An Issue after Selling My Classic Car

[Nasser Almasary]

Hello everyone,
  A gentleman bought my car paying one third of the price and financed the rest, I am paid off in total, and he asked me to write the title in the loan company's name and mail it to them in CA, which I did. Two weeks after the purchase, he said that he did not ask me to write the title in the loan company name claiming that I made a mistake and I showed him some correspondence between us that indicate that I was right. Now, he is insisting on me to change the title to his name going to VA DMV to obtain a new title under my name and then sign it to his name, which I have no problem doing that, even though I don't know what expenses I would encounter doing so.
The questions are:
1- Would the loan company run after me for their portion of the payment ? which they wired to my bank account without any talks between us. The buyer wired his part of the money directly to my bank account too.
2- what are the risks on me obtaining a new title from VA DMV and sign it to the buyer ?
In discussing the matter with the buyer, I told him why the loan company don't accept the title and get a new one and then sign it to you ? he said that he'll be paying the sales tax twice. So, I asked him to write me a notarized document releasing my liability towards the loan company and he would assume such liability, and he accepted. Then, how do I know such document is true and his signature is not fake?
I want to help the buyer in everyway possible, but it could be a very cleaver scam situation. All your ideas are greatly appreciated. Thank you very much and happy holidays.
Nasser,

[Dan LeBlanc]

Sounds like a scam to me.  It's an issue between him and the loan company in my opinion.

If he paid off the loan, they would release their interest.  It's like buying any other car - sales tax is paid at time of purchase, not when the loan is paid in full.

Steer far clear of this one and send him back to the title company, or your lawyer.

[rwchatham CLC 21892]

As Dan stated, do not do it. It is between him and the bank.

[Eric DeVirgilis CLC# 8621]

Firstly, the vehicle is not supposed be titled in the name of the financial institution, rather it is titled in the name of the buyer with the institution listed as lien holder.

Secondly, how is it possible for him to have paid sales tax if it had not yet been titled?

OR

Is he saying the financial institution already obtained title in their own name for which the buyer forked the bill for the tax. If that's the case, he WILL have to pay tax again when the lien is paid off because as far as the state is concerned, the buyer is essentially "buying" the car from the financial institution.

As ponder this, I'm beginning to think the error occurred when the financial institution was listed as "purchaser" on the title when it should have been listed as lien holder.

IF it is the case that the vehicle got titled in the name of the finance company, do not apply a duplicate title - it is fraud.

The only thing that can be done at this point if for the buyer to throw himself upon the reasonableness of the state, explaining how the error occurred and hope for the best without having to pay sales tax again - assuming this is indeed is what occurred.

[Jeff Wilk]

Fully agree here and STAY CLEAR of being in the middle of this. He can and needs toneork it out directly with his Loan Company and his State DMV directly.

[76eldo]

I only know about PA sales tax. That's paid when you register the car regardless of it being a cash transaction or having a loan.

I'm surprised that the loan company didn't give you specific instructions on exactly what to do with the title.

The title is their security interest in the car.
This guy is a scammer.  He is either looking to beat the finance company out of the money or wants to get another loan on the same car and beat both of them.

You sold your car and surrendered the title to the loan company in exchange for the money they wired you for the balance on the car.

If you go and request a duplicate title you may be committing a crime and/or being an accessory to a crime yet to be committed by the buyer.

I'd tell him flat out NO.

If you want to be nicer just tell him you inquired about getting a duplicate title and explained the situation and you were told you cannot get a title because you sold the vehicle.

This smells as bad as week old fish.

Brian

[Eric DeVirgilis CLC# 8621]

I would not be so quick to condemn the seller without first knowing all the facts of the situation.

[TJ Hopland]

I too think something sounds odd here.  It may not be the buyer, it could be the loan people.     Does searching their name come up with anything good or bad?    Presumably the buyer has the car but is maybe having issues getting it licensed?    Did the car change states?

