car liens
Fine Points of the Law: Former car owners find out they still own them
Only some of the 50 states protect ya if ya trade in to a dealer a car that ya still owe money on. The dealer "agrees" to pay off your loan and then resells the car. In the states without protective laws (California!), if the dealer hasn't yet paid it off and then files for bankruptcy, the owner of the car is still you, and the lienholder expects you to continue your payments you thought the dealer had bought your way out of (along with your payments on the new car that the trade-in was part of). Sur-prise! Associated Press via KOVR-TV (Sacramento)
Only some of the 50 states protect ya if ya trade in to a dealer a car that ya still owe money on. The dealer "agrees" to pay off your loan and then resells the car. In the states without protective laws (California!), if the dealer hasn't yet paid it off and then files for bankruptcy, the owner of the car is still you, and the lienholder expects you to continue your payments you thought the dealer had bought your way out of (along with your payments on the new car that the trade-in was part of). Sur-prise! Associated Press via KOVR-TV (Sacramento)
Comments
That happened here in Florida not too long ago. A dealer in Lakeland was caught after he sold and didn't pay off several higher end trade-ins.
Posted by AGFH on 02/04/09 at 11:06 AM
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