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How to buy with a lien on title

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Old 07-17-2009, 01:29 PM
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Default How to buy with a lien on title

My buddy is buying a boat sunday and the seller has no title since Key bank holds it. How does he purchase it with no title etc. The owner wants him to make the check payable to Key and the owner will make up the difference to pay it off. Thanks alot
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Old 07-17-2009, 01:35 PM
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Buy the boat Monday when the bank is open, and get documents from the bank.

Even if your buddy pays the bank directly, and the current owner does not pay the bank, he won't get a title release.
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Old 07-17-2009, 01:38 PM
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Shouldnt be too much of an issue, just make sure he has a notarized bill of sale. I bought a car like that once and went to the bank with the former owner to pick up the title and give him the check, it was held by a local bank though.
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Old 07-17-2009, 01:41 PM
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Originally Posted by WARPARTY36 View Post
Buy the boat Monday when the bank is open, and get documents from the bank.

Even if your buddy pays the bank directly, and the current owner does not pay the bank, he won't get a title release.
Bingo...you wont get the title until the entire lein has been satisfied...if they seller is upside down(which he is). he will need to come up with the remainder or the bank will keep the lein.
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Old 07-17-2009, 02:52 PM
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I ran into a similar situation when I purchased my boat last year. If it were me, I would have the seller give his bank permission to talk to you regarding the note. (The bank will probably require written notice from the seller that this is okay) This way you can get the exact payoff information from the bank, and make sure that the seller comes up with his part of the deal.

Or it would be even easier for all parties to go the bank on Monday and complete the transaction that way.
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Old 07-17-2009, 03:05 PM
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Do not do it that way......I got a good kid in trouble that way last year.

Your buddy pays, and then the owner sends what he thinks the payoff is and the bank adds fees and all sorts of penalties and all the sudden its not paid off and your buddy doesnt get the title.

Regions did it to me.

I dont know the "right" way to do it. That deal was the fist thing that I sold that I owed money on. Id be interested to see what others have done in the past.
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Old 07-17-2009, 03:25 PM
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you call them bank, get the pay off, make a cashiers check out to the bank, and pay the owner the difference.
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Old 07-17-2009, 03:40 PM
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you call them bank, get the pay off, make a cashiers check out to the bank, and pay the owner the difference.
Re-read the post. The owner owes more to the bank than the boat is worth.

apppedigree, I applaud you for bringing that up to help others, it takes a big man to admit mistakes. I'm glad you two got that resolved.
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Old 07-17-2009, 04:08 PM
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Re-read the post. The owner owes more to the bank than the boat is worth.

apppedigree, I applaud you for bringing that up to help others, it takes a big man to admit mistakes. I'm glad you two got that resolved.
I learn things the hard way. That boy definetly didnt do anything wrong. When it boils down to it I did not do my part.

But it does raise the question. What is the right thing to do.

Another question - you get a bank check, buyer takes the boat. My bank held his for 18 days before releasing funds (Wachovia said it was standard). They said that a bank check can still be stopped. I thought that they were as good as cash.

I am interested in know how to do it where you dont have to take someones word for it.
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Old 07-17-2009, 04:12 PM
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Call the bank with the owner and have them give you a written payoff good for 10 days.

Have the buyer get a cashiers check made out to the bank that holds the lien and have the seller get a cashiers check for the difference made out to the bank.

Overnight the payoff with both cashiers checks to the bank if there is not a local branch of Key Bank there, you obviously can't do this on a sunday. You should also have a signed statement included by the seller that the lien release documents and title if any should be sent to the buyer of the boat and give them the address.

Depending on how the title to the boat is held, documented, UCC or title you should also have the seller sign all documents needed to trasfer the boat to you at the time send the payoff so you don't need to track him or her down later and sign.

If all this sounds greek to you, I encourage you to employe the services of a marine title company. I assume you already did a search on the title to the boat, motor and trailer if any to make sure of any and all liens out there.

If not, again, marine title company. Cost you $300 and may save your ass.

Last edited by Von Bongo; 07-17-2009 at 04:17 PM.
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