March 22, 2007

Hello Tony

I was reading through your website and I found some interesting pieces of information. I just bought a new Nissan Sentra from Antwerpen Nissan in Baltimore, MD. I had a 98 Ford Contour with a blown transmission and I owed about $4,000 on the vehicle.

I got approved for a loan and was told that they could pay off my Contour. However, I didn't know too much about the paperwork and apparently the $4,000 credit went to the new finance company, but my car was not paid off.

I already got an inquiry on my credit because they waited so long. Then they wanted me to somehow put a lien on the new car for the old car, but I didn't understand what they met by that. They had been back and forth with the Finance Company. Finally, they said they were going to pay off my car. However, until it is actually done I am going to stay on them. I will also call Nissan like you suggested if I have to.

From now on, I am going to make sure I get everything in writing.

C.N.

Answer:

Hi C.N.,

Remember, it's the car dealer who is responsible for paying off your trade-in. The pay-off amount is added to your new loan, but the dealer is the one who gets the proceeds from the loan. They then have to turn around and pay off the old loan out of those proceeds. It's imperative that you stay on their butts until they fulfill their obligation.

The car dealer is also responsible for transferring the title for the new car into your name, and for putting a lien on it for the amount of the loan. The lien is in the name of the bank, in case you default on the loan they can take the car and sell it.

You shouldn't have to do any of that yourself unless the car dealer is completely inept.

All my very best...

Tony Iorio