What is a Creditor's Car?
4 Answers
Creditor's cars are collectively referred to as mortgaged cars. Here is the relevant introduction about creditor's cars: 1. Classification: Mortgaged cars are divided into fully-paid mortgaged cars and non-fully-paid mortgaged cars. Non-fully-paid mortgaged cars refer to vehicles that are still under mortgage status with the vehicle management office and bank when sold. 2. Fully-paid mortgaged cars must meet one of the following conditions: (1) The car was purchased with a one-time payment. (2) The car was bought through installment payments, the car loan has been fully repaid, but the owner is unwilling or unable to repay the financial company and does not cooperate with the transfer of ownership, leading to a legal transfer of creditor's rights by the financial company.
Last time I was at the used car market, I encountered this issue. A lien car is a vehicle that the owner has mortgaged to a bank or financial institution after taking out a loan to buy it, and the car loan hasn't been fully repaid yet. These cars might seem cheap, but they come with huge legal risks. If you buy one and the original owner defaults on the payments, the financial institution has the right to repossess the car directly. Not only would you lose your money for nothing, but you also wouldn't get full ownership rights. For us ordinary people, buying a car is about peace of mind, so it's crucial to check the mortgage status on the vehicle registration certificate. It's best to make the purchase through a reputable dealer. A friend of mine bought a lien car to save money, only to have it repossessed after six months, and now he's still in court trying to recover his money. Remember, there's no such thing as a free lunch—safety should always come first when buying a car.
As someone who frequently deals with vehicle disputes, I've seen too many troubles with lien vehicles. Essentially, these are cars that the original owner used as collateral for a loan and then transferred before fully repaying the debt. The biggest risk for buyers is that the vehicle could be repossessed by the creditor at any time, and legally, the original owner remains the debtor. Such cars are cheap but come with endless troubles. Before purchasing, it's essential to check the vehicle registration information and confirm its lien status. The transfer process also requires a tripartite agreement involving the original owner, creditor, and buyer, which is quite complex. It's advisable to avoid lien vehicles altogether. If you must buy one, ensure a professional lawyer is involved throughout the process. After all, the financial loss and mental stress from having the vehicle repossessed are far greater than imagined.
Last time I helped a relative look at cars, we came across a lien car, which was priced 20-30% lower than the market. It's a car sold by the owner before the auto loan is fully paid off. Behind the low price lies a trap: the lending institution can repossess the car at any time if they find out, and the police won't intervene in such financial disputes. In the end, my relative chose a car with clean title history, spending a bit more but sleeping soundly. If you really want to consider such a car, you must confirm the original owner has paid off the loan and removed the lien, otherwise firmly avoid buying it.
