Can a Mortgaged Vehicle Be Sold?
2 Answers
Mortgaged vehicles can be sold, but during the transaction, it must be clearly disclosed to the buyer that the vehicle has been registered as mortgaged. If the loan is not repaid on time, the vehicle may be seized and auctioned by the creditor to repay the debt. In such cases, an uninformed buyer can claim compensation from the seller for the purchase amount. As long as it is done through proper channels, buying and selling a mortgaged vehicle from a legitimate source is legal. However, if the mortgaged vehicle comes from an illegitimate source, it is considered illegal. Whether it is illegal depends on the type of mortgaged vehicle. A mortgaged vehicle is essentially a loaned vehicle, which falls into two categories: one is a bank-financed vehicle, and the other is a vehicle mortgaged to an individual or company for a loan. The legality of buying and selling a mortgaged vehicle primarily depends on whether the source of the vehicle is legitimate. If the source is legitimate, then the transaction is completely legal. However, if the purchased mortgaged vehicle is a smuggled or stolen vehicle, it is illegal. In addition, the biggest issue with buying and selling mortgaged vehicles is the transfer of ownership, which is also the main cause of disputes in such transactions.
Mortgaged cars can indeed be sold, but there are quite a few conditions. Speaking from personal experience, two years ago I bought an SUV with a loan, and when I wanted to change cars later, I got stuck here. The car was mortgaged to the bank, so the ownership wasn’t entirely mine, meaning I had to settle things with the lender before selling. Either pay off the outstanding loan or have the new buyer take over the loan. I went to the bank to complete a transfer procedure, which took half a month, and in the middle of it, I had to provide a bunch of documentation. If you sell it privately, the buyer might get scammed; if the car gets repossessed, the losses could be even greater. My advice is to check all debts in advance, consult professional intermediaries to help handle the process, ensure the transaction is secure, and avoid leaving any hidden risks.
