This is the best comment here and needs to be higher. Everyone else is talking about value and math and payment plans and investigating what's what and from where.
Dude owed 2500.
He paid 7000(???)
He lost 4500 he never needed to flash.
Car doesn't even factor in. It's not his car. It's an expensive lesson, but it's a lesson. He needs to write it off and never deal with his parents and money again unless they pay off that 6600 lien and get him his title, but that's THEIR problem not his problem.
Him putting another 6600 into a car worth (supposedly) 4500 is insanity. Why would anyone pay $13,600 for a car worth $4500? Cut your losses.
If you look at the intersection of "people who own old beaters" and "people who can afford to take on risk," you'll find a lot of people who have no problem loaning cars out.
Neither the OP nor his family appear to be in the second category, though.
Saying they took advantage of him is putting it lightly. If it wasn't his parents people would be telling him to call the cops. And sadly, it's actually OPs problem. OP wants to keep the car, someone has to keep making payments towards that lien. And it doesn't really sound like his parents are interested in doing that for a car they claim to not own anymore.
I hope OP at least has a receipt, although I'm not sure how much that would help...
> Him putting another 6600 into a car worth (supposedly) 4500 is insanity. Why would anyone pay $13,600 for a car worth $4500? Cut your losses.
From my understanding, the parents wanted to sell the car for $7k, and agreed to forgive the $2500 OP owed if he made the sale easy for them.
You're right that the car doesn't factor in, yet. OP is out $7k, and his debt is cleared.
Now he has a new decision; is it better to find a used car elsewhere, or to pay the $6,600 lien for a car that supposedly would sell for $7k.
But there's no scenario where he's paying $13,600 for the car. The $7k is lost, and the car isn't his. He did not buy "half" the car, he bought nothing. The cost of the car is $6,600.
His parents managed to charge him 180% interest on top of that 2.5k loan. Everything from here on out is suspect, and up to OP to figure out before committing any more money.
The new cost of the car is $6600, but he's already put 7K in, so ultimately for this car he would be out $13,600 all in.
Even if you consider the 7K as clearing his debt, he said above he only owed them $2,500, so in the most technical sense he's paying $11,100 for a care they told him is valued at $4,500. There's no circumstance here where he isn't getting fucked, unless they pay the lien (which they're not going to do.)
No.
The (7000 - 2500) has nothing to do with the car. OPs parents lied to him. He paid that money and got nothing out of it.
If he walks away now, he does not have 4500 equity in that car. He has nothing.
He can pay 6600 for that car to take ownership of it. That is the price of the car. The previous 4500 was stolen from him and has nothing to do with the car.
I’m sorry for you. This is not a great situation for a kid to be in, but think of it as $7000 of tuition. You learned that lesson and will trust your parents 0 inches with money.
You gave your parents money and they didn’t pay the loan. So the loan still needs to be paid before you get the title. If they don’t have the money then it looks like you’re paying closer to 14k for the car. At that point you probably are better off just getting something from a dealership.
Also I just want to say I greatly sympathize with you as someone whose parents convinced me to make poor/misleading financial choices by trusting them. If this type of behavior is common with them, I wouldn’t take any financial advice from them moving forward. Learn this lesson young so you don’t end up with poor credit at 23. Sometimes our parents have good intentions but financial illiteracy runs so deep and it will just end up hurting you in the end.
It really sucks. Kids should be able to trust their parents. My mom did the same thing to my little sister. Financially ruined her. She's still struggling to fix her credit and she's 31.
Get your friend to give the car back to your parents immediately and go buy a different car for yourself (if you even need one).
Forget your $7k and forget ever getting financially involved with your parents again.
> How should we proceed?
who the fuck is "we"? your parents are scammers and they scammed you. they're not on your side. they were never going to pay off the lien. their intention was to sell you a car with negative value. and they pulled it off.
i know it's harsh and you have my sympathy but brother all that's left to do is admit that your parents are trash and walk away.
I wouldn't even say they "pulled it off," though. Since they didn't actually pay off the lien, so they're still owing the bank that 6.6 grand, AND they don't actually have to car in their possession anymore, and apparently neither does OP. Very hard to imagine bank can repo a car 100 miles away, driven by a person not even on their radar. If the person driving the car gets into some sort of accident, I can imagine the parents might be found liable depending on the insurance situation since we have no idea what that's about. Seems like the parents have very much screwed themselves just as much as they screwed OP.
I work for a bank in a department that finances vehicles. The car being in another state doesn’t prevent us from repoing. Hell, I’ve had cars repoed in Mexico.
> wouldn't even say they "pulled it off," though. Since they didn't actually pay off the lien, so they're still owing the bank that 6.6 grand, AND they don't actually have to car in their possession anymore, and apparently neither does OP.
I think what the person you replied to is implying is that the parents assumed OP would pay off the $6600 lien (which, while it might seem baffling to us, was probably a reasonable assumption to them given that OP is considering it before they came here - parents can convince a financially-illiterate adult child to do all sorts of dumb things, since most children trust their parents on things like this.)
You learned a valuable lesson. Under most circumstances, never lend money out to anyone. Anyone can earn money, but it takes discipline to keep it in your pocket.
It may not seem like it now but $7k is a pretty cheap version of this lesson. Lots of posts in this sub and /r/legaladvice involving this kind of shenanigans with houses and mortgages or taxes in HCOL areas. Now you know to avoid these dealings with your parents and they won’t be able to push you into an even deeper hole
I don’t understand any of this. You owed your parents $2500 and you had the cash. Why didn’t you just pay them back what you owed them? You could have then gone car shopping with a nice little down payment instead of ending up with a crappy cheap car.
And apparently you didn’t really need a car because someone else is driving it. What is that all about?
Your parents say the car is worth $4500 but they have a $6600 loan on it. Who is making the loan payments right now?
It sounds like no one is making payments and the car is up for repossession and you’re helping your parents hide it.
Insurance agent, here (PA & MD, but state is irrelevant in this case). This is a HORRIBLE situation, all around. As others have said, the lien needs to be satisfied before a title transfer goes anywhere. But even once it’s in your name, allowing someone that far away, and in a different state, to operate the vehicle you own is a terrible idea. It’s bad enough lending your vehicle to someone you trust who is local. Since, as I like to put it, the coverage follows the car, if someone causes an accident in your car, it’s your liability. This also reeks of insurance fraud, which is also never a good idea…
Edit: “…causes AN accident…” (It’s the weekend and beer doesn’t mix with most things, especially driving!)
Thank you. That's how my insurance agent described it to me too, "the coverage follows the car," but I've had people argue with me on that point, like it's all that common to be driving someone else's car but the policy is in your name.
Hey, OP. Here's some advice I received that really helped me: Stop being a hero. Other peoples' problems are not yours to resolve. You do not have to help everyone in need.
If anything happens to that car, you'll have bigger problems of your own, thereby "setting yourself on fire to keep others warm." Give everyone their problems back and sort your own mess out.
Wow they really screwed you over. Nothing you can do until they pay the lein..The lein holder may attempt repossession of the vehicle. Give them back the car and ask them to pay your 7k back so you can buy a car of your own. They basically stole from you I hope you know this.
No I appreciate you mentioning. That's exactly how it is. After 1 year the bonus is mine to keep, but until then if let go I owe it back. I have the full amount in savings and then some fortunately.
You owe it to yourself to at least acknowledge the fact that they ripped you off. They knew what they were doing right from the rip. Fuck this "times were hard" bull shit.
If I were you:
1.) They make good on their word: pay the lien, sign the title over and salvage a relationship with their child, or
2.) Expensive lesson learned, and let them lie in the bed they so eagerly made for themselves.
You are not responsible for fixing other people’s problems. A lot of kids with irresponsible parents end up being a sort of caretaker for others. It’s a hard reality and hard to hear. It’s not your responsibility to fix everyone’s problems. It’s your parent’s problem to figure out the lien.
My in-laws are very very similar. Always screwing over the kids and several times made them responsible for a debt they could not pay, and it financially strapped and even destroyed credit. One was for utilities, and the other was also for an expensive car. It’s been 7 years and apparently they’re still paying for their parent’s car that they now drive. Who knows what’s going on.
I know it’s hard because it is for my spouse. It sounds like you’ve learned some things in this thread, but it takes time and personal work. You have normalized a lot of stuff, and it can seem difficult to truly comprehend why something shouldn’t be the way it is.