If its the loan company I can see how it would be nice to help the buyer but like others are saying getting another title does not seem like its going to be a good thing for 2 of the 3 parties. 

[Nasser Almasary]

Dan, Mr. Waligora, Eric, Jeff, and Brian,
Thank you very much for your insights, that was quick guys. The buyer will return the original title that I have signed to the loan company, thus, I assume that he nor the loan company got a new title because any state DMV would keep the old title to them. Is there any state DMV would give back the old title plus the new one to an owner of a car ? If yes, I could say that this is a true case of a scam.
Could the DMV accept the loan company's explanation of this issue and title the car to this buyer ? I doubt it.
Eric, you brought an important heads up, that the company should be a lean holder on the title. This is a point that I can argue with the buyer. I am really afraid here, mean while I really want to clear the matter with this fellow who seams to be a real collector guy.

[Eric DeVirgilis CLC# 8621]

PM sent.

[Jeff Rosansky CLC #28373]

The loan company would not hqve released their $$ to you if the titlework was not correct at the time. Once you have the $$, you are done.
Jeff

[Scot Minesinger]

First, I think Eric is right don't be too quick to condemn the buyer.  I live in VA and as others reported the title should be in the name of the owner and a lien would be listed on the title. 

You should make it so no one can take money out of your account.  Sometimes financial institutions do wire money back and fourth.  I would draw that account down to $10 for a while.  This is your ultimate insurance policy.

Then you hold all the cards and can work with buyer properly and cautiously.  It sounds like this is a novice car buyer.  Everyone knows that if you buy a car with a loan the title is in the owner's name not the finance company.  I won't even comment about the idea of borrowing money to buy a hobby car. 

You can kind of find out if this could be a scam in another way.  Ask how the buyer is enjoying the car, listen for details.  A person into that car will talk your ear off.  You will be able to tell if he is into the car or not.  If not a scam is likely.  Someone tried to buy a car from me over the internet and the questions they asked were so stupid, no request for a price reduction, and then came the method of payment - all 100% paypal - hello. 

You have the money, they have the car, so this is headed in the right direction.

Good luck,

Scot

[76eldo]

I said at the outset that I am not familiar with VA registration.  I know PA registration practices and I also export cars to Europe several times a year.  An absolute rule is NO money is exchanged without getting the title at the time of the sale.  We have paid off banks for sellers and had to trust them to provide the title and the car when the title is issued.

There are too many things that are not clear here.

1.  Did the buyer get a car loan, or is it a personal loan or line of credit?
2.  How did the finance company pay you without even seeing a copy of the title first?
3.  In most states, the lien holder retains the title and furnishes it when the debt is satisfied.

Now you mention that you are getting back the original title.  If you go to the DMV with the signed title and explain that it was assigned in error, you can get a new title.  In PA you can get it on the spot in Harrisburg which I have done.  You can also get a tag agency to do it for you.  Not sure what the deal is in VA.

If I were you, I would ask to get something in writing from the finance company explaining how the title should be signed and where it should be sent.  I can't believe they would tell you to send it to the buyer, but get your details in writing so that you have a record of what is being done.

The car is gone and you have the money so all of this extra work is going above and beyond which we would all do to help out a fellow hobbyist but just cover yourself in the event this guy is trying to pull of a shady deal.

Brian

[Glen]

I’ll add a couple of things here.
1.   Check out the loan company with the Better Business Bureau or ask your bank what they know.  There have been scams on eBay where the seller asks you to send your payment to an escrow company, when the seller defaults you find out the escrow company was a fake and the seller has your money.  This maybe a variation on that.   
2.   If the loan company checks out talk to them and get their take on what is going on.  This buyer maybe trying to run a scam on the loan company. 
I don’t know how a scam with this MO would work but then that’s the whole thing with scams, you don’t see it coming. 

