Purchased a vehicle with outstanding finance

[Kln1988]

Hi,
I'm hoping someone would be so kind as to help!

We purchased a car in good faith on 1st August this year. (We didn't know then, but do now how important a HPI check is)

Two weeks ago we received a letter from a Finance company saying they're was outstanding finance on this vehicle and they own it.

We looked at the citizens advice website and sent a letter explaining that we were unaware of this, we purchased it in good faith and sent all of the details of the person we bought it from and the screen shots of all of our correspondence with him.

They then called us yesterday and said it's in our best interest to call the seller and ask to return the car and receive a refund. (Which I've not read another case of that).

We did manage to speak to him and he said he never had finance on this vehicle and was also shocked to hear this and that he can't give us a refund as he has no savings or money. ( We paid almost 5k)

What can we do, where do we stand. Any advice at all would be much appreciated

[Pezza54]

It is possible that the seller did not carry out a HPI check and was also unaware that the car had outstanding finance. If he was aware then he has sold the car illegally.
The finance company should not attempt to recover the car if you prove you have good title to it. Did you get a receipt from the seller to prove you paid him money for the car?
There is an article on www.whatcar.com that provides advice about what a consumer should do if he or she purchases a car with outstanding finance from a private seller. The article recommends the buyer contacts the seller in writing so the finance company was not untoward when it asked you to contact the seller.
Keep copies of all correspondence. You need to show 100% that you were unaware there was an outstanding loan for the car and you bought it in good faith.

[Kln1988]

Pezza54 thank you very much for your reply here.

I didn't know anyone had responded.

We have since received confirmation that the private individual we purchased from is the customer of the finance company.

Thank you for the link to the article also.

We do believe we have good title and we communicated this by letter to the finance company already.

Yes we have also kept copies of everything

[Pezza54]

Forum readers will be very interested to know how you get on.

[R0b]

Just to be clear, the onus is on the lender to prove you did not buy the car in good faith as you are protected under section 27 of the Hire Purchase Act 1964. Lenders have a hard time proving their case and typically end up threatening to take repossession of the car or calling in to the police reporting it stolen in the hope that the buyer doesn't take further action. Only when legal action is initiated do the lenders tend to row back on what they've done.

The kind of response you received sounds like something MoneyBarn would say or some similar sub-prime lender. Are you able to share who the lender actually is?

I would also be asking the lender to remove the vehicle from any database related to HPI checks as this will cause you a problem if you later go on to sell the vehicle and the buyer runs a check finding its on HP when you have good title.

[Kln1988]

rob thank you for jumping into my thread, much appreciated!!

This is. First response finance

We have since discovered that the person we bought from Mr C was the person who took out the finance around 2 months before selling this vehicle to us.

We sent back our first response via letter as mentioned in my first post, however they have since been using telephone.

They are sticking to us giving the car back to our seller for a full refund or repossessing the car - which is causing us so much worry and anxiety as you can imagine.

We believe we have good title as we're a complete innocent purchaser and did not know of the outstanding finance at all.

They say we're not an innocent purchaser and don't have good title as we didn't do a HPI check and we don't have a recipet from the seller. And also added that how do they know we didn't know him, which we've stated we most certainly had never known him.

We have however provided them all of the screenshots of the correspondence we had with the seller (over 50 messages) that include price negotiations etc right up until the last message saying we're here and that's the same evening we bought the car.

I feel like at this point I need to send them a letter to have clarifications in writing, but don't know where to start with this.

[Kln1988]

R0b sorry I think I tagged the wrong account in my first reply

thank you for jumping into my thread, much appreciated!!
This is. First response finance

We have since discovered that the person we bought from Mr C was the person who took out the finance around 2 months before selling this vehicle to us.

We sent back our first response via letter as mentioned in my first post, however they have since been using telephone.

They are sticking to us giving the car back to our seller for a full refund or repossessing the car - which is causing us so much worry and anxiety as you can imagine.

We believe we have good title as we're a complete innocent purchaser and did not know of the outstanding finance at all.

They say we're not an innocent purchaser and don't have good title as we didn't do a HPI check and we don't have a recipet from the seller. And also added that how do they know we didn't know him, which we've stated we most certainly had never known him.

We have however provided them all of the screenshots of the correspondence we had with the seller (over 50 messages) that include price negotiations etc right up until the last message saying we're here and that's the same evening we bought the car.

I feel like at this point I need to send them a letter to have clarifications in writing, but don't know where to start with this.

[wales01man]

Why on receipt was the seller not able to seems they may be trying to avoid something

[Kln1988]

wales01man the seller is still denying to us that he's the one who took out the finance, even though the finance company have told us HE IS their customer/ account holder

This is by no means an excuse but the purchaser (us, who's almost 70) took this seller on his word, received keys, v5, service history and a folder of paper work, shook hands of the seller and the puchase was made.

He came across as a genuine guy both before the sale and during and gave no reason to doubt that he owned the vehicle.

