Buying a car with money owing

[XB GS 351 Coupe]

Originally Posted by mike_nofx

This is what I was thinking.

Who would even accept an XH Ute as collateral for anything? Unless this Home loan was taken out back when the XH was relatively new.

I think if you went to a bank today with your XH as collateral they'd laugh at you

Re read the OP explains it all.

There is no home loan yet, the car was used as collateral on a loan a while back this is still outstanding.

You need to understand the OP before replying.

It's all there:

Originally Posted by last fairlane

but the seller tells me he took out a loan a couple of years back and he used the ute as collateral

and here

Originally Posted by last fairlane

as he is buying a house he is not going to default

Originally Posted by Bevsta007

Exactly, there's holes in this story.

I think the holes are in the comprehension of people replying before reading and understanding the OP

[FoxtrotGolfXray 5.0]

Originally Posted by XB GS 351 Coupe

I think the holes are in the comprehension of people replying before reading and understanding the OP

Or the other option is that the original posting is not worded as well as it could (or should) be considering he's asking for advice on a fairly technical matter and that has then allowed several people to interpret those words in different ways.

Perhaps the OP could come back on and clarify a few of the points raised so that a solution based on the correct information can be provided.

[katefactor]

Originally Posted by Yellow_Festiva

Would the REVS check also show it as stolen??? I guess that would depend on what agency is providing the info.

Iam not sure depends on what was asked, if it was just asking for incumberence then maybe not.
TBH the whole story sounds strange, I just can't imagine someone saying there is a registered interest in my vehicle but it's all good I won't default.. Then say but dont sell it to a stranger

The seller must be on drugs

[mike_nofx]

Originally Posted by XB GS 351 Coupe

Re read the OP explains it all.

There is no home loan yet, the car was used as collateral on a loan a while back this is still outstanding.

You need to understand the OP before replying.

It's all there:



and here





I think the holes are in the comprehension of people replying before reading and understanding the OP

Since you seem to be the best at comprehending this barely understandable grammar-less post and since the OP is not responding.

What does the loan from "a couple of years back" have to do with the homeloan he mentions? and why not defaulting on a future homeloan keeps the XH safe?

Originally Posted by last fairlane

Hi all long time member here last week I bought an XH ute with out rego
theres nothing wrong with the car
but the seller tells me he took out a loan a couple of years back and he used the ute as collateral
I checked with REVs and it came back as having encumberance
he told me I could register it in my name but shouldnt sell it to a stranger
as he is buying a house he is not going to default
can I register it in my name with the money still owing
if I wreck it out I still cant sell the body or motor so that doesnt leave much
thanks just wondering where I stand
Thanks John in Brisbane

[TUF_302]

I get the feeling we are not going to find out what happens here

[Silver Ghia]

Originally Posted by TUF_302

I get the feeling we are not going to find out what happens here

Maybe because he'd already bought it and he's now in a bit of a mess:

Hi all long time member here last week I bought an XH ute with out rego
theres nothing wrong with the car
but the seller tells me he took out a loan a couple of years back and he used the ute as collateral
I checked with REVs and it came back as having encumberance
he told me I could register it in my name but shouldnt sell it to a stranger
as he is buying a house he is not going to default
can I register it in my name with the money still owing

[XB GS 351 Coupe]

Originally Posted by mike_nofx

Since you seem to be the best at comprehending this barely understandable grammar-less post and since the OP is not responding.

What does the loan from "a couple of years back" have to do with the homeloan he mentions? and why not defaulting on a future homeloan keeps the XH safe?

You obviously know little about loans.

And it is quite clearly explained in the OP.

The original owner got a loan a few years ago and used the ute as security for the loan, he has now sold said ute to OP, however the ute is still encumbered by original loan which the original owner is still paying off.

He assured the OP that he will not default on the loan and told the OP that he is in the process of getting a home loan and there for will not default on the original loan, because if he did then he would be unable to get a home-loan.

All pretty straight forward.

It's all clearly explained in the OP.

[Vesper Martini]

Originally Posted by XB GS 351 Coupe

Re read the OP explains it all.

There is no home loan yet, the car was used as collateral on a loan a while back this is still outstanding.

You need to understand the OP before replying.

It's all there:



and here





I think the holes are in the comprehension of people replying before reading and understanding the OP

Take it easy

There is no lack of comprehension. do you think using an XH as Collateral on a loan as little as 2 years ago is a legitimate story?

Your interpretation of a while back is an assumption too, probably correct.
such a thing could only have been done when the old ute was actually worth something.

[XB GS 351 Coupe]

Originally Posted by Bevsta007

Take it easy

There is no lack of comprehension. do you think using an XH as Collateral on a loan as little as 2 years ago is a legitimate story?

Your interpretation of a while back is an assumption too, probably correct.
such a thing could only have been done when the old ute was actually worth something.

My guess is it would have been longer that two years ago.

No one knows what the loan is/was for, may be it was a loan for the actual ute. May be it was for a holiday and the ute was used as collateral for a smallish loan that the original owner is paying off at $20 per month.