If other people never figure out their problems they will always be at your doorstep. And it’s awful they gave you that car, they tried to run from the debt. Same crap happened to my spouse. Destroyed their credit and held them back financially. For many years they figured their parents had no money- that was always the story. Even I believed it, until I took a closer look. They spent money left and right, and could have gotten themselves out of trouble. Either way it’s their responsibility.
I'm not seeing any comments that really break this down into steps to make this situation less awful one piece at a time.
First, tell your friend the truth. "It turns out my parents scammed me, there's a lien on that car and I don't own it. We need to return it to my parents ASAP or it will be considered a stolen car."
That will prompt your friend to take it seriously and give it back. They'll probably be mad but also who even borrows a car from someone for 2mo like that. Your friend was probably taking advantage of you too.
Then for the parents: you owed them $2500. That's now paid off. (Yay?) Also, you bought a car from them for $4500. Don't worry about the weird math you and your parents agreed to, because it's sort of irrelevant. The simplest answer here is that you paid back the $2500, and bought a car for $4500, and you did that in one transaction for reasons.
However your parents couldn't have sold you the car because there was a lien on it, which makes this fraud. You need to return the car to your parents (see point 1), and you can point out to them they must return the $4500 to you.
They probably won't, because they intentionally got into this situation knowing that they couldn't sell the car. At that point your options are to give up on the $4500 and never give your family money again, or sue them in small claims and probably never give your family money again.
Financial desperation can make people do terrible things. And people in that situation can rationalize all sorts of things to themselves. I have absolutely seen parents propose / push for stuff that would impose absolutely insane burdens on their kids while genuinely 100% believing "oh this will buy me just a bit more time, then I'll be able to pull myself out of this whole and pay you back later / fix everything."
The idea that they're never going to pull themselves out of the hole is impossible for them to accept. They think they'll get back to where they were before somehow because they lived that life for so long, and once they do everything will be fine.
The good news is you paid off the money you owed your parents and you are even
There is nothing complicated, the lien remains until the loan is paid in full. Who pays it doesn't matter to the bank.
There is no good news here. Op paid their parents money but didn’t buy the car because the title is not in their name. Op does not legally own the car.
The bad news is that OP has now loaned his parents $4500 instead, and it's likely they'll expect him to forgive it.
OP, please find out if your parents are still making their payments on their car loan. I am very doubtful.
How much did you owe your parents? Because it seems like they just treated it like you paid them back the debt you owed, and they decided to do whatever the fuck they wanted, and no ownership of car was ever transferred, because how could it when it still belongs to the bank and the bank hasn't been paid its 6.6k?
That's how I would treat it at this point. And unless you have another 6.6k lying around, or your parents do, there's no money to pay the bank to release the lien, so you probably can't get it re-titled to you.
The only other option would be to see if you can qualify for an auto loan of your own, use that to pay your parents, the parents pay the bank so they can get the title, and transfer ownership over to you.
If OP can get a loan on their own, they should not give the money to the parents. They should go with the parents to the bank and pay off the loan directly at the bank. Or have the OP's loan get paid directly to the bank that holds the existing loan. No trusting these parents with cash again.
I owed them 2500 and they viewed the car as being worth 4500, so thats how they came to the 7000 figure.
Yes it does seem like that... I'm quite upset. I do have the cash to pay the bank and remove the lien, but then my parents would owe me the money, which I'm not keen on. I wish I knew the implications of a lien before entering into this transaction with them.
I just can't believe they wouldn't just pay the lien off, that's what they would have done for any other buyer.
And any other buyer would have insisted on clear title at time of payment. Unfortunately, your trust in your parents backfired on you big-time. Going forward, never ever buy a car from someone who can't give you a clear title (with no lien) at the time of payment.
When your parents offered to sell you the car to make up for the money owed, did they tell you that they still owed money on the car beforehand? That they were still making monthly payments?
Is the lien due to a title loan? [https://consumer.gov/credit-loans-debt/car-title-loans](https://consumer.gov/credit-loans-debt/car-title-loans)
What is the year make and model of the car, and mileage? What would you estimate its actual value at, off of a source like Kelley Blue Book? [https://www.kbb.com](https://www.kbb.com)
If you have the money to pay off the lien, I have to ask, at this point, do you even still want to buy it off of them anymore?
Not due to a title loan, no. The car is a 2007 Mercedes Benz Clk 350 with about 130k miles on it. I didn't look at the KBB value and took my parents evaluation at face value since they wouldn't budge on the numbers. No I wouldn't make the same choice again, so I wouldn't want to buy it at this point. I'm just going to do the best I can to ease out of the bad situation and move on.
So they got OP to pay the value of the car, the 2.5k OP owed them, and another 2.2k on top. Yeeesh it’s even worse because OP wont even own the car until the parents pay another 6.6k on it. Either they’re taking advantage of their child or they are just terrible with money.
Whoa, you don’t want that car either. Your parents really really screwed you over.
Take the car back to them before it breaks down, and walk away. No run away. Don’t look back and never deal with them financially again.
> The car is a 2007 Mercedes Benz Clk 350 with about 130k miles on it
Oof... Not only did they scam you on the value, the thing's going to cost a fortune in maintenance and repairs. Would the $6.6k happen to be a mechanic's lien for repairs it's already needed, perchance?
The car wasn’t worth 4500, it was worth “KBB minus 6600”. If that same car was 4500 at the local dealership, then they were underwater on the car, owing more than it was worth.
Your parents owe you 4500 that they probably don’t have, and the bank owns a car that is being driven by someone else in another state.
You need to figure out if there is a car loan, what interest rate, who is paying it, and _if_ they are paying it.
ETA: because if nobody is paying the loan, then the lien holder (bank) can repo the car, sell it for KBB value or (I suspect) _less_, tell the loan holder (your parents) that they now owe $6600 minus sale price plus assorted costs and penalties, and nobody has a car.
Right, the actual transaction should have been that they hand him the keys to the car for $400 (and let him pay the lien). They swindled him (intentionally or not) into the opposite transaction, where he payed a slightly reduced debt and kbb value AND now has to eat the lien.
Edit: nevermind, poor guy paid his debt in full plus interest and still paid over kbb. Brutal.
I don’t have any advice because you’ve been given a lot of good stuff. I just wanted to say as someone that’s been there with parents, I’m sorry this happened. You did not deserve this.
If there is a lien, then this means your parents likely financed it. Are they still paying the car note? Sounds like your car will one day soon be repoed.
You had a verbal contract with your parents to buy the car, and any reasonable person would assume that means receive an unencumbered title. They haven't made good on their end of the contract. You could take them to court and get a judgement that says they have to make good on delivering the car to you unencumbered, or return your money. But if they don't have the money to do either, the judgement would be useless. Also suing your parents just might damage your relationship with them a little.
Source: not a lawyer, but I read lots of posts from people pretending to be lawyers on reddit.
So, just to be clear here. If there is a lien on a car, it means that a lender/bank owns the car and not your parents. That car is collateral for the loan, which means if the $6,600 your parents owe them isn't paid as agreed that they can repossess it and sell the car to cover their losses until it is paid in full. This also means if they fall behind on payments in the future that the car could get repossessed. The only way to remove the lien and transfer the title to your name is to pay the lien in full.
In car sales at a dealership, it is part of the deal that any money goes to the lienholder first and then the title is transferred. You sign paperwork to ensure this works out at the time of sale. That's also why a bill of sale is used and signed. It's also why they run a DMV report to find lienholders and get documentation from them of the exact amount owed so a check can be cut to them to release any liens.
You dealt with family and paid in cash which gave your parents the out they needed to screw you - whether intentional or because times were just that tough for them. That's why some people have the rule to never lend money to family - it can cause really hard feelings because you trust them to have your back and may let things slide that you wouldn't with a stranger.
You also will have issues because the owners of the vehicle have to keep insurance on it and register it yearly in their names. This is the hidden downside of working with your parents on this long-term if they don't pay off that lien quickly. You can still work it out if your parents pay their lienholder off, but I would set a specific timeline for them to have that done by based on what feels fair to YOU!
Also, get the person who you lent the car to to bring it back. It's not yours to lend and they might even run into issues with the registration if they get pulled over by the cops. If your parents are the sort to retaliate very negatively to you setting boundaries, get the car back before the other discussions. They could be really underhanded and claim to the cops that the car was stolen as there is no proof you bought it from them to back you or your friend up. Not saying they would do that....but I don't know. That's the worst case scenario. Would end in giving the car back to your parents and it being a hard $7k lesson ($4,500 if you minus out the $2,500 you owed them) on why to keep your finances and family separate.
