Finance fraud by professional fraudsters may be on the decline but car buyers continue to be at risk of buying a car that has outstanding finance on it. This could be under a hire purchase or lease agreement.
“When finances are squeezed, we have seen that people use the money raised from the sale of a car to address more pressing, short term, financial pressures and don’t pay off the car’s outstanding finance agreement itself,” explains Shane Teskey, Senior Consumer Services Manager for www.hpicheck.com. “Roughly a third of motor fraud cases are believed to involve customers selling their car without settling their finance agreement in full”
HPI believes there are thousands of UK motorists driving cars that they think they own. Many of these people are unlikely to ever discover the truth as the finance agreement is eventually paid off by the seller
“It’s never too late to check the finance status of your car. We advise owners as well as potential buyers to always visit www.hpicheck.com where they can discover the truth regarding any car’s finance status. If buying a car a good idea is to pay off the finance yourself, and then raise a bankers draft in the name of the seller for the remainder” says Shane
“Whatever the circumstances when you buy a car it is vital that you ask the right questions”
Top Tips to Avoid the Innocent Fraudster
1) Always conduct a vehicle history check BEFORE you buy – it will tell you if the car has outstanding finance against it and enables you to ensure that the finance agreement is concluded before you complete the purchase
2) If a car you are about to buy is on outstanding finance, raise two bank drafts, one in the name of the finance company for the outstanding amount of the loan and one for the seller for the remainder
3) The provision of a seller receipt or purchaser receipt will not stop a finance company trying to reclaim the vehicle from the buyer if the car later turns out to be on outstanding finance – so never accept one as proof the vehicle is clear of finance.
4) If you unwittingly buy a car on outstanding finance and discover this to be the case afterwards, don’t delay – negotiate with the finance house that holds the car’s title.
13th March, 2014