[Bobby B]

As long as you are 100% sure that you have your money and all transactions are clear, the ball's in your court. You can handle it any way you want from this point on with no recourse. I wouldn't go out of my way if you feel uncomfortable with the whole situation. There's no rush, so do your homework as posted here. I honestly don't see how it could be a scam that would directly affect you, if the funds are in your account as you say they are. I would call my bank first thing in the morning to verify that the funds were legit and secured. Good Luck and Keep us posted….
                                                                                                                                  Bobby

[Nasser Almasary]

Glen, Scott, Brian, Jeff, Eric,
   Thank you very much for the valuable advices which I appreciate very much, it is just like having a battery of lowers on your side. The money is well into my account and it is legitimate (account is almost zero now). The loan company sent a guy to see the car who took some pictures and I sent the company a picture of the title prior to the transfer of money and prior to the handing of the car to the buyer. The loan company contacted me after the deal assuring me that the title should've been written to the buyer, I don't have a formal letter in that and it was just phone calls. As Scott mentioned, the VA DMV don't have a problem issuing another title to correct the mistake as the buyer (I assume) did not transfer the ownership nor did the loan company (Westside).
  The buyer has another collector car and has a Utube video driving it. before the sale, he drove up to VA and spent about two hours inspecting the car crawling under it and inspecting every detail of it we had a test drive as well. He also talked to me about how excited he is acquiring my car and talked about fixes he done immediately after he got it to his house in NC.
  When I confronted him with evidence on his instruction to me to sign the title to the loan company, he was oblivious about it and said " that doesn't make any difference" which made me very suspicious. I really want to help him, but I don't want to put my self in any risk. This story has some lesson and wisdom for other fellow collectors to have an open eye and think about all details of consummating a deal.
Thank you again, happy holidays.

[russ austin]

Get the old title back, and go to the DMV and request a new title. Don't tell them the story, just that you need a replacement title.   Nothing illegal going on, your just fixing a paperwork error. 

[Eric DeVirgilis CLC# 8621]

If there's evidence of a scam here, I'm not sure I see it.

Nasser... do nothing without first discussing the matter with the finance company.

It's a very good thing the title was not sent out and the original title still exists. When and only when you have the original title back in your hand, apply for a duplicate. Do not do it before. Simply indicate "Lost/Destroyed" as the reason and ask the finance company what they would like done when the new title comes in the mail. 

I would recommend signing off as seller on the title ONLY. (If your state requires the title be notarized, do not sign unless in the presence of the notary). It is the responsibility of the buyer & finance company to enter the rest of the information on the title for proper registration, titling and lien recording in the buyer's state. 

[76eldo]

I agree.
If the loan company said its ok to sign the title over to the buyer and you are getting the original
title back I'd feel comfortable with doing that.

If they required possession of the title they would have told you that.

Initially it sounded more like the buyer wanted to have you obtain a second title and get a copy as if the sale had never taken place. Seemed like he was trying to double finance the car or sell it for cash while owing on the loan.

Good luck

Brian

[55 cadi]

Just a thought,

When you buy a car and have payments you don't get the title and it is not in your name, it still belongs to the finance company until it is payed off, that is there safety in case you don't pay them they can recoup there money by getting car back and selling it.

So if the buyer got an "auto loan" the finance company will want it in there name in case he stops paying, then they can repo it back and sell it.

I wouldn't put it in his name!

He is trying to go around the finance company and he may not intend to pay them.

He said the loan companies name first so he would get the loan, then after all that takes place and gets car he wants you to switch it to his name,  this is not legal, he is asking you to commit a crime by changing and re-issuing a new title in his name, when as of now it is not your property anymore.

I am from California and have not seen it done in that manner.

Sounds like he is trying to get the title, once he has the title the loan company can't do much,they can take to court but then he could claim bankruptcy and the loan company gets nothing, he can say that's his only car and be able to keep it.

I would not go back and change anything, leave as you did, if they sent you the money and he has the car and you then go to dmv and change title or anything else......you are in the wrong and liable.