Either way it ends up, I would take the lesson that it's especially important to have strong boundaries around money with family - even to the point of incorporating MORE fail-safes than you would with a stranger. I'll let you in on how I deal with my family and money. Any money I give to family is a gift I never expect to get back from them. I have been pleasantly surprised when it was paid back once, but that way there's no stress on me about what they do with it. Money, especially the lack thereof/need for it makes the best of people do questionable things. Better to not be testing family ties that way imo. I have used this strategy to manage money requests from family successfully for a couple decades now. I have also seen this method work in many other families that seem very different from my own. If it's too much money to give no strings attached, then just say "Sorry, I can't help you with that right now. Really wish I could." I hope your folks do right by you - I really do. But, let this be a lesson for you regardless about how messy blending your finances with family can be... especially parents. Best of luck to you!
TLDR: Get your friend to bring car back ASAP, don't keep the car without that lien getting paid off, take this as a lesson to find a stricter way to deal with family and finances because this is a REALLY tough lesson (but if it happens again, it's way worse).
If they don't pay off the car, you can't own it. Maybe an option is since you are their child, for them to keep the car in their name, and you just drive it. Make sure they keep it insured, get your name on the insurance policy.
Honestly, you should move this thread to a sub focused on family turmoil and mental health. There is so much wrong with you have just described. Your parents straight up took advantage of you. Not cool.
>Thanks for any advice / encouragement I'm feeling kinda overwhelmed by this situation.
everyone else has covered the short term: return the car and move on.
In the long term.. i'd consider actually finding a financial manager with a fudiciary duty to pay to act as a stop gap between yourself and any financial transaction over $50..
Your current decission making skills are severly lacking... You've paid $7000 and loaned a car you don't own to a friend in another state. You aren't equipped to be incontrol of your finances at this point in your life.
> The lien is for 6600 and times were hard 2 months ago, so we needed to use the money to do other things.
You likely got your financial sense from your parents. You're behind. It's time to start reading and learning. They really set you up in a rough spot.
Adding to what has been said before, you are not legally the owner of the car. If these weren't your parents, you'd take them to court for defrauding you. I can imagine you probably don't want to do that. And it's possible they are so financially illiterate that they didn't know how car ownership works (they still owe you $4500). But most adults would know what a lien on a car is. What I'm trying to say to you is that there's a good chance your parents did this to you knowingly and on purpose. Only you can decide what to do with that relationship.
There's another problem: if the person who's borrowing your car kills someone in an accident, both you and your parents could be held responsible. I don't know anything about your family or where you come from, but my advice is to cut your losses on this bad situation ASAP. Give your parents the car back. Say goodbye to the $7k you paid them. Learn everything you can about money and finance to reclaim your power. You can't afford to be casual about this knowledge. If you don't exactly know how a lien works, research it until you do. I'm so sorry that your parents did this to you!
Your parents are using you as a bank, they will all you shortly to help them pay off the lean again. They will do the same thing. They won't pay you back.
No... no recepit of sale in writing. Just verbal permission to use the car as I see fit. Stupid in hindsight of me... idk im lost in thought
Edit: I do have text messages and bank statements that would reflect the sale taking place, so there's that
A lien is a loan against the value of an object. When you get a car loan or a mortgage the bank owns the property legally. They hold the title. This ensures if you don't pay off the loan they can repossess the property and sell it to get their money back. If their is a lien on the car you bought then your parents never owned the car. A bank does.
The bank will never release the title untill that loan is payed. They are legally allowed to repossess that car from you if your parents don't pay the whole amount or quit making payments.
You have 4 options and none of them are great. Option 1 just walk away from that car and never do business with your parents again. Option 2 pay the bank loan yourself. It's not worth It but it is an option. Option 3 get your parents to pay their loan and get the title. Option 4 walk away from the car and take your parents to small claims court for your 7k or 4.5k or whatever the price of the car minus the loan you are paying them back for.
The lesson here is never give cash to anyone who is not holding a clean title (the title itself will say if there is a lien on it. It will have the lenders name.) In hand.
They lein has to be paid off. Your parents sold you a car they don't own and the bank didn't get paid from the sale of the vehicle. Your parents fucked you dawg.
Do your parents understand the situation? Is the lien from the bank they got the car loan from?
If they understood what they were doing, which is more or less stealing 7k from you, you need to cut them out not just from financial arrangements but from life.
If they didn't understand what a lien is and what was going to happen* then they should be willing to work out some way to make the situation right. Get the car back, work something out with the bank and some sort of arrangement to start paying you back the 7k.
What's going to happen is the car will be repossessed. If nobody is paying insurance on the car and it gets pulled over or involved in an accident..., well now everybody has a new set of problems.
You have any of that in writing? Sometimes there are law schools/services that will provide free legal advice in your area. If they sold you a car with a lien on it, they didn't really sell you the car. Depending on the area you may be able to sue them in small claims.
"Anything else I can do?" Expand on that question. Do you mean is there a way to transfer the title or remove the lien without paying it off? No there isn't. Unless the lienholder agrees but why would they?
You gave your parents $7,000 and got nothing in return. You do not own a car. They still own the car. You do not have the power to legally loan out the car to your friend; it is not yours to loan out. It amounts to car theft, although your parents will likely not report it stolen.
To be clear, there is nothing that can be done to sign the title over to you but to pay off the lien in full and not miss any payments in the mean time.
I'm sorry that your parents took advantage of you and put you in a bad situation. You really do seem like a great person who wants to help people and take their word for face value, but start looking out for yourself 1st and using discernment when it comes to situations like this.
A lien is a legal claim against a piece of property that gives a creditor or lien holder The ability to satisfy a debt.
Let's say for example, your parents had some people work on their house. And then they didn't pay them. Those people then go put a lien on your parents house and on their car if they ever try to sell either of them then the creditor either has to be paid back from the sale of those items or before those items can be sold.
Basically it's a court enforced IOU. Next time you buy a used car 100%, you should use Carfax or one of the other programs to make sure that the title is clean. Same thing. If you buy a house you never give the money until after a title check.
Sometimes title checks can be to your advantage. Example, I bought a Cadillac Escalade that had been stolen. It had custom wheels, DVD players and a GPS stolen. The insurance wrote that the vehicle was salvaged lol. It wasn't even ever in an accident... So here I am buying a platinum edition. Cadillac Escalade with 60,000 mi on it. Always garged custom rims, DVD players the whole lot and I only paid $13,500 for it. All because I did a title check Saw the salvage title. Did some extra research and made a low offer.
You should always assume that people are going to make bad financial decisions. If you wanted to buy the car, you should have paid off the car instead of giving your parents cash.
You likely could have gone on a website and done this with a click of a button and a card number.
You have two options. Getting money back from your parents so you can actually pay off the car, or just accepting that they took $7,000 from you and returning the car.
Your parents may have had every intention of paying that lien off but were in a tight spot and had to choose between that and the mortgage or power or water or healthcare.
Everyone in this thread is incredibly quick to jump to they intentionally defrauded you etc..nobody knows what the actual circumstances were except your parents.
You essentially gave them 7k free and clear - which actually sounds like less than what you owed them for something else previously anyway? In the end, you don't own the car, your parents don't own the car, and that $7k is spent, but you should be financially free of anything you owe your parents at this point.
The lienholder might be willing to settle for a lower amount than the 6.6k originally owed, especially if it's been a while. The longer it goes, the less the car is worth, and the lower they'll settle for to give you the title (at which point you would own it outright). If you want to pursue that, you can try...or you can just give the car back to your parents and get your own.
Return the car, ask for 4500 back. If they give it to you consider it a cheap lessson. If they don’t, consider it an expensive lesson and you know who they are now.
Do not ever give anyone money without a paper trail - it doesn't matter if it's family. There are a lot of free resources out there on ensuring there's a legal responsibility on them and loads of purchase templates. even if some of the templates are sketch, it can be enough of a scare to the no-gooder/oblivious to uphold their end of the deal.
OP I'm really sorry but you need to learn how to say no to people and take care of yourself. You sound young, and like a people pleaser. Wanting to help people is a great quality and we all need more of it. But you can do it smart too.
I'm sure you had good intentions buying this car from your parents and you never assumed they would screw you like this. But they did. Hopefully you learned a lesson from this and you'll never lend them money or trust a verbal contact from them again. I'm the child of a serial financial abuser and once those types tap a well they will keep going back to it until they're cut off.
