Finance warning for car buyers | Bay of Plenty Times

Finance warning for car buyers | Bay of Plenty Times:

Finance warning for car buyers

Have your say »  Sonya Bateson  19th Jul 2013 10:00 AM

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 Alex Lopez lost his car because its previous owners owed money to a finance firm.

Alex Lopez lost his car because its previous owners owed money to a finance firm.

An increasing number of Tauranga people are inadvertently buying vehicles still under finance - putting them in danger of repossession.

The news comes as two people, who had their cars repossessed after the previous owner left the country with money still owing on the vehicles, warn others to ensure everything is in order before buying a vehicle.

Tauranga Turners Auctions branch manager Carl Jarmin said about twice a week people trying to sell cars through the auction discovered there was unpaid finance on the vehicles from a previous owner.

Repossession of financed vehicles had increased since the global financial crisis.

"We've had people who have bought cars through Trade Me, or privately, and there's been money owing. It happens a lot more than people think. We see it probably twice a week where people are coming in, they've got a car and they've found out there's money owing on it to someone else."

"A lot of it goes on. If people need money, they sell their car to someone and still have $5000 owing, they sell it for $3000 and take the money and run."

Mr Jarmin said every car Turners sold was checked and was encumbrance-free.

Last year Citizens Advice Bureau dealt with more than 4000 inquiries relating to vehicles including buying and selling cars and disputes nationwide. About 600 related to finance and repossession of cars.

The Bay of Plenty Times spoke to two people battling to save their cars after the previous owner left the country with the vehicles still under finance.

On Monday, Levin company Oxford Finance tried to repossess a 2005 Nissan Lafesta belonging to father of three Alex Lopez, which he purchased from a former Tauranga couple last month for $4500 via a Facebook buy-and-sell page.

After trying to find out more information, Mr Lopez discovered another woman was also in danger of losing her 1996 Nissan Pulsar, given to her by the same couple in lieu of rent payments.

The repossession notice said there was a total balance of $13,969.75 owing on both vehicles.

The woman, who the Bay of Plenty Times has chosen not to name for legal reasons, said the couple had stayed with her for five weeks before they moved to Australia. The original deal was to have them pay $50 per week to pay for their expenses, but she said she felt guilty asking them to pay when they gifted her their 1996 Nissan Pulsar.

The car was repossessed last night. "I've got a kid with asthma who I often have to take to hospital in the middle of the night and now I've got no car. I sold my old one when they gave me theirs. I genuinely thought they were trying to be nice, caring friends," she said.

Mr Lopez said yesterday a repossession agent came to collect his car and, after receiving some legal advice from a Tauranga community law centre, he agreed to hand over the keys after removing his belongings from the vehicle.

Mr Lopez said yesterday the couple in Australia sent a text message to him that stated they are willing to refund the $4500 and will wire the money today once their urgent loan payment shows up in their bank account.

"I just hope the money does come through. I'm quite worried, and don't know what my wife and I will do if doesn't ..."

The Bay of Plenty Times tried contacting the couple in Australia but phone calls were unanswered. The other woman at the centre of this matter said she has sent text messages to the couple asking whether she was also going to get her money back, but has had no reply.

Oxford Finance was contacted but a spokeswoman said they were unable to comment due to privacy concerns.

Citizens Advice Bureau policy adviser Andrew Hubbard said if a car was being bought privately, checks should always be made to see if there was any finance owing.

"You can do this online, or via your cell phone. You can text the registration number and VIN of the car to 3463, and receive a YES/NO answer along with a SMS report code to enter online, this costs $3.

"Taking the time to do this simple check can save you a lot of trouble."

Trade Me communications and community spokesperson Jeff Hunkin said they also had problems with financed cars, but it wasn't a significant issue.

"If people have any concerns, the easiest way to let us know is to hit the sheriff's badge at the bottom of every listing page and we'll investigate."

Vehicle repossession

Anyone looking to purchase a vehicle should check the Personal Property Securities Register to see if there is any debt owing on it.