Buying RV private sale with lien

[Garry G.]

Hi all,
Wife and i have been looking for a motorhome for a few months. We live in northern New Hampshire so almost everything is a long distance transaction.  One of the bigger stumbling blocks is when the seller has a lien. We have found 2 motorhomes that we really like and would buy if not for the lien. The sellers both wanted us to give them the money (55k and 70k) so they could pay off the loan and then send me the title. Considering all the scenarios that could go wrong and that the person I'd be giving the money to is a perfect stranger I have decided not to buy the motorhomes.  In my state when you pay off a title you are sent the title. The states where these two RV's are I'm told the title goes to the state  DMV first  then to the owner then to me. Seems like allot could go wrong including something happening to the owner. Question is am I being overly cautious or unreasonable? It's allot of money to put out there like that it seems.

 

[Cant Wait]

You're right a lot could go wrong, first and foremost is that the owner could just take off with you $ and not pay the bank a penny.  The only way I'd even consider something like this is to bit the bullet and drive to where the RV is and make the transaction in person having a certified bank check made out to the bank that holds the lien in the amount of the loan pay off, and have a notarized will of sale.

 

[SeilerBird]

There are way too many RVs for sale to bother messing around with one that could burn you. Fly down to Florida for a vacation and pick one up while you are here. Then drive it home. We have billions of nice RVs for sale down here.

 

[Gary RV_Wizard]

State laws vary on lien payoffs, but there are always ways to handle the title transfer safely.  Generally, you make a check out to the lien holder and the owner jointly, so that you know the payment actually gets to the lienholder. Or you go there personally and do the transaction right at the lienholders offices. Then you need some arrangement about physically receiving the title. Maybe the state where the title resides could offer advice on how this is handled.  They must do that 100's of times daily, since even dealer trade-ins have a title transfer and often involve loan payoffs. There will be procedures for handling this that protect all parties, so you just have to learn what they are and get them set up.

This is part of what buying through a dealer does for you and why vehicle dealers often add a fee for title transfer. There is some effort involved, sometimes not trivial effort if you are a novice at it.

 

[scottydl]

As Gary said, there has to be a better option for those sellers.  They could probably call their lienholder, explain that the RV is for sale, and ask to have the title released under some certain conditions.  Or sent to a local financial institution, where you and the seller could exchange funds and you'd leave with the title in hand.  Or some other kind of arrangement where the money is held in escrow by a 3rd party, until you receive the title and approve the release of funds.  There are options.

It's a bad idea to hand over a bunch of cash and leave without proof of ownership.  Admission time... I did it with our first motorhome!  :-X  Not because the seller owed any money, but because they had recently relocated from CA to NY and re-registered the rig but the NY title had not arrived in the mail yet.  I was only paying $12k, a lot for us at the time but way less than you are considering.  So I left without a title, but did have a bill of sale signed by both buyer/seller with all details of the purchase.  There are lots of free templates online for this sort of thing. 

It all worked out eventually, and some weeks later the seller mailed me the NY title which I then re-registered again to IL... but I don't think I'd do it again, now that I'm older and (hopefully) wiser. 

 

[Sr Fox]

When we purchased ours we did it at the bank that held the lien for the seller.  I paid and the bank gave me a notarized letter stating that the lien was paid as was the full amount of the sale. The title was then mailed to me and I received it about two weeks later. The bank (Wells Fargo) was very familiar with this procedure.

 

[robertusa123]

Pay the Ballance to the bank first. With a wire transfer. Then the remaining if any to the owner.    If the owner is not willing to give you the bank info and instant you give him the money to pay the bank.  Run away and run away fast... Banks do this all the time so should not be a big deal

 

[PCarillon]

Garry when we bought our MH there was a lien on it.The owner signed a Power of Attorney to have the Title released to our bank where we got our loan. Our bank then sent the pay off with the Power of attorney to the bank that held the lien. Our bank got the title in about 3 weeks time. We are in Ohio the lien was held by a bank in california.  Though the seller was from our area so they were able to go to our bank. I would think you could coordinate the deal with the lien holders bank and and SEND THE BANK the money for the payoff and if you then have to send the owner the difference it can work out. No way I would send the owner the money to pay off the MH>>>> Money would need to goto lien holder