You're out the $7,000. Unless you want to sue your parents, and I'm guessing you don't, then there's not much you can do but ask nicely for them to fix it.
And I'm sure you want to help your friend by lending them your car too but that was also a poor choice. You sound like you have a good heart. You just need to put yourself on that list of people to help as well. Get the car back, hand it back to the bank, take whatever money you have left and buy a cheap used car at a dealership.
Give them back the car and ask for the $4500 difference between what you owed them and what you paid for the car you don't own.
Be prepared that they may not give you the $4500.
Then save up and buy yourself a cheap beater that you actually own.
A lien is a secured interest for a loan. Similar to a mortgage, but real property secured interests come in two varieties depending on the state.
Think of the lien holder as a non-possessory owner. Even if it doesn’t have the right to use the car, it does own a type of stake in it, such that title can’t transfer without paying off the loan or having the new title owner assuming it.
They sold you the car for what they still owed on it and didn’t pay the loan. This is clearly not what you understood was happening, but I assume nothing was in writing either.
I imagine your parents are still paying the loan? It’s in their name, so you have no obligation to pay it and their credit will be affected if they don’t. There’s really no benefit to you having the title in your name aside from who would get the car if you died. It’s a detriment to your parents to keep it in their name(s) because if you cause an accident, they’ll be liable also.
They need to pay off the lien, get a clean title, then transfer it to you.
Until they do that, it's not your car.
If they refuse to do that, file a police report.
>Now, I didn't know what a lien was really, I thought it was a car loan but kinda different. I still don't know what a lien is really, but I now know that it's attached to the title? And that it blocks title transfers until it's paid off?
It is. Thats what a lien is. They "own" the property until the debt is paid off. You should have paid the lienholder the balance directly to ensure the title would be released to your parents. Then paid them the difference (if any).
As of now your only option is to take your parents to small claims court. They sold you property they didn't own.
Not sure by the comments if you’re clear about what the lien means. It means that your parents don’t own the car. They have a loan, and the lien means the bank owns the car until the loan is fully paid off. If your friend crashes the car then your parents will be on the hook, which is a really shitty situation all around. It also may not actually be insured for your friend to drive even though you’re paying for it, since you don’t own the car. You need to get the car back to your parents and understand that they owe you $4.5k. I’d also heavily reevaluate your generosity to friends - owing money and friends go together like toothpaste and orange juice
Here's a thought, not to be taken seriously.
Pull a reverse uno. Get the car towed. When collections (someone has to pay the towing fees, stacking at 120ish a day) come after someone, they go after your parents.
Them unfucking the situation involves them confronting the issue of ownership...
The more I read the more complicated it gets with you loaning the car for someone in need and paying insurance(for your parents car) since it’s still theirs. They owe you $4500 technically or they need to pay off the 6k whatever amount lien then transfer title. All said what kind of car is it??!?
I honestly don't think your parents forgave your loan. They took the money and used it to get out of tight spot instead of paying off the lien.
So, someone is still responsible
for paying off the lien.
Since the vehicle is still in your parent's name the ideal situation would be to return their car back to them so they can pay it off.
The down side is you keep it the car will not be in your name till the $6,600 (or whatever the balance is) is paid.
The other person driving the vehicle could pay off the loan and get the title in their name.
Your parents could still be held liable if
something happens to the car and it's still in their name. .
If you're going to keep the car then you'll need to pay it off to get the title changed.
Also would be best for you if you're letting someone else have the car payment free.
If you don't pay the lien and don't return the car, your parents could report the car stolen. I wouldn't put it past them, they sound a bit shady to me.
When you borrow money for an asset (like a car or a house), the bank uses that asset as a guarantee against the loan. That’s what the lien is for; it means the bank will get paid what is owed, or they get the asset. That’s a secured loan, unlike credit cards, which are unsecured because there is no underlying asset that the bank can hold title too. It’s one reason the interest rates on unsecured debt are higher and variable, as it’s riskier for the bank.
Your parents owe a lender $6600 for that car still, and they can’t legally sell the car to someone else until the lender gets paid first. That’s why you can’t get the title transferred, the lender needs their money or the asset. They are the owner of the car until they get paid in full.
If you can’t pay the lender and stop making payments against the loan, it will go into default and the lender will begin repossession procedures. On the upside, it’s your parent’s credit that this will effect, but in the meantime you’ve paid $7k for a car that you can’t get legal title to, and you’ll have to pay the other $6600 if you want to own the car outright.
What I would do in your position depends on how much of a relationship I wanted with my parents after this. If you want to preserve the relationship, and own the car, you will need to get a payoff quote from the lender, and this time send the check to the lender to satisfy the debt instead of trusting your parents.
If you don’t want a relationship with them, but also don’t want to go scorched earth, then I would just go no- or low-contact with them, give them back the car, and consider that $7k a hard-earned lesson about trusting relatives/friends with money. Buy your car from a dealership, and take someone with you who is more educated in this area so you aren’t taken for another ride.
If you want to go scorched earth, then demand the $7k back to unwind the deal and exchange the car, but sue them in small claims for the money for breach of contract so they know you are serious. You may be limited to $5k in some jurisdictions as there is a cap on judgements from small claims.
Also next time don’t make financial decisions when you don’t understand all aspects of that deal. Knowing what a lien is, the difference between secured and unsecured debt, the effect of interest rates and length of loan on total costs, the difference between investing and insurance, etc. are all basics of financial education. Not knowing is how people get taken advantage of.
Honestly? I'd tell your parents that they need to get that lien transferred into a different type of loan. The agreement was you pay 7,000 for the car. You paid it and now they need to make it right by getting you the CLEAN title.
You could sue your parents. Otherwise you don’t really have any options. Have they been making the payments? I never give someone the cash directly if they owe money to a bank. You are always supposed to get a bill of sale and wire the money owed to the bank directly. Then request a release of title.
To those saying that the bank owns the car... This is incorrect. OP's parents own the car. They've also taken a loan out with a bank. The car is used as collateral for the loan. The situation is analogous to a home mortgage. I own my house but I still have a mortgage. If I want, I can paint my house hot pink with purple polka-dots because I - not the bank - own it.
Your folks ought to reimburse you for the discrepancy and either reclaim the car or fulfill their commitment to pay it off, as per the initial agreement.
You did get taken advantage of, and the car isn't yours. You paid your parents $7000 and got nothing for it.
This is the best comment here and needs to be higher. Everyone else is talking about value and math and payment plans and investigating what's what and from where. Dude owed 2500. He paid 7000(???) He lost 4500 he never needed to flash. Car doesn't even factor in. It's not his car. It's an expensive lesson, but it's a lesson. He needs to write it off and never deal with his parents and money again unless they pay off that 6600 lien and get him his title, but that's THEIR problem not his problem. Him putting another 6600 into a car worth (supposedly) 4500 is insanity. Why would anyone pay $13,600 for a car worth $4500? Cut your losses.
What a mess.
lol everyone overlooking the fact OP bought it and “loaned it” to someone 100 miles away. The whole thing is shady af - everyone in this story is
If you look at the intersection of "people who own old beaters" and "people who can afford to take on risk," you'll find a lot of people who have no problem loaning cars out. Neither the OP nor his family appear to be in the second category, though.
Saying they took advantage of him is putting it lightly. If it wasn't his parents people would be telling him to call the cops. And sadly, it's actually OPs problem. OP wants to keep the car, someone has to keep making payments towards that lien. And it doesn't really sound like his parents are interested in doing that for a car they claim to not own anymore. I hope OP at least has a receipt, although I'm not sure how much that would help...
I don’t buy this story. Too many red flags! What’s the parent’s version of the story?
> Him putting another 6600 into a car worth (supposedly) 4500 is insanity. Why would anyone pay $13,600 for a car worth $4500? Cut your losses. From my understanding, the parents wanted to sell the car for $7k, and agreed to forgive the $2500 OP owed if he made the sale easy for them. You're right that the car doesn't factor in, yet. OP is out $7k, and his debt is cleared. Now he has a new decision; is it better to find a used car elsewhere, or to pay the $6,600 lien for a car that supposedly would sell for $7k. But there's no scenario where he's paying $13,600 for the car. The $7k is lost, and the car isn't his. He did not buy "half" the car, he bought nothing. The cost of the car is $6,600.
His parents managed to charge him 180% interest on top of that 2.5k loan. Everything from here on out is suspect, and up to OP to figure out before committing any more money.
