*Buying A Bike That's Still Financed*

[slowpoke]

Ok, I've seen one too many of these threads flying around the General section. A quick search can do wonders.

This is what I did. There are other ways to do this, but I wanted to cover my ass legally. How you proceed is ultimately up to you.


Okay, this is what you can do:

1. He can payoff the loan so he can have title in hand and then you pay him. But since he's still making payments, then I doubt he has all the money.

2. You can write a check for the amount owed to the finance company with a note saying to send the title to you. DO THIS AT YOUR OWN RISK!!!

3. Go to the DMV and get forms: VEHICLE/VESSEL TRANSFER AND REASSIGNMENT FORM (REG 262) & APPLICATION FOR DUPLICATE TITLE (REG 227) And you will need the TRADE-IN PAY-OFF ADJUSTMENT. I'm not sure where to get the last one (DMV maybe), but I got it through my local Honda dealer (Mission Honda in Daly City)

Okay, the TRADE-IN PAY-OFF is the most important. It goes to the finance company, along with a check for the amount due to the finance company (bank, credit union, Honda Finance, etc.) that states that YOU are paying off the loan and that the registration should be sent to YOU (which was kinda crap cause they still sent the registration to the seller). There's other copies that go the the DMV (release of liability), buyer, seller. This form is so that you are LEGALLY COVERED. Remeber, you are writing a check to the finance company, NOT THE SELLER!

VEHICLE/VESSEL TRANSFER AND REASSIGNMENT FORM is when you get the registration from the finance company, you can go register the bike into your name without going back to the seller or if he decides to call the bike stolen. THIS FORM GIVES YOU POWER OF ATTORNEY OVER THE VEHICLE. No need to go back to the seller and fill out the back of the title.

APPLICATION FOR DUPLICATE TITLE This is for in case you get an electronic registration. First off, 99% of the time the finance company does not have the title in hand. It's held at another facility in another state. So it might take 4-6 weeks to get it. And they might send you an electronic registration which mean that they send you a piece of paper saying the title is in the computers at DMV(also known as a "paperless registration"). That's why you need this form in case you get a "paperless registration". To get a hard copy of the registration. DMV won't give you shit without this form filled out by the seller and if you don't have it, you don't get to register the bike into your name.

Even if the finance company sends the title back to the seller by mistake, you're still legally covered with all the paperwork in hand. Seems like a pain in the ass, but the key thing is that YOU MUST BE LEGALLY COVERED BEFORE YOU SEND ANY $$$ OUT! Hopefully he's cool and he'll call you and let you know that they sent him the title. If that's the case, just fill out the back of the "pink slip" and disregard all the previous forms (forms are a safeguard in case you don't get the registration). Make sure you make copies of ALL FORMS before you send it out. Also, once the check is in the mailbox (he can mail it himself if that'll make him feel better) take the bike with you. You won't have the registration, but you will have the bike and all the legal papers in hand in case he does get the title and decides not to call and try to dick you.

If you need help, I suggest going to Mission Honda/Yamaha in Daly City and asking them (especially for the TRADE-IN PAY-OFF ADJUSTMENT form).


kthxbye...

 

[MackeyStingray]

moved to forum to keep it from getting lost

 

[slowpoke]

Moved to what forum?

 

[pv1191]

Here is some finance in

First. get the payoff for the bike...IE...Have the seller call the bank while you are there. Make out a checkto the bank for that amount and send it to the bank yourself. Send it to the bank or have it withdrawn transfered via the internet. The title will be sent to the previous owner. Keep in contact and get the title when it arrives. You will not need a lost title form. This will confuse the DMV and make it harder for you when you register. Just be careful and know who you are buying from. You can still ride an insure the bike while waiting just tell the insurance company you are waiting for the title. I have done this many times and never had a problem.

 

[WillG]

You can also use an escrow service, when I sold a car that wasn't paid off, the buyer used escrow.com to complete the transaction.

 

[DongTran]

If it is a bank with a branch in your area, you can make an appointment with one of the staff members to complete the payoff + sale @ the branch.

 

[outbrakeridah]

If the title is not received yet, how can you register the bike in your name at the DMV. What forms would you need or do you just wait until you get the title to go to the DMV.

 

[ineluctablemoto]

Thank you Slow Poke. This is very helpful since I am about to buy a motorcycle from someone who is still financing his motorcycle.

Does the "Application for Duplicate Title" get sent along with the check to the finance Company? I ask because it requires a notarized signature from the lienholder.

 

[dukeryder]

If the title is not received yet, how can you register the bike in your name at the DMV. What forms would you need or do you just wait until you get the title to go to the DMV.

Yeah I'm still confused on this.

Here's the scenario I'm trying to figure out.

You buy/sell a vehicle, the Title is 2 weeks out from the bank but the new owner only has 10 days to register the vehicle in their name.

Is it possible just to sell the vehicle on a bill of sale and the the new owner can go down the DMV and register it without the title? Or can they just take that first form down to the DMV and get the vehicle registered and wait for the title to come 2 weeks later?

I've done financed vehicle sales in Louisiana before and was real easy using a Notary shop. This seems way more difficult here in CA...

 

[jthevwman]

Yeah I'm still confused on this.

Here's the scenario I'm trying to figure out.

You buy/sell a vehicle, the Title is 2 weeks out from the bank but the new owner only has 10 days to register the vehicle in their name.

Is it possible just to sell the vehicle on a bill of sale and the the new owner can go down the DMV and register it without the title? Or can they just take that first form down to the DMV and get the vehicle registered and wait for the title to come 2 weeks later?

I've done financed vehicle sales in Louisiana before and was real easy using a Notary shop. This seems way more difficult here in CA...

Just go to the DMW with the new owner and they can start the paper work. It won't be completed until you get the title. The new owner will have the starting paperwork in his name. Ive done it a few times , You will just send the new owner the pink when it comes in.

 

[dcdomain]

If it is a bank with a branch in your area, you can make an appointment with one of the staff members to complete the payoff + sale @ the branch.

So there's no wait? They just hand the title over? I might be in this situation next weekend. Just want to make sure I'm covering all my bases.

 

[davidji]

Interesting, thanks Slowpoke. The only way I've done it before (with a car), is go to the institution where the title is held, give one cashiers check to the seller, another to the leinholder (a local Credit Union), and get the title directly in exchange.

That's something that new bike buyers should consider if they might want to sell before they can pay off the bike: if they finance the purchase through a local institution (e.g. local credit union), when they want to sell, the process could be a lot simpler. This simpler process increases the number of potential buyers, thus increasing the value of the bike.

I've walked away from vehicles where I couldn't get the title directly in exchange for my money. With your process, I might consider it. If there weren't another bike or car I could buy instead. Usually there is.

 

[scootergmc]

So there's no wait? They just hand the title over? I might be in this situation next weekend. Just want to make sure I'm covering all my bases.

You need to call ahead/make appointment. Most titles are electronic from DMV when there's a lienholder (bank/CU). The bank/CU will request the paper title from DMV and that usually takes a week or so. When you meet at the institution, buyer or seller presents the payoff to the bank, the remainder (if any) to the seller, bank and seller sign off the title to the new owner, transaction complete.

At least that's how it worked for me- I've only sold a financed vehicle once.