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Title not in hand...pay up or wait?

Hi guys, I have a very interesting tale to tell and get your advice on.



I’m a grad student in Rice University from India. I donot have a Texas drivers license, i do have an Indian drivers license.



A person I know, has a Honda accord 2001, with 110K miles, which I want to buy for 4000$. It is in good condition, no accidents, damage, runs good, manual tranny (I know that the automatics in 2001 Accord were suspect)



He took a loan from ACU Texas, and has to pay them around 4000$ back. He and I both bank with Chase in Houston.

The title is with ACU right now.

This is what I think I should do:

1. Give him the money for the car via chase bank cheque, and get a bill of payment for the car signed with a witness. This can be done in Chase bank itself. Then he withdraws the required money from his account and we drive to the

ACU texas. Acu texas is a little funny. Because they do so many auto loans, they will take 6 to 8 weeks to mail the title to you if you ask them to do so by mail. I called them up and they said that if you tell them before hand, and if you;re paying cash, they shall have the title ready for you and you can take it directly after paying cash.

Thus, in the best case scenario, I get a witness and a money trail from Chase bank, and get the title in hand immediately. In the worst case, I pay the guy, have the car in hand, and have to wait for the title to come to him and then we transfer it over.



Please let me know about your opinion on this matter.

"I called them up and they said that if you tell them before hand, and if you;re paying cash, they shall have the title ready for you and you can take it directly after paying cash."
Call them up, tell them you are buying the car and will payoff the loan, Have him sign the title over at the window right after you pay it off, I am not a lawyer but you have no reason to allow any leap of faith. Make sure you have an inspection done on the car by an independent mechanic prior to purchase. Money well spent!

I would not exchange money or take the car before the title is ready to transfer immediately.

I’m sure this guy is nice enough, but stuff happens-- it’s not at all uncommon for people to work out an arrangement like this, but then the title takes forever to come, and/or the seller forgets to send it and sooner or later you’ve got a car with no title and you don’t really know how to get ahold of them, etc.

The real worst case scenario is that something goes wrong with the loan payoff and since the bank owns the car, they can take it. Since you didn’t give the bank anything, they’ve got no obligation to you and getting your money back from the seller is much easier said than done. If the guy’s on the level and you know him, it’s not very likely, but it would be sufficiently bad if it did happen that I’d want to be sure.

Under no circumstances should you pay without receiving the title at that time. If that makes the deal go away, so be it, you do not want to be at risk here.

Go Owls!

If you want the car that bad, call ACU, ask if they will take a certified check, made out to them, as cash. If so, get Chase to certify your check. If not, get the cash and go to ACU with the guy, and give them the cash when they give you both the title, which he signs over to you right there.

I agree. Only way I would do this transaction is via some form of check that is made out to both the bank (lienholder) and the seller. I would want the title immediately signed over to me when the check was presented.

I spoke to ACU. They said that whoever gives the money, the title shall be made out in the sellers name. Then he has to take the lien release form and go to dmv and then get the title transfered to his name. After waiting for x number of weeks, he gets the title, and then he and I can go to the dmv again to get the final transfer of title. I can ensure that he pays the money to the ACU and go with him to do that, and then go to the title office to ensure that he gets the title into his name. I can also give him a cheque, leaving a paper trail.
Question, can the transfer of title from the lienholder to the Seller and then to me, be completed in one day at the Texas DMV office?
Cheers

Cheque can be made out to the bank with the amount of the lien remaining as the selling price of the car. Qn. How can the bank sign the title over to me, if my cheque only ensures that the seller is paying off his loan?
Can the lien be transferred to me?

Thanks for the reply .

You need to contact the DMV, they should be able to help.

Sounds like a goofy system to me. The rules I am used to would allow the bank to hand over the title and lien release to the seller. The seller signs the title over to you along with a copy of the lien release and you go to the DMV and title it in your name. Too bad you have to go through such a mess. I’d verify the process with the DMV as texases suggested…