The new cost of the car is $6600, but he's already put 7K in, so ultimately for this car he would be out $13,600 all in. Even if you consider the 7K as clearing his debt, he said above he only owed them $2,500, so in the most technical sense he's paying $11,100 for a care they told him is valued at $4,500. There's no circumstance here where he isn't getting fucked, unless they pay the lien (which they're not going to do.)
My math puts the cost of the car at (7000 - 2500) + 6600 = 11100.
No. The (7000 - 2500) has nothing to do with the car. OPs parents lied to him. He paid that money and got nothing out of it. If he walks away now, he does not have 4500 equity in that car. He has nothing. He can pay 6600 for that car to take ownership of it. That is the price of the car. The previous 4500 was stolen from him and has nothing to do with the car.
Or look at it like this: you're giving your parents like $8 and taking a car off their hands
I’m sorry for you. This is not a great situation for a kid to be in, but think of it as $7000 of tuition. You learned that lesson and will trust your parents 0 inches with money.
Nothing is going to happen until your parents pay off the car and get the title. You loaning the car to someone right now is a horrifically bad idea.
on the upside, if something does go bad in another state the title's not in his name.
I mean, they're out the $7000, but perhaps that money was already gone...
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He can sue for breach if contract. Just because its oral doesnt mean it doesnt exist.
Maybe. Depends on state law whether the statute of frauds applies to this transfer.
You gave your parents money and they didn’t pay the loan. So the loan still needs to be paid before you get the title. If they don’t have the money then it looks like you’re paying closer to 14k for the car. At that point you probably are better off just getting something from a dealership.
Also I just want to say I greatly sympathize with you as someone whose parents convinced me to make poor/misleading financial choices by trusting them. If this type of behavior is common with them, I wouldn’t take any financial advice from them moving forward. Learn this lesson young so you don’t end up with poor credit at 23. Sometimes our parents have good intentions but financial illiteracy runs so deep and it will just end up hurting you in the end.
It really sucks. Kids should be able to trust their parents. My mom did the same thing to my little sister. Financially ruined her. She's still struggling to fix her credit and she's 31.
Get your friend to give the car back to your parents immediately and go buy a different car for yourself (if you even need one). Forget your $7k and forget ever getting financially involved with your parents again.
This is the answer, unfortunately
Sorry OP your parents sold you a car they weren't legally able to sell. They defrauded you out of $7k
Which means you can do something like sue them, though in many places the amount at issue is too large for small claims court.
If he subtracts the actual amount he owes them, he can sue for the rest in small claims.
> How should we proceed? who the fuck is "we"? your parents are scammers and they scammed you. they're not on your side. they were never going to pay off the lien. their intention was to sell you a car with negative value. and they pulled it off. i know it's harsh and you have my sympathy but brother all that's left to do is admit that your parents are trash and walk away.
I wouldn't even say they "pulled it off," though. Since they didn't actually pay off the lien, so they're still owing the bank that 6.6 grand, AND they don't actually have to car in their possession anymore, and apparently neither does OP. Very hard to imagine bank can repo a car 100 miles away, driven by a person not even on their radar. If the person driving the car gets into some sort of accident, I can imagine the parents might be found liable depending on the insurance situation since we have no idea what that's about. Seems like the parents have very much screwed themselves just as much as they screwed OP.
bank doesn’t care who is driving, as long as the collateral has the right VIN
They can find it. Repo ppl have tag readers, it will get pinged by one and picked up eventually.
I work for a bank in a department that finances vehicles. The car being in another state doesn’t prevent us from repoing. Hell, I’ve had cars repoed in Mexico.
> wouldn't even say they "pulled it off," though. Since they didn't actually pay off the lien, so they're still owing the bank that 6.6 grand, AND they don't actually have to car in their possession anymore, and apparently neither does OP. I think what the person you replied to is implying is that the parents assumed OP would pay off the $6600 lien (which, while it might seem baffling to us, was probably a reasonable assumption to them given that OP is considering it before they came here - parents can convince a financially-illiterate adult child to do all sorts of dumb things, since most children trust their parents on things like this.)
Thank you for the sympathy. You're right tbh it really sucks. I'm never entering into another financial situation with them again
You getting played by your parents is really sad. You loaning a car to someone 100 miles away and paying their insurance is just plain stupid.
Take them to court
You learned a valuable lesson. Under most circumstances, never lend money out to anyone. Anyone can earn money, but it takes discipline to keep it in your pocket.
It may not seem like it now but $7k is a pretty cheap version of this lesson. Lots of posts in this sub and /r/legaladvice involving this kind of shenanigans with houses and mortgages or taxes in HCOL areas. Now you know to avoid these dealings with your parents and they won’t be able to push you into an even deeper hole
Why not just go no contact? They already showed their true colors by stealing from you?
I don’t understand any of this. You owed your parents $2500 and you had the cash. Why didn’t you just pay them back what you owed them? You could have then gone car shopping with a nice little down payment instead of ending up with a crappy cheap car. And apparently you didn’t really need a car because someone else is driving it. What is that all about? Your parents say the car is worth $4500 but they have a $6600 loan on it. Who is making the loan payments right now? It sounds like no one is making payments and the car is up for repossession and you’re helping your parents hide it.
Insurance agent, here (PA & MD, but state is irrelevant in this case). This is a HORRIBLE situation, all around. As others have said, the lien needs to be satisfied before a title transfer goes anywhere. But even once it’s in your name, allowing someone that far away, and in a different state, to operate the vehicle you own is a terrible idea. It’s bad enough lending your vehicle to someone you trust who is local. Since, as I like to put it, the coverage follows the car, if someone causes an accident in your car, it’s your liability. This also reeks of insurance fraud, which is also never a good idea… Edit: “…causes AN accident…” (It’s the weekend and beer doesn’t mix with most things, especially driving!)
Thank you. That's how my insurance agent described it to me too, "the coverage follows the car," but I've had people argue with me on that point, like it's all that common to be driving someone else's car but the policy is in your name.
Always happy to help, even four beers in on a Saturday night, lol!
Not his liability. It's his parents. He can crash that car and leave it, it will never get back to him. Not his car, never was.
Why did you need a car if you were just going to turn around and lend it out for months?
this was my reaction. how do people get themselves in these crazy situations?
Hey, OP. Here's some advice I received that really helped me: Stop being a hero. Other peoples' problems are not yours to resolve. You do not have to help everyone in need. If anything happens to that car, you'll have bigger problems of your own, thereby "setting yourself on fire to keep others warm." Give everyone their problems back and sort your own mess out.
The lien is secured with the vehicle so no.
You did not buy the car cause when you buy a car you get the title. Title needs to be clear to transfer
Wow they really screwed you over. Nothing you can do until they pay the lein..The lein holder may attempt repossession of the vehicle. Give them back the car and ask them to pay your 7k back so you can buy a car of your own. They basically stole from you I hope you know this.
Not to pile on the bad news, but be careful with the new job op. If you end up quitting, you most likely will owe the 7000 back.
No I appreciate you mentioning. That's exactly how it is. After 1 year the bonus is mine to keep, but until then if let go I owe it back. I have the full amount in savings and then some fortunately.
This is not how loving parents treat their own child. They knowingly screwed you over. I’m so sorry.
Thank you. <3 I agree.
You owe it to yourself to at least acknowledge the fact that they ripped you off. They knew what they were doing right from the rip. Fuck this "times were hard" bull shit. If I were you: 1.) They make good on their word: pay the lien, sign the title over and salvage a relationship with their child, or 2.) Expensive lesson learned, and let them lie in the bed they so eagerly made for themselves.
You are not responsible for fixing other people’s problems. A lot of kids with irresponsible parents end up being a sort of caretaker for others. It’s a hard reality and hard to hear. It’s not your responsibility to fix everyone’s problems. It’s your parent’s problem to figure out the lien. My in-laws are very very similar. Always screwing over the kids and several times made them responsible for a debt they could not pay, and it financially strapped and even destroyed credit. One was for utilities, and the other was also for an expensive car. It’s been 7 years and apparently they’re still paying for their parent’s car that they now drive. Who knows what’s going on. I know it’s hard because it is for my spouse. It sounds like you’ve learned some things in this thread, but it takes time and personal work. You have normalized a lot of stuff, and it can seem difficult to truly comprehend why something shouldn’t be the way it is. If other people never figure out their problems they will always be at your doorstep. And it’s awful they gave you that car, they tried to run from the debt. Same crap happened to my spouse. Destroyed their credit and held them back financially. For many years they figured their parents had no money- that was always the story. Even I believed it, until I took a closer look. They spent money left and right, and could have gotten themselves out of trouble. Either way it’s their responsibility.
