the registration book shouldn't have been handed to you though I can understand why it may have happened. If the former, that would be a nice service and perhaps you could post a redacted copy of the form others could use? This is what I asked for (twice, two separate finance companies) and was told they didn't provide.

So.. the actual title was transferred to you at the LTO.. nice you didn't need to wait and could go there directly. This is the other part I asked about (twice) and was told they had to do it.. Did you have any legal paperwork showing you owned the car prior to the LTO?

Curious what finance company?

It was just the standard transfer forms, plus one additional page that looked like a power of attorney? It included the ID card from the woman at the finance company plus some other rubber stamps. They filled in the transfer forms with my name, not the sellers, at the finance company.

I didn't end up with a copy of anything to show you. It is all at the LTO, and I pick up the book on Tuesday. It was a small local (Chiang Mai) finance company located in Hang Dong. One other thing, about halfway though the process at the LTO, one of the girls from the finance company showed up to check everything was going according to plan, which it was.

[BangkokImages]

First, I'm glad it went well. That's the main thing.

I'm curious about a few specifics as my finance company would not do certain things and I ended up paying it off before selling..

What exactly were the 'transfer papers'? Were these papers transferring the title from them to the original purchaser (the guy on the contract), or did they provide legal papers allowing transfer to you at this point? If the former the registration book shouldn't have been handed to you though I can understand why it may have happened. If the former, that would be a nice service and perhaps you could post a redacted copy of the form others could use? This is what I asked for (twice, two separate finance companies) and was told they didn't provide.

So.. the actual title was transferred to you at the LTO.. nice you didn't need to wait and could go there directly. This is the other part I asked about (twice) and was told they had to do it.. Did you have any legal paperwork showing you owned the car prior to the LTO?

Curious what finance company?

It was just the standard transfer forms, plus one additional page that looked like a power of attorney? It included the ID card from the woman at the finance company plus some other rubber stamps. They filled in the transfer forms with my name, not the sellers, at the finance company.

I didn't end up with a copy of anything to show you. It is all at the LTO, and I pick up the book on Tuesday. It was a small local (Chiang Mai) finance company located in Hang Dong. One other thing, about halfway though the process at the LTO, one of the girls from the finance company showed up to check everything was going according to plan, which it was.

Sounds great. Handling it all in one day would have alleviated a lot of my fears as well. I'm glad it worked out.