Who knows, the OP probably doesn't even know.

What is a nice neat XH ute worth these days?? I don't really know, never looked at them.

[SYZ]

Originally Posted by last fairlane

Hi all long time member here last week I bought an XH ute with out rego

This is your first mistake, but I'm guessing it's too late to back out now as there's no "cooling off" period with a private sale.

I checked with REVs and it came back as having encumberance

Again a major no-no. You should never by an encumbered vehicle under any circumstances.

he told me I could register it in my name but shouldnt sell it to a stranger as he is buying a house he is not going to default

How can you be sure he's not gonna default? If he does, you lose the vehicle—and your money. And no home lender would accept a $2000 vehicle as collateral anyway. I'm guessing this bloke is pulling some sort of scam.

The whole story he's pushing sounds like a fairy tale. I'd suggest contacting QLD Fair Trading, Tel: 13 74 68 or [https://www.qld.gov.au/law/fair-trading/] tomorrow and find out the legalities of this arrangement and where you stand if you've already handed over the money.

Good luck.

[SYZ]

[double post]

[maat1985]

to me it reads as this:

"Hi all long time member here last week I bought an XH ute with out rego"
(purchased unregistered xh ute 1 week ago)
"theres nothing wrong with the car "
(car is in great condition)
"but the seller tells me he took out a loan a couple of years back and he used the ute as collateral"
(a couple of years back this ute was used as collateral on a loan)
"I checked with REVs and it came back as having encumberance"
(this confirms that)
"he told me I could register it in my name but shouldnt sell it to a stranger"
(seller told me that i would have no problem registering it but dont onsell it)
"as he is buying a house he is not going to default"
(he will be getting a home loan so cant afford to default on original loan)
"can I register it in my name with the money still owing"
(can i put rego oni it??)
"if I wreck it out I still cant sell the body or motor so that doesnt leave much"
(if i scrap it can i make some cash?)
thanks just wondering where I stand
(please help i am unsure of what i just did)
Thanks John in Brisbane
(cheers mate)

assumptions are that the loan must have only been a small amount and collateral of the ute was used to either reduce interest or because the previous owner had bad credit history and was trying to make it better.
which makes me think that he is probably not the most reliable person with money to start with.
if someone was in a financial position to buy a house why would they have a loan with an XH as collateral??
1. either a small loan (why need to borrow a small amount if can afford to buy house??)
2. had bad credit history (more likely to default)

basically it sounds to me like the seller is probably not a rleiable person financially.
and it also sounds like the OP is probably very impulsive

[mike_nofx]

Originally Posted by XB GS 351 Coupe

You obviously know little about loans.

And it is quite clearly explained in the OP.

The original owner got a loan a few years ago and used the ute as security for the loan, he has now sold said ute to OP, however the ute is still encumbered by original loan which the original owner is still paying off.

He assured the OP that he will not default on the loan and told the OP that he is in the process of getting a home loan and there for will not default on the original loan, because if he did then he would be unable to get a home-loan.

All pretty straight forward.

It's all clearly explained in the OP.

I do know little about loans yes as I prefer to pay cash for things rather than use $2000 Utes as collateral. I do however have a $400k home loan.

So please educate me here, once old mate gets his home loan approved what is then to stop him defaulting on the original loan to which the XH is collateral?

[fordomatic]

where is the OP, would be good to actually see him reply to his thread

[Express]

Originally Posted by XB GS 351 Coupe

He assured the OP that he will not default on the loan and told the OP that he is in the process of getting a home loan and there for will not default on the original loan, because if he did then he would be unable to get a home-loan.

All pretty straight forward.

It's all clearly explained in the OP.

Yep got it, a smart person would wait until after they got the home loan before defaulting on the original one.

The other one I always believe is when they tell me they're a motivated seller because they're moving overseas.

I'm not saying everyone's dishonest as most people are not but when encumbrance is involved at least expect the worst as part of the decision making process.

[Shonky.]

Originally Posted by mike_nofx

I do know little about loans yes as I prefer to pay cash for things rather than use $2000 Utes as collateral. I do however have a $400k home loan.

So please educate me here, once old mate gets his home loan approved what is then to stop him defaulting on the original loan to which the XH is collateral?

I don't think XBGS was vouching for the validity of the assumptions made by OP, he was simply explaining the story to you from his more accurate reading of the post

[Vesper Martini]

Originally Posted by XB GS 351 Coupe

My guess is it would have been longer that two years ago.

No one knows what the loan is/was for, may be it was a loan for the actual ute. May be it was for a holiday and the ute was used as collateral for a smallish loan that the original owner is paying off at $20 per month.

Who knows, the OP probably doesn't even know.

What is a nice neat XH ute worth these days?? I don't really know, never looked at them.

So we agree, the story has holes in it

[Shonky.]

what does it matter what the purpose of the loan taken against the ute was?

we also don't know what colour carpet is in the ute, but in the same way it is irrelevant to the OPs questions

I suspect the OP has not returned cause he's seen how the thread is going

If you don't know anything about the topic, why jump in and dilute the decent info that has been posted by those who do???