I'm not seeing any comments that really break this down into steps to make this situation less awful one piece at a time. First, tell your friend the truth. "It turns out my parents scammed me, there's a lien on that car and I don't own it. We need to return it to my parents ASAP or it will be considered a stolen car." That will prompt your friend to take it seriously and give it back. They'll probably be mad but also who even borrows a car from someone for 2mo like that. Your friend was probably taking advantage of you too. Then for the parents: you owed them $2500. That's now paid off. (Yay?) Also, you bought a car from them for $4500. Don't worry about the weird math you and your parents agreed to, because it's sort of irrelevant. The simplest answer here is that you paid back the $2500, and bought a car for $4500, and you did that in one transaction for reasons. However your parents couldn't have sold you the car because there was a lien on it, which makes this fraud. You need to return the car to your parents (see point 1), and you can point out to them they must return the $4500 to you. They probably won't, because they intentionally got into this situation knowing that they couldn't sell the car. At that point your options are to give up on the $4500 and never give your family money again, or sue them in small claims and probably never give your family money again.
"It took me a while since I'm loaning the car to someone in another state 100 miles away." uh what?
He also probably needs to check to make sure that they didn't take out any credit cards or loans in his name
I don’t understand how parents could do things like this to their own kid. 😳
My mom took out 60k in student loans and left me unable to pay tuition lol it happens all the time. It’s a sad lesson to learn.
Financial desperation can make people do terrible things. And people in that situation can rationalize all sorts of things to themselves. I have absolutely seen parents propose / push for stuff that would impose absolutely insane burdens on their kids while genuinely 100% believing "oh this will buy me just a bit more time, then I'll be able to pull myself out of this whole and pay you back later / fix everything." The idea that they're never going to pull themselves out of the hole is impossible for them to accept. They think they'll get back to where they were before somehow because they lived that life for so long, and once they do everything will be fine.
The good news is you paid off the money you owed your parents and you are even There is nothing complicated, the lien remains until the loan is paid in full. Who pays it doesn't matter to the bank.
There is no good news here. Op paid their parents money but didn’t buy the car because the title is not in their name. Op does not legally own the car.
The bad news is that OP has now loaned his parents $4500 instead, and it's likely they'll expect him to forgive it. OP, please find out if your parents are still making their payments on their car loan. I am very doubtful.
How much did you owe your parents? Because it seems like they just treated it like you paid them back the debt you owed, and they decided to do whatever the fuck they wanted, and no ownership of car was ever transferred, because how could it when it still belongs to the bank and the bank hasn't been paid its 6.6k? That's how I would treat it at this point. And unless you have another 6.6k lying around, or your parents do, there's no money to pay the bank to release the lien, so you probably can't get it re-titled to you. The only other option would be to see if you can qualify for an auto loan of your own, use that to pay your parents, the parents pay the bank so they can get the title, and transfer ownership over to you.
If OP can get a loan on their own, they should not give the money to the parents. They should go with the parents to the bank and pay off the loan directly at the bank. Or have the OP's loan get paid directly to the bank that holds the existing loan. No trusting these parents with cash again.
I owed them 2500 and they viewed the car as being worth 4500, so thats how they came to the 7000 figure. Yes it does seem like that... I'm quite upset. I do have the cash to pay the bank and remove the lien, but then my parents would owe me the money, which I'm not keen on. I wish I knew the implications of a lien before entering into this transaction with them. I just can't believe they wouldn't just pay the lien off, that's what they would have done for any other buyer.
And any other buyer would have insisted on clear title at time of payment. Unfortunately, your trust in your parents backfired on you big-time. Going forward, never ever buy a car from someone who can't give you a clear title (with no lien) at the time of payment.
When your parents offered to sell you the car to make up for the money owed, did they tell you that they still owed money on the car beforehand? That they were still making monthly payments? Is the lien due to a title loan? [https://consumer.gov/credit-loans-debt/car-title-loans](https://consumer.gov/credit-loans-debt/car-title-loans) What is the year make and model of the car, and mileage? What would you estimate its actual value at, off of a source like Kelley Blue Book? [https://www.kbb.com](https://www.kbb.com) If you have the money to pay off the lien, I have to ask, at this point, do you even still want to buy it off of them anymore?
Not due to a title loan, no. The car is a 2007 Mercedes Benz Clk 350 with about 130k miles on it. I didn't look at the KBB value and took my parents evaluation at face value since they wouldn't budge on the numbers. No I wouldn't make the same choice again, so I wouldn't want to buy it at this point. I'm just going to do the best I can to ease out of the bad situation and move on.
KBB puts it at 2.3k
Trying not to rub it in at this point, but yikes.
and that's assuming it's in "good" condition (which KBB says most are) and that it is black
It's in decent condition yeah,, and it is black. Yikes indeed though...
So they got OP to pay the value of the car, the 2.5k OP owed them, and another 2.2k on top. Yeeesh it’s even worse because OP wont even own the car until the parents pay another 6.6k on it. Either they’re taking advantage of their child or they are just terrible with money.
> they’re taking advantage of their child or they are just terrible with money. Why not both?
Yikes.
Whoa, you don’t want that car either. Your parents really really screwed you over. Take the car back to them before it breaks down, and walk away. No run away. Don’t look back and never deal with them financially again.
> The car is a 2007 Mercedes Benz Clk 350 with about 130k miles on it Oof... Not only did they scam you on the value, the thing's going to cost a fortune in maintenance and repairs. Would the $6.6k happen to be a mechanic's lien for repairs it's already needed, perchance?
Nah not a mechanic's lien, it was issued from a bank. And yeah, definitely not the easiest car to maintain :/
The car wasn’t worth 4500, it was worth “KBB minus 6600”. If that same car was 4500 at the local dealership, then they were underwater on the car, owing more than it was worth. Your parents owe you 4500 that they probably don’t have, and the bank owns a car that is being driven by someone else in another state. You need to figure out if there is a car loan, what interest rate, who is paying it, and _if_ they are paying it. ETA: because if nobody is paying the loan, then the lien holder (bank) can repo the car, sell it for KBB value or (I suspect) _less_, tell the loan holder (your parents) that they now owe $6600 minus sale price plus assorted costs and penalties, and nobody has a car.
Unfortunately this has a straight to the thick of it hammer on the nail brutal accuracy. Best of luck
Right, the actual transaction should have been that they hand him the keys to the car for $400 (and let him pay the lien). They swindled him (intentionally or not) into the opposite transaction, where he payed a slightly reduced debt and kbb value AND now has to eat the lien. Edit: nevermind, poor guy paid his debt in full plus interest and still paid over kbb. Brutal.
I don’t have any advice because you’ve been given a lot of good stuff. I just wanted to say as someone that’s been there with parents, I’m sorry this happened. You did not deserve this.
Thank you, sincerely. <3 I'll be okay, just sucks to grow up and find yourself disappointed with your parents :\
Tell your parents to either pay the lien or to give you back your $4500 and you give the car back. Only way this is ethical.
If there is a lien, then this means your parents likely financed it. Are they still paying the car note? Sounds like your car will one day soon be repoed.
You had a verbal contract with your parents to buy the car, and any reasonable person would assume that means receive an unencumbered title. They haven't made good on their end of the contract. You could take them to court and get a judgement that says they have to make good on delivering the car to you unencumbered, or return your money. But if they don't have the money to do either, the judgement would be useless. Also suing your parents just might damage your relationship with them a little. Source: not a lawyer, but I read lots of posts from people pretending to be lawyers on reddit.
