Buying a pre-financed used car can be a pain, that’s why it is essential to have a VIN look up before you go for the final purchase. This article will help you know about the details of the term “lien” on a used vehicle.
What is Lien?
If you have selected a used car to purchase and the vehicle history report shows lien in the details, don’t get shocked. The lien is the amount of money that should be paid to the bank to release the car for sale. It is the total amount of money, which a person owes on anything they have financed. The term Lien can be stated as an amount that the bank still needs to release the car for sale.
Here is a condition which will help you better understand the details of “lien”, let’s say you have chosen a vehicle which the seller still owes $13,000 and yet the asking price is$14,500. To come out of the hurdle, you need to take out a loan to pay off the lien. Make sure to choose a loan that is sufficient to cover the lien. You can apply for the loan either in a bank branch or online. Generally, the standard APR (rate of interest you will incur while having the loan) will be 5% or less. If it exceeds, please check with other banks for a better deal. Bad credit can lead you to pay a higher APR. Once the loan is approved your bank will then work with you to pay off the bank that holds the lien of the car that you wanted to buy.
How to check for liens
You can check the lien in these ways:
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- Ask the seller for a copy of the lien release document.
- View the vehicle title for lien details
- Get a vehicle history report on Vehicle Check USA.
Proof of Insurance
You must have the proof of insurance before the final completion of the entire purchase process gets over. You can get the detailed idea of car insurance at Vehicle Check USA. You can also look at USAA insurance plans for your car purchase.
Is selling a car with a lien illegal?
No, As long as the sale allows you to pay off the loan and transfer the title to the new owner, it is not illegal to sell the vehicle with a lien on it. .
However, many states make it illegal to sell a vehicle without a title. In case you have lost the title, getting a replacement is not that difficult.
Remember, a car will be considered stolen if you don’t have a title because you didn’t pay off your loan. Avoid getting in such legal troubles!!
Buying a used car? Don’t forget to check the Vehicle History Report
If you are looking for a used car purchase and you don’t want to get cheated with a lien or any other title like salvage, rebuilt etc., just get a vehicle history report. A vehicle history report will confirm the details of the car and it will reassure you that you chose the right car…
Every used car has a back-end story and some of them are nothing short of a nightmare. So, always look for the Vehicle History Report before purchasing a used car. It will help you know if a car has a clean history or hidden problems. We have data available for every used car sold post-1982.
