How to Resolve a Private Seller Car Lien

When shopping for a used car, you stand to save money on your purchase when buying one from a private seller. Dealer markup can add hundreds to well over a thousand dollars to the price of a car, money you can save by negotiating directly with the vehicle’s owner. If the owner is still making payments to a lender, then there is lien on the car that must be lifted before you can buy it. A lien essentially locks down the car’s title until the loan has been paid off.


Learn the Vehicle’s History

No used car deal should be transacted apart from confirming the vehicle’s repair history. That information is available through, a company that compiles vehicle history reports specific to a car’s vehicle identification number (VIN). A vehicle history report should show its repair history excepting the work that the owner performed on his own. Importantly, if the car has been in accident or damaged by a flood, then the history report will reveal that information.

Confirm Vehicle Ownership

Simply because an individual claims to own a car does not make that person the rightful owner. You need to inspect the title and run the VIN through the National Insurance Crime Bureau VinCheck to verify ownership. VinCheck will confirm if a vehicle has been reported as stolen, but unrecovered. It will also list whether it is a salvage vehicle, one that has been damaged or seriously wrecked.

Inspect the Car With Care

Vehicle history reports can only reveal so much about a car. If you are handy, you can perform the inspection yourself, otherwise head to your mechanic and pay him to check the car. Have the car placed on a lift and examine the vehicle’s suspension system, inspect the vehicle’s frame, review previous repair work and look for leaks from the engine, transmission and the coolant system. A mechanic can also pull up the check engine codes to look for potential problems. No independent analysis will be foolproof, but your mechanic can offer his opinion on whether the car is worth your consideration and for the price you have in mind.

Negotiate Your Price

How much a private seller still owes his lender may have a bearing on your negotiation. However, if this individual owes more on the vehicle than what it is worth, you need not offer to pay that price. Instead, your price for the car should be based on its current market value, its condition, mileage and vehicle’s trim level (content). Visit Kelley Blue Book to obtain its private party value. You can show your mechanic’s report to back up your offer.

Head to the Bank

Never give money to a private seller and have him handle the paperwork. Because there is a lien on the car, you should meet the seller at the bank and complete the deal in front of a representative. Explain to the bank representative what transaction is taking place and have the seller ask for the loan’s payoff amount. Your funds plus whatever the seller still owes his lender will remove the lien, freeing the vehicle for a title transfer.

Demonstrate Persistance

Obtaining a car with a lien on it can take some time before the transaction is completed. With persistence you may be able to conclude the deal with a quality car obtained at a below market price.

See AlsoThe Perks of Buying a Used Car Instead of a New One

Matt Keegan
Author: Matthew Keegan
Matt Keegan is a journalist, media professional, and owner of this website. He has an extensive writing background and has covered the automotive sector continuously since 2004. When not driving and evaluating new vehicles, Matt enjoys spending his time outdoors.

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