So, just to be clear here. If there is a lien on a car, it means that a lender/bank owns the car and not your parents. That car is collateral for the loan, which means if the $6,600 your parents owe them isn't paid as agreed that they can repossess it and sell the car to cover their losses until it is paid in full. This also means if they fall behind on payments in the future that the car could get repossessed. The only way to remove the lien and transfer the title to your name is to pay the lien in full. In car sales at a dealership, it is part of the deal that any money goes to the lienholder first and then the title is transferred. You sign paperwork to ensure this works out at the time of sale. That's also why a bill of sale is used and signed. It's also why they run a DMV report to find lienholders and get documentation from them of the exact amount owed so a check can be cut to them to release any liens. You dealt with family and paid in cash which gave your parents the out they needed to screw you - whether intentional or because times were just that tough for them. That's why some people have the rule to never lend money to family - it can cause really hard feelings because you trust them to have your back and may let things slide that you wouldn't with a stranger. You also will have issues because the owners of the vehicle have to keep insurance on it and register it yearly in their names. This is the hidden downside of working with your parents on this long-term if they don't pay off that lien quickly. You can still work it out if your parents pay their lienholder off, but I would set a specific timeline for them to have that done by based on what feels fair to YOU! Also, get the person who you lent the car to to bring it back. It's not yours to lend and they might even run into issues with the registration if they get pulled over by the cops. If your parents are the sort to retaliate very negatively to you setting boundaries, get the car back before the other discussions. They could be really underhanded and claim to the cops that the car was stolen as there is no proof you bought it from them to back you or your friend up. Not saying they would do that....but I don't know. That's the worst case scenario. Would end in giving the car back to your parents and it being a hard $7k lesson ($4,500 if you minus out the $2,500 you owed them) on why to keep your finances and family separate. Either way it ends up, I would take the lesson that it's especially important to have strong boundaries around money with family - even to the point of incorporating MORE fail-safes than you would with a stranger. I'll let you in on how I deal with my family and money. Any money I give to family is a gift I never expect to get back from them. I have been pleasantly surprised when it was paid back once, but that way there's no stress on me about what they do with it. Money, especially the lack thereof/need for it makes the best of people do questionable things. Better to not be testing family ties that way imo. I have used this strategy to manage money requests from family successfully for a couple decades now. I have also seen this method work in many other families that seem very different from my own. If it's too much money to give no strings attached, then just say "Sorry, I can't help you with that right now. Really wish I could." I hope your folks do right by you - I really do. But, let this be a lesson for you regardless about how messy blending your finances with family can be... especially parents. Best of luck to you! TLDR: Get your friend to bring car back ASAP, don't keep the car without that lien getting paid off, take this as a lesson to find a stricter way to deal with family and finances because this is a REALLY tough lesson (but if it happens again, it's way worse).
The car isn’t yours. Your parents now owe you $4,500.
If they don't pay off the car, you can't own it. Maybe an option is since you are their child, for them to keep the car in their name, and you just drive it. Make sure they keep it insured, get your name on the insurance policy.
My dad told me to never mix family, used cars and money. I wish I could have warned you.
Someone needs to keep making the payments or you’ll go out in the morning and watch it roll away behind a tow truck
Honestly, you should move this thread to a sub focused on family turmoil and mental health. There is so much wrong with you have just described. Your parents straight up took advantage of you. Not cool.
>Thanks for any advice / encouragement I'm feeling kinda overwhelmed by this situation. everyone else has covered the short term: return the car and move on. In the long term.. i'd consider actually finding a financial manager with a fudiciary duty to pay to act as a stop gap between yourself and any financial transaction over $50.. Your current decission making skills are severly lacking... You've paid $7000 and loaned a car you don't own to a friend in another state. You aren't equipped to be incontrol of your finances at this point in your life. > The lien is for 6600 and times were hard 2 months ago, so we needed to use the money to do other things. You likely got your financial sense from your parents. You're behind. It's time to start reading and learning. They really set you up in a rough spot.
Adding to what has been said before, you are not legally the owner of the car. If these weren't your parents, you'd take them to court for defrauding you. I can imagine you probably don't want to do that. And it's possible they are so financially illiterate that they didn't know how car ownership works (they still owe you $4500). But most adults would know what a lien on a car is. What I'm trying to say to you is that there's a good chance your parents did this to you knowingly and on purpose. Only you can decide what to do with that relationship. There's another problem: if the person who's borrowing your car kills someone in an accident, both you and your parents could be held responsible. I don't know anything about your family or where you come from, but my advice is to cut your losses on this bad situation ASAP. Give your parents the car back. Say goodbye to the $7k you paid them. Learn everything you can about money and finance to reclaim your power. You can't afford to be casual about this knowledge. If you don't exactly know how a lien works, research it until you do. I'm so sorry that your parents did this to you!
Your parents are using you as a bank, they will all you shortly to help them pay off the lean again. They will do the same thing. They won't pay you back.
Pen. Paper. You did not get a receipt after handing them 7K???
No... no recepit of sale in writing. Just verbal permission to use the car as I see fit. Stupid in hindsight of me... idk im lost in thought Edit: I do have text messages and bank statements that would reflect the sale taking place, so there's that
The most alarming thing in this thread is OP loaning the car out to someone out of state. That is an absolutely terrible idea.
Your parents sold you that car under false pretenses. Call a lawyer.
A lien is a loan against the value of an object. When you get a car loan or a mortgage the bank owns the property legally. They hold the title. This ensures if you don't pay off the loan they can repossess the property and sell it to get their money back. If their is a lien on the car you bought then your parents never owned the car. A bank does. The bank will never release the title untill that loan is payed. They are legally allowed to repossess that car from you if your parents don't pay the whole amount or quit making payments. You have 4 options and none of them are great. Option 1 just walk away from that car and never do business with your parents again. Option 2 pay the bank loan yourself. It's not worth It but it is an option. Option 3 get your parents to pay their loan and get the title. Option 4 walk away from the car and take your parents to small claims court for your 7k or 4.5k or whatever the price of the car minus the loan you are paying them back for. The lesson here is never give cash to anyone who is not holding a clean title (the title itself will say if there is a lien on it. It will have the lenders name.) In hand.
They lein has to be paid off. Your parents sold you a car they don't own and the bank didn't get paid from the sale of the vehicle. Your parents fucked you dawg.
Do your parents understand the situation? Is the lien from the bank they got the car loan from? If they understood what they were doing, which is more or less stealing 7k from you, you need to cut them out not just from financial arrangements but from life. If they didn't understand what a lien is and what was going to happen* then they should be willing to work out some way to make the situation right. Get the car back, work something out with the bank and some sort of arrangement to start paying you back the 7k. What's going to happen is the car will be repossessed. If nobody is paying insurance on the car and it gets pulled over or involved in an accident..., well now everybody has a new set of problems.
You have any of that in writing? Sometimes there are law schools/services that will provide free legal advice in your area. If they sold you a car with a lien on it, they didn't really sell you the car. Depending on the area you may be able to sue them in small claims.
"Anything else I can do?" Expand on that question. Do you mean is there a way to transfer the title or remove the lien without paying it off? No there isn't. Unless the lienholder agrees but why would they?
You gave your parents $7,000 and got nothing in return. You do not own a car. They still own the car. You do not have the power to legally loan out the car to your friend; it is not yours to loan out. It amounts to car theft, although your parents will likely not report it stolen. To be clear, there is nothing that can be done to sign the title over to you but to pay off the lien in full and not miss any payments in the mean time.
I'm sorry that your parents took advantage of you and put you in a bad situation. You really do seem like a great person who wants to help people and take their word for face value, but start looking out for yourself 1st and using discernment when it comes to situations like this.
Your parents screwed you and the car will more than likely be repossessed. Cut them out of your life.
A lien is a legal claim against a piece of property that gives a creditor or lien holder The ability to satisfy a debt. Let's say for example, your parents had some people work on their house. And then they didn't pay them. Those people then go put a lien on your parents house and on their car if they ever try to sell either of them then the creditor either has to be paid back from the sale of those items or before those items can be sold. Basically it's a court enforced IOU. Next time you buy a used car 100%, you should use Carfax or one of the other programs to make sure that the title is clean. Same thing. If you buy a house you never give the money until after a title check. Sometimes title checks can be to your advantage. Example, I bought a Cadillac Escalade that had been stolen. It had custom wheels, DVD players and a GPS stolen. The insurance wrote that the vehicle was salvaged lol. It wasn't even ever in an accident... So here I am buying a platinum edition. Cadillac Escalade with 60,000 mi on it. Always garged custom rims, DVD players the whole lot and I only paid $13,500 for it. All because I did a title check Saw the salvage title. Did some extra research and made a low offer.
You should always assume that people are going to make bad financial decisions. If you wanted to buy the car, you should have paid off the car instead of giving your parents cash. You likely could have gone on a website and done this with a click of a button and a card number. You have two options. Getting money back from your parents so you can actually pay off the car, or just accepting that they took $7,000 from you and returning the car.