[Vesper Martini]

Originally Posted by Shonky.

what does it matter what the purpose of the loan taken against the ute was?

The value is important

[XB GS 351 Coupe]

Originally Posted by Shonky.

I don't think XBGS was vouching for the validity of the assumptions made by OP, he was simply explaining the story to you from his more accurate reading of the post

Originally Posted by Shonky.

what does it matter what the purpose of the loan taken against the ute was?

we also don't know what colour carpet is in the ute, but in the same way it is irrelevant to the OPs questions

I suspect the OP has not returned cause he's seen how the thread is going

If you don't know anything about the topic, why jump in and dilute the decent info that has been posted by those who do???

a person who actually reads and understands what is being said

[last fairlane]

Hi all Im back at last
Thanks for all the comments though some missed my point a bit
maybe it was my way of getting the story across

well I contacted "legal aid" and was told a few things

if I registered the car in my name it would bring up a "red flag"
to the finance company and they could come and repo it
wether he was arrears or not

anyway I rang the seller and told him what I had found out
and he agreed to refund my money and call it quits
tonight he came to my place with the cash and took the car on a trailer

so alls well that ends well

thankyou for all your comments and suggestions
thanks again John

[fordomatic]

Originally Posted by last fairlane

Hi all Im back at last
Thanks for all the comments though some missed my point a bit
maybe it was my way of getting the story across

well I contacted "legal aid" and was told a few things

if I registered the car in my name it would bring up a "red flag"
to the finance company and they could come and repo it
wether he was arrears or not

anyway I rang the seller and told him what I had found out
and he agreed to refund my money and call it quits
tonight he came to my place with the cash and took the car on a trailer

so alls well that ends well

thankyou for all your comments and suggestions
thanks again John

Awesome result mate, really glad it worked out for you. At least you know for next time, and the learning curve cost you nothing

[whitelion65]

Originally Posted by fordomatic

Awesome result mate, really glad it worked out for you. At least you know for next time, and the learning curve cost you nothing

And good on you for airing it on the forum. Educates more people, helping avoid repeats of this problem.

[Bossxr8]

Very lucky.

[TUF_302]

Good to hear mate, very lucky that's for sure!

[XB GS 351 Coupe]

Originally Posted by last fairlane

Hi all Im back at last
Thanks for all the comments though some missed my point a bit
maybe it was my way of getting the story across

well I contacted "legal aid" and was told a few things

if I registered the car in my name it would bring up a "red flag"
to the finance company and they could come and repo it
wether he was arrears or not

anyway I rang the seller and told him what I had found out
and he agreed to refund my money and call it quits
tonight he came to my place with the cash and took the car on a trailer

so alls well that ends well

thankyou for all your comments and suggestions
thanks again John

Lucky outcome for you, he was probably serious about getting his home loan and was worried himself that his credit rating would be damaged.

[Yellow_Festiva]

Use some of the cash for a lotto ticket perhaps your luck will continue!

[Morexbs]

Although it has ended up ok for you there is a lot of misinformation in this thread that I feel should be clarified.

Originally Posted by last fairlane

well I contacted "legal aid" and was told a few things

if I registered the car in my name it would bring up a "red flag"
to the finance company and they could come and repo it
wether he was arrears or not

This "advice" couldn't be more incorrect.
A finance company has no way of knowing if a car that they have an interest in gets sold,unless their customer tells them.
They also cannot legally obtain any of the new owner's details under the Privacy Act so,again,unless their customer tells them they have no idea who has the car.
No finance company would repossess an XH ute.It would cost them around $500 for a repo agent to knock on your door d in a metro area and a lot more d in the country.There would be further agent costs if they had to make multiple attendances.Then there would be towing costs to an auction house and then they would get charged around $400 to sell the car,so for them to even get back anything after costs the car needs to be worth at least $1500.The auction value of an XH ute is about $500,if that.

If you had bought the car and the seller had continued to pay his loan off,there would have been no problem.There would be thousands of instances each year where people sell their cars and keep paying the loan and the finance companies wouldn't have a clue.
If you had bought the car and he then stopped paying his loan,he would have got a collection phone call from his finance company which may have mentioned the possibility of repossession and if he didn't pay up he would have been defaulted and that's as far as it would have gone.
Many lenders (eg pay day) would take such an old car as security for a personal loan,but would never bother repossessing it.It's all about making things look better on paper.
Also worth noting is that if the car is security for a regulated consumer loan,it cannot be repossessed from private property without the property owner/occupier's permission or a court order.

Hope this clears up a lot of the earlier theorizing.

[MercurySilver]

So lesson learnt then yeah???

[last fairlane]

Thanks for that last comment XBs very interesting you seem to be very knowligable about finance matters
I know its too late now but if that was the case re the red flag
and not bothering to repo maybe just maybe I could have kept it
but after listening to legal aid I wasnt game to keep it and do it up
I was thinking an exhaust big wheels tinted windows and a paint job
would be nice but would hate to then have it repo'd through no fault of my own
so no more ute
thanks again