We now know in future to do a HPI check, to have a recipt etc but that doesn't help us at the moment.

[Kln1988]

R0b additional update this afternoon, that I receive a voicemail from them saying their decision still stands, they will reposes the car and advise us to hand it over. Asking me to call them back to discuss.

Is this just bullying tactics do you think?

I want to stand out ground as I believe we have good title, however they definitely put doubts into your head.

[islandgirl]

I would not give it back but would take a full refund from the seller and get out of the problem asap As you say "They are sticking to us giving the car back to our seller for a full refund". Tell them if they intervene with the seller and you receive the money you will hand the car back. Otherwise not. (I know the seller says he does not have the money but the finance company can put pressure on them not you)

[R0b]

R0b additional update this afternoon, that I receive a voicemail from them saying their decision still stands, they will reposes the car and advise us to hand it over. Asking me to call them back to discuss.

Is this just bullying tactics do you think?

I want to stand out ground as I believe we have good title, however they definitely put doubts into your head.

Moving forward, you now need to keep all correspondence in writing for evidential reasons. Do not contact them by telephone unless it is absolutely necessary and if you have to, follow up with an email to confirm what was discussed on the call to protect yourself.

Anyway, you can do what IslandGirl has suggested but it's not your only option as you can stick to your guns and use the car. I've provided below a template response that was used in another thread a few years ago but is still relevant to your case it just may need modifying to suit. Parts in square brackets need completing.

Dear Sir or Madam,

On or about [date] I purchased a [year, name and make of vehicle] with the registration number [number]. The sale of the vehicle was a private one and the seller, whose name is [insert full name], claimed to be the owner of the vehicle. At no point was I made aware that the vehicle carried any outstanding finance. I therefore agreed to purchase the vehicle in good faith for the sum of £[amount].

On [date] I received a letter from First Response claiming to be the purported owner of the vehicle. I have already responded to you by stating that the vehicle was purchased in good faith and the seller claims to have no knowledge of finance being attached to the vehicle. I am aware of my legal rights and unless there is evidence to the contrary, title to the vehicle lawfully passed to myself in accordance with Section 27 of the Hire-Purchase Act 1964. In accordance with the Act, the onus is on First Response to prove that the purchase was not innocent.

[Today/Yesterday], I received a voicemail from someone at First Response claiming that you consider yourselves to be the legal owner of the vehicle and, despite providing no evidence to displace the legal position under section 27 of the HPA, you are now threatening to repossess the vehicle. I must say that I am concerned about your flagrant disregard to the law and my title to the vehicle as an innocent purchaser. You have no right to repossess the vehicle and if you have reason to believe otherwise, then I expect you to commence legal proceedings and a court can determine who has good title to the vehicle.

This letter should serve as notice that, if First Response attempts to, or successfully repossesses the vehicle either through your own efforts a third party acting on your behalf, your actions constitute a wrongful interference with goods, namely trespass to goods and/or conversion – an tort actionable in the civil courts. I will be seeking compensation for your deliberate interference, loss of use of the vehicle, additional costs and expenses with regards to travel and/or the hiring of a car until the return of the vehicle as well as any other losses suffered as a result of your unlawful action.

I trust this makes my position clear and I require you to confirm by return that you will refrain from taking steps to repossess the vehicle and proceed to close down this matter. I also expect First Response to remove any financial tags or markers on the vehicle in light of the above.

Please note that, all communications in respect of this matter should be sent by post or email using the information at the top of this letter. I do not agree to receive telephone calls or other methods of communication.

[Kln1988]

R0b

Thank you for the template I will send this recorded delivery today!

And the advice of how to move this to a traceable form of communication, much appreciated!

Where do we stand with not having a recipt from the seller? The finance company say this proves were not an innocent buyer and that's why we don't have good title.

Our seller is still insisting that the finance isn't his, even though the finance company told me MR C (our seller) is their customer. I feel as he's being so deceitful towards us this isn't going to help us.

[R0b]

How will a receipt prove you are an innocent purchaser? If this was a private sale on a second hand car, it is not common for private buyers and sellers to hand over receipts to confirm a sale.

First Response are chatting nonsense but you do need to be prepared for the fact that they may attempt to to recover the vehicle by reporting it stolen or having a third party to try to repossess it (sometimes in the middle of the night).

If you hand the keys over to them, you lose all rights and your recourse is going to be against the seller only. Equally, if things do go south, you are going to have to consider moving fast to start legal proceedings before they decide to sell the car. You can seek an emergency injunction but that will cost you more money or just simply go down the normal route of bringing a claim to deliver up the car or claim compensation in lieu.

[Kln1988]

R0b

Thank you for this additional information

Definitely a private sale, on a second hand car, with no knowledge of the finance until they contacted us.

The letter is written up and will be sent recorded delivery today.

Thanks for that clarification we most certainly won't hand over the keys and we are purposely parking it behind a locked gate at the moment.

Your help here is very much appreciated and I will keep you updated.