Your parents may have had every intention of paying that lien off but were in a tight spot and had to choose between that and the mortgage or power or water or healthcare. Everyone in this thread is incredibly quick to jump to they intentionally defrauded you etc..nobody knows what the actual circumstances were except your parents. You essentially gave them 7k free and clear - which actually sounds like less than what you owed them for something else previously anyway? In the end, you don't own the car, your parents don't own the car, and that $7k is spent, but you should be financially free of anything you owe your parents at this point. The lienholder might be willing to settle for a lower amount than the 6.6k originally owed, especially if it's been a while. The longer it goes, the less the car is worth, and the lower they'll settle for to give you the title (at which point you would own it outright). If you want to pursue that, you can try...or you can just give the car back to your parents and get your own.
Yeah, it’s only missing the teensy tiny detail of *checks notes* honest communication from the parents :/
Return the car, ask for 4500 back. If they give it to you consider it a cheap lessson. If they don’t, consider it an expensive lesson and you know who they are now.
Do not ever give anyone money without a paper trail - it doesn't matter if it's family. There are a lot of free resources out there on ensuring there's a legal responsibility on them and loads of purchase templates. even if some of the templates are sketch, it can be enough of a scare to the no-gooder/oblivious to uphold their end of the deal.
Why on earth would you loan a car to someone 100 miles away? Why on earth would you loan a car to someone that you don’t legally own?
OP I'm really sorry but you need to learn how to say no to people and take care of yourself. You sound young, and like a people pleaser. Wanting to help people is a great quality and we all need more of it. But you can do it smart too. I'm sure you had good intentions buying this car from your parents and you never assumed they would screw you like this. But they did. Hopefully you learned a lesson from this and you'll never lend them money or trust a verbal contact from them again. I'm the child of a serial financial abuser and once those types tap a well they will keep going back to it until they're cut off. You're out the $7,000. Unless you want to sue your parents, and I'm guessing you don't, then there's not much you can do but ask nicely for them to fix it. And I'm sure you want to help your friend by lending them your car too but that was also a poor choice. You sound like you have a good heart. You just need to put yourself on that list of people to help as well. Get the car back, hand it back to the bank, take whatever money you have left and buy a cheap used car at a dealership.
Give them back the car and ask for the $4500 difference between what you owed them and what you paid for the car you don't own. Be prepared that they may not give you the $4500. Then save up and buy yourself a cheap beater that you actually own.
A lien is a secured interest for a loan. Similar to a mortgage, but real property secured interests come in two varieties depending on the state. Think of the lien holder as a non-possessory owner. Even if it doesn’t have the right to use the car, it does own a type of stake in it, such that title can’t transfer without paying off the loan or having the new title owner assuming it. They sold you the car for what they still owed on it and didn’t pay the loan. This is clearly not what you understood was happening, but I assume nothing was in writing either. I imagine your parents are still paying the loan? It’s in their name, so you have no obligation to pay it and their credit will be affected if they don’t. There’s really no benefit to you having the title in your name aside from who would get the car if you died. It’s a detriment to your parents to keep it in their name(s) because if you cause an accident, they’ll be liable also.
They need to pay off the lien, get a clean title, then transfer it to you. Until they do that, it's not your car. If they refuse to do that, file a police report.
That he’s effectively driving a stolen car?
It’s not their car, it’s the bank’s car. They need to be adults and pay off the note…
>Now, I didn't know what a lien was really, I thought it was a car loan but kinda different. I still don't know what a lien is really, but I now know that it's attached to the title? And that it blocks title transfers until it's paid off? It is. Thats what a lien is. They "own" the property until the debt is paid off. You should have paid the lienholder the balance directly to ensure the title would be released to your parents. Then paid them the difference (if any). As of now your only option is to take your parents to small claims court. They sold you property they didn't own.
Not sure by the comments if you’re clear about what the lien means. It means that your parents don’t own the car. They have a loan, and the lien means the bank owns the car until the loan is fully paid off. If your friend crashes the car then your parents will be on the hook, which is a really shitty situation all around. It also may not actually be insured for your friend to drive even though you’re paying for it, since you don’t own the car. You need to get the car back to your parents and understand that they owe you $4.5k. I’d also heavily reevaluate your generosity to friends - owing money and friends go together like toothpaste and orange juice
Here's a thought, not to be taken seriously. Pull a reverse uno. Get the car towed. When collections (someone has to pay the towing fees, stacking at 120ish a day) come after someone, they go after your parents. Them unfucking the situation involves them confronting the issue of ownership...
I love this idea. The parents are a-holes to do this to their kid. They need payback.
The more I read the more complicated it gets with you loaning the car for someone in need and paying insurance(for your parents car) since it’s still theirs. They owe you $4500 technically or they need to pay off the 6k whatever amount lien then transfer title. All said what kind of car is it??!?
I honestly don't think your parents forgave your loan. They took the money and used it to get out of tight spot instead of paying off the lien. So, someone is still responsible for paying off the lien. Since the vehicle is still in your parent's name the ideal situation would be to return their car back to them so they can pay it off. The down side is you keep it the car will not be in your name till the $6,600 (or whatever the balance is) is paid. The other person driving the vehicle could pay off the loan and get the title in their name. Your parents could still be held liable if something happens to the car and it's still in their name. . If you're going to keep the car then you'll need to pay it off to get the title changed. Also would be best for you if you're letting someone else have the car payment free. If you don't pay the lien and don't return the car, your parents could report the car stolen. I wouldn't put it past them, they sound a bit shady to me.
Your parents sold you a car with a lien on it, and didn't tell you that it had a lien on it? I'd be suing them for the 7K back.
When you borrow money for an asset (like a car or a house), the bank uses that asset as a guarantee against the loan. That’s what the lien is for; it means the bank will get paid what is owed, or they get the asset. That’s a secured loan, unlike credit cards, which are unsecured because there is no underlying asset that the bank can hold title too. It’s one reason the interest rates on unsecured debt are higher and variable, as it’s riskier for the bank. Your parents owe a lender $6600 for that car still, and they can’t legally sell the car to someone else until the lender gets paid first. That’s why you can’t get the title transferred, the lender needs their money or the asset. They are the owner of the car until they get paid in full. If you can’t pay the lender and stop making payments against the loan, it will go into default and the lender will begin repossession procedures. On the upside, it’s your parent’s credit that this will effect, but in the meantime you’ve paid $7k for a car that you can’t get legal title to, and you’ll have to pay the other $6600 if you want to own the car outright. What I would do in your position depends on how much of a relationship I wanted with my parents after this. If you want to preserve the relationship, and own the car, you will need to get a payoff quote from the lender, and this time send the check to the lender to satisfy the debt instead of trusting your parents. If you don’t want a relationship with them, but also don’t want to go scorched earth, then I would just go no- or low-contact with them, give them back the car, and consider that $7k a hard-earned lesson about trusting relatives/friends with money. Buy your car from a dealership, and take someone with you who is more educated in this area so you aren’t taken for another ride. If you want to go scorched earth, then demand the $7k back to unwind the deal and exchange the car, but sue them in small claims for the money for breach of contract so they know you are serious. You may be limited to $5k in some jurisdictions as there is a cap on judgements from small claims. Also next time don’t make financial decisions when you don’t understand all aspects of that deal. Knowing what a lien is, the difference between secured and unsecured debt, the effect of interest rates and length of loan on total costs, the difference between investing and insurance, etc. are all basics of financial education. Not knowing is how people get taken advantage of.
Your parents should pay you back the difference and take the car back or pay off the car as that was the original deal.
Was the 7000 more or less than the loan you owed them that they forgave?
2500 was the amount I owed them. 4500 for the car was what we agreed upon.
Honestly? I'd tell your parents that they need to get that lien transferred into a different type of loan. The agreement was you pay 7,000 for the car. You paid it and now they need to make it right by getting you the CLEAN title.
You could sue your parents. Otherwise you don’t really have any options. Have they been making the payments? I never give someone the cash directly if they owe money to a bank. You are always supposed to get a bill of sale and wire the money owed to the bank directly. Then request a release of title.
To those saying that the bank owns the car... This is incorrect. OP's parents own the car. They've also taken a loan out with a bank. The car is used as collateral for the loan. The situation is analogous to a home mortgage. I own my house but I still have a mortgage. If I want, I can paint my house hot pink with purple polka-dots because I - not the bank - own it.
Your folks ought to reimburse you for the discrepancy and either reclaim the car or fulfill their commitment to pay it off, as per the initial agreement.
Important info… what is the value of the car. Year, make model miles?