Are Bank-Mortgaged Vehicles Safe?
1 Answers
Bank-mortgaged vehicles are relatively safe. However, not all bank-mortgaged vehicles are secure. The key factor is the sales channel. If a vehicle has been mortgaged multiple times, it means there are multiple creditors, and more parties may be tracking the vehicle, reducing its safety. Therefore, when purchasing a mortgaged vehicle, it's crucial to consider from whom you are buying. Points to note during the mortgage period: During the mortgage period, the vehicle is subject to a property claim right, meaning that if the debtor fails to repay the debt when it is due, the creditor's mortgage right will be enforced, and the vehicle will be used as collateral to settle the debt. Therefore, buying a vehicle that is part of a mortgage carries significant risks. Legal basis for mortgaged vehicles: According to Article 394 of the Civil Code, effective January 1, 2021: To secure the performance of a debt, a debtor or a third party may mortgage property to the creditor without transferring its possession. If the debtor fails to perform the due debt or if the circumstances for realizing the mortgage right as agreed by the parties occur, the creditor shall have the priority right to be paid with the said property.