Suggestions about buying a motorcycle that has a loan (USA).

[yak]

When shopping for a larger motorcycle, i am finding lots of sellers who have loans to pay off. I can pay off their loan and take their bike home ( i get a Bill Of Sale when i send off the loan money). But i can't register the motorcycle until the loan release arrives. It is not a huge problem if the lender is local; i can deliver the payoff money in person...... some lenders do an electronic release so i can get a title the same day. Other lenders are out-of-state and might take 3 days or 3 weeks to get me the lien release. Those are 3 weeks where my money is gone but i can't ride the bike. And the lender won't return my phone calls because my name is not on the lien. They act like they don't know who i am; even tho they received a cashiers check from me.

Can you share your stories about buying bikes with loans.

Some sellers financed the entire purchase price plus the tax, title, doc fees, destination fees. After paying for 1 year, they still owe more than the original price of the bike.

[kramnala58]

Sorry, I don't have advice on buying a bike with a loan against it, but when I read the end of you post, I couldn't figure out who is dumber, the person who bought the bike or the lender.

Why in the world would a financial institution lend more money than the bike was worth. All that is needed is one accident, and the purchaser can walk away from it say, "Oh well, not my loss." And who in their right mind is going to go further in debt than the bike is worth other than someone who is not too concerned whether they pay the loan off or not. Probably not surprising that the bike is for sale. The purchaser probably couldn't afford it in the first place. Or maybe they are looking for a "bigger and better" bike that can help take them further in debt. No wonder the world is in the fiscal shape that it is.

Okay ... rant finished, back to normal life now.

[gn2]

Some sellers financed the entire purchase price plus the tax, title, doc fees, destination fees. After paying for 1 year, they still owe more than the original price of the bike.

But the real price of the bike is what you call the out the door price.

Here in the UK the only price listed is this out the door price and it is normal for finance to be based on this price.

One way of getting a cheap finance deal on a vehicle is to buy it on your credit card then transfer the balance onto a new 0% interest credit card.
Works like this, bike costs £5000 out the door, pay with normal credit card.
Transfer balance across to new 0% card with 3% transfer fee.
Pay new 0% card off prior to 0% period ending, typically 30 months and the finance has cost you £150

As for your problem of negative equity, that's always going to happen given the huge initial depreciation of new vehicles.
Vehicles are liabilities, not assets....

Looking at financing a bike another way, if you finance a bike over three years and throw the bike in a skip afterwards, it will still have cost you less than renting.

[iceman]

How can the purchaser walk away from a finance deal - if they do a runner they are then on a wanted list of sorts - you should not be able to get away without repaying in full with interest.

[Mel46]

When we sold our leased car to our daughter at the end of the lease, she wanted to drive the car right away but I couldn't give her the keys because the title was still in limbo. If she had taken the car and had crashed it, it could have still been in my name, which would have really tied up the title transfer, since the check was from her and not me or my insurance company. There is no way of knowing at what stage the transfer is in. There is nothing you can do until you or your lender have the title in hand.

[pcx man]

Here in Ohio you can take a bill of sale to the DMV and get a temp tag while you wait on the title. You can also ad it to your own insurance right away.

[yak]

@"pcx man". You are correct. i just called the DMV and they will let me have a 30 day permit with a Bill Of Sale. They asked that i use their form as the Bill Of Sale.

[WhiteNoise]

Hmm...what are you up to yak?
I'm feeling like a new(ish) bike will be coming down the pike
For you, Yes?
Do tell....
Are you Not delivering the CTX700's?
Or are you buying 3?
OH, WHAT FUN THIS WILL BE!!

[dkazzed]

I would expect the seller to fully pay off the loan before I buy it.

[Mel46]

The problems occur when there is a loan on a vehicle you are buying from an individual. Be careful of the Bill of Sale. They do not mean a lot until money exchanges hands AND the debt is satisfied. Imagine how easy it would be to screw up things if you gave the guy money but he didn't pay off the debt. It has happened here before, and what a mess. It falls under fraud but some stupid people will fall for this while the seller takes off out of state. Not to say the particular seller you know will do this but it has happened, so be aware.

[dkazzed]

Yep. I'd hate to hear someone had a vehicle repossessed because the loan tied to the vehicle was not paid off and went into default.

[Mel46]

Believe me, one of my cars went through this, so I know. In my case I purchased an end-of-lease return that was being sold at auction. The bank was suppose to clear the title, but the didn't. My bank set up financing and we took possession of the vehicle. All was fine for 6 months, until we got a notice from our bank that the title had still not arrived. We went to the dealer who had purchased the car for us. He went to the other organization's bank (lease cars usually get financing while you are at the dealer, but they still get financed through a bank or other financial institution.) That bank started calling around and found out that the title had not cleared before they sent it to auction. Boy, was somebody pissed! I bet someone lost their job on that one. Then we had to get the DMV involved because the title was still in the other person's name, since they had not gotten a cleared title yet either. It took 3 months to get it cleared up, AND everyone found out at the same time that there was a Mechanic's Lien on the title that some how slipped through the cracks and was caught once the title cleared the bank and went to the DMV. Then the bank (original bank) had to chase down the garage that had put the lien on it. Unfortunately, it had gone out of business (bankrupt), so there wasn't anyone to clear it except the court that was handling the bankruptcy. What a mess. Lucky it was a Volvo or I would have handed the car back to the dealer. So, a Bill of Sale means very little until the debt is cleared.

[gn2]

In the UK for a small fee you can check if there is outstanding finance on a used vehicle.
This check will also reveal if it has had collision damage.
You can find out its MoT test history for free.
(MoT is a mandatory annual roadworthiness safety check)

[kramnala58]

If there is an outstanding loan, you may also be able to write a check (cheque) directly to the company holding the loan.

[Bash On!]

[long, sad story] So, a Bill of Sale means very little until the debt is cleared.

That's why I buy new (one exception for the R75/5--can't buy a new one of those and the seller had a clean title).

[Mel46]

(MoT is a mandatory annual roadworthiness safety check)

Boy, I wish they had those in the South (Southern states of the United States). There are many cars on the road down here that absolutely should NOT be on the road! As an example, the other day I saw one driving around with something so wrong with the front end that the wheels wabbled and did not track true what so ever. I would say that the axle was be t or broken, but I don't know if it had a front axle or was a front wheel drive. In any case, it looked like the car had been rolled, yet someone was driving that thing...I have no idea he was steering it though. The roof had been kicked back out, the windshield was taped on with duct tape, no back window, the driver's door was taped closed at the pillar, and the trunk was held down with a bunjie cord. The only inspection down here is smog emissions, and after a certain age it doesn't even need that.

[iceman]

The police can stop and fine you for broken tail-lights (if we believe the films) but not if a vehicle is a complete wreck!

[Mel46]

Unfortunately, the safety inspections are up to each individual State in the United States. Those in the Southern part of the Unite States have long been lenient on vehicle inspections and have come up with every kind of excuse you can think of in order to NOT implement any kind of inspection what-so-ever. The Federal Government had to step in to for pollution inspections. Until then it was not unusual to see vehicles driving down the road with a blue fog coming from the tailpipe so thick that it blocked the view of those following it. Because the Federal Government has a 'hands off' policy for how states handle licensing and vehicle inspections, there will probably never be vehicle safety inspections in the South. The poorest states are the ones that need the inspections the most. These include, but are not limited to Louisiana, Mississippi, Alabama, Georgia, North Carolina, South Carolina, Tennessee, and West Virginia. The worst offenders seem to be the first 4 mentioned.
So, you are correct about being stopped for a broken tail light in many states, especially California...just not ALL States.