This is a really dumb question for

[Pheidippides]

somebody who spends most of his life doing commercial lending transactions. Or maybe it is precisely because I am a lending lawyer I have this question.

How does it work when you sell a car that is financed, in terms of title and such?

I'm selling my car. It is financed, although not underwater at all.

If I were to be a buyer in that situation, I would want to make sure that the proceeds of the sale go to pay off the loan and that the lienholder is removed from the title. But I'm not sure how you evidence this in a private transaction like this.

What do normal, non-banking lawyers do? And what's the usual process for handling title? I've only ever purchased cars without liens on them, so title is easy: fill in the blanks and then send it in.

TIA for helping me out with such a silly question.

[cowboy]

somebody who spends most of his life doing commercial lending transactions. Or maybe it is precisely because I am a lending lawyer I have this question.

How does it work when you sell a car that is financed, in terms of title and such?

I'm selling my car. It is financed, although not underwater at all.

If I were to be a buyer in that situation, I would want to make sure that the proceeds of the sale go to pay off the loan and that the lienholder is removed from the title. But I'm not sure how you evidence this in a private transaction like this.

What do normal, non-banking lawyers do? And what's the usual process for handling title? I've only ever purchased cars without liens on them, so title is easy: fill in the blanks and then send it in.

TIA for helping me out with such a silly question.

Get a payoff from the lienholder, provide a copy to the buyer, and ask that the buyer bring a cashiers check made to the lienholder for the payoff amount and another check for the balance.

[wuapinmon]

I love CUF. Thanks, cowboy. I've wondered how to do this too.

[mUUser]

Get a payoff from the lienholder, provide a copy to the buyer, and ask that the buyer bring a cashiers check made to the lienholder for the payoff amount and another check for the balance.

I presume you'd meet at the lienholders office (bank, credit union etc...) to exchange monies?

[Pheidippides]

Get a payoff from the lienholder, provide a copy to the buyer, and ask that the buyer bring a cashiers check made to the lienholder for the payoff amount and another check for the balance.

I think that gets the buyer part way there, to be sure (although it wouldn't be enough in a full-scale financing/purchase, which this obviously isn't) and is probably as good as you can do in the real world.

We'll see what the buyer asks for when we get there. To be clear, this isn't my risk at all. It's the buyer's risk, and untrained people don't think in these terms very often.

[mtnbiker]

I had that very situation last year when I bought a car from a guy at work. I met him at his credit union, wrote him a check, which he cashed on the spot and paid off the lien. We also signed a generic purchase agreement that I got online, that included price, VIN, lien info, etc. I think we had the cu notarize it and make us copies. The credit union held the title until the funds cleared, then mailed me the title 3 days later. If we didn't know each other, it probably would have been better to do cashiers' checks, but it worked out fine.

[Surfah]

I sold my F-250 a few years ago. I sold it for a few grand more than I owed. My loan was with USAA. The buyer's credit union cut USAA a check (wire transfer) for my asking price. USAA paid off my loan and transferred the balance to my checking account and sent the title to the buyer. Easy as pie.