I'm buying a car from a private seller that still has a small note to Wells Fargo. So without him having the title in hand, what's the drill and what to be weary of? Also how does the DMV calculate the new tax I'll have to pay?
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Car purchase question
- Thread starter Shovelhead
- Start date
Cash sale about $11K
Go with them to Wells Fargo, pay off the note as part of the purchase and have the title sent to you..As long as you get a bill of sale, and a letter from the bank that the loan is payed in full.
You should get him ( provided this is a person you trust) to call wells Fargo and get a 30 Day Payoff Amount. That's what is owed on it right now before the next payment is due and interest accrues. That way you know exactly what you will have to pay for the car. The title will be sent to whoever WF has listed as the buyer unless you can get everyone on the phone and arrange otherwise. This is the only part I would be nervous about.
Go with him to Wells Fargo to pay off the loan. Dmv uses a fair market value from KBB or something similar. Tax is 6.75% of that value. you can't get a tag untill the state does their paperwork, usually about 30 days so you need a temporary tag from the tag office. Its to much work for most people so they buy at a dealership as the law was designed to force you to do. Hurray for autodealer lobbiest they earned their money while stealing ours.
Since the lien is held by Wells Fargo, it should be easy. Just agree on a sales price, draw up a bill of sale, and set up a closing at a local Wells branch. You can sign the BoS there and they will likely even notarize it for you (not really necessary in this case though). You will pay Wells Fargo the payoff amount and the seller gets his cut. Wells Fargo will then mail you the title within a couple of weeks.
He cannot legally transfer the title to you unless he pays off the lien first.
He cannot legally transfer the title to you unless he pays off the lien first.
Once you receive the title in the mail, it will be in your name and you take it to the tag office. You will pay $18 registration, $20 tag, plus 6.75% of the NADA book value (clean trade in or retail, I forgot). Anyhow, if that value shows as $10,000, you will owe $675 + $38 to get a tag.
Yeah the part about not having the title in hand makes me think twice. The guy lives in my sub division. Selling a 2005 Jeep Sport looks very clean, paint very little wear, lifted, new tires, 1 y.o. top, aftermarket front & rear tube bumpers, 90K miles, inline 6, automatic. $11.5K He started at $13K and from my search most 2005 are $14-15K.
Doesn't matter since Wells Fargo has the title. They're not going to shaft you like an individual could. If it was a different scenario, I would require the seller pay off the loan first and have title in hand before buying it. Or setup an escrow account for the transaction, or even have the seller sign a power of attorney for right to the title. It gets tricky when there is a lien, but if a well known bank or credit union holds the lien, it's very easy.
If you think it's a good deal, don't let that stop you in this case. I've bought my last three vehicles cash and two have had bank liens.
