If the car you buy has excellent financing, then you could lose the vehicle at the end. When a car is purchased from financial resources, the lender owns the vehicle until the debt is settled. It is only when the last payment is made in accordance with the financing agreement that the vehicle becomes the property of the borrower. If you don`t do a financial check before you buy a vehicle, you may end up buying a vehicle that doesn`t legally belong to you. This means that even if you buy the vehicle without knowing it, and with the best of intentions, there is still a chance that the lender would take possession of it again. You could lose both the car and the money you paid for the vehicle. When an official beneficiary is dealing with a vehicle that is the subject of a financing agreement, he should send the standard letter [Note 2] to determine the nature of the agreement (i.e. whether it is a simple credit contract or a conditional sale agreement – see point 31.2.24) and the amount required to pay the agreement. For both IPCH controls, financial control is included by default to ensure security.
A vehicle finance cheque identifies all the pending financing agreements that remain on the vehicle and lets you know if it is safe to buy. A full review of the IPCH will also give you more details, including the date and nature of the agreement, with which financial company and with what contact information. An agreement in which the lender retains no rights to the vehicle is usually a simple loan and is generally referred to as a “credit agreement” on the corresponding documents. It can be arranged directly by the borrower through a “High Street” lender or through a specialized lender by a car dealership on behalf of the borrower. If in doubt, the official beneficiary should verify the terms of the agreement to confirm that the lender does not retain any ownership rights. At the end of a rental period (see item 31.2.32), the vehicle is normally returned to the leasing company, but may contain a clause in the agreement that gives the purchaser the right to purchase the vehicle (sometimes at a pre-agreed price).