Selling car under loan, what are the legal procedures?

**boyet_deleon** · April 7th, 2015 12:22 AM

Sirs followup question lang po, sensya na. In case may buyer ako na ipayout yung loan ko, yung kotse po sa bangko pa din nakapangalan until i pa release ang chattel at transfer of ownership sa karingal? Or nakapangalan pa din yun sa original na nakaloan? Pwede din po ba incase nakapangalan pa sa original na nagloan yung yung car e ilipat ng derecho yung name sa bibili?

Natatakot lang po kasi ako kung ang scenario, nabenta na yung kotse pero sa akin pa din naka name yung car, usually ata 2 weeks bago irelease ng bank yung mga documents. What if naaccidente yung buyer during this period, ako pa din po ba ang mananagot kahit may notarized deed of sale?

salamat po sa lahat

**CrusaderSix** · April 7th, 2015 09:37 AM

What about the PDC as a buyer?

Puwede replace yung mga PDC ng seller and replace it with my own dun sa bank?

Baka yung payments ko sa seller di aabot sa bangko

**boyet_deleon** · April 11th, 2015 11:00 AM

Question po sa mga nakapagbenta ng kotse under loan, na nagpapayout. After po bayaran ng buyer sa bangko yung loan, may nakaready na po ba kayong deed of sale, pirmahan and then pa notarized sa bank or sa notary public na lahat lahat? Yung buyer ba magtatago ng original copy? Magkano po usually inaabot notaryo? Yung acknowledgement receipt din po ba dapat notarized? Lastly sinamahan nyo pa po ba yung buyer para sa change of ownership? (ROD>Karingal>LTO). sensya na po dami ng tanong. Thanks everyone.

**dr. d** · April 11th, 2015 11:17 AM

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if i were me, i would go to the bank and ask them what documents are needed. involve them! they are the silver standard, are they not?
we can't very well keep the bank out of the picture until the very last second now, can we? after all, they hold the car documents in hock!

... are people actually afraid to go to the bank for advice?..

**machine.pistol** · April 11th, 2015 04:58 PM

Originally Posted by boyet_deleon

Question po sa mga nakapagbenta ng kotse under loan, na nagpapayout. After po bayaran ng buyer sa bangko yung loan, may nakaready na po ba kayong deed of sale, pirmahan and then pa notarized sa bank or sa notary public na lahat lahat? Yung buyer ba magtatago ng original copy? Magkano po usually inaabot notaryo? Yung acknowledgement receipt din po ba dapat notarized? Lastly sinamahan nyo pa po ba yung buyer para sa change of ownership? (ROD>Karingal>LTO). sensya na po dami ng tanong. Thanks everyone.

If you are the seller, get the buyer to pay the loan balance. The bank will need more time to release the documents (original OR and CR and original notarized release or cancellation of mortgage and Power of Attorney with respect to the release of mortgage) because the bank personnel who handled the account, who has custody of the docs and who receives payment are different.

The issue here is timing because the buyer has already released a portion of the purchase price by paying the loan balance to the bank. On the other hand, the seller is not ready to deliver the docs to the buyer. When does the seller deliver the original CR/OR, release of mortgage and signed deed of sale to the buyer? When does seller receive payment of the purchase price net of the loan balance from the buyer? When does seller deliver the car to the buyer? Obviously, all these transactions cannot happen at the same time.

So seller and buyer must discuss the timing. For example:

Buyer pays the loan balance to the bank for the account of the seller/borrower.

While waiting for the docs from the bank, the seller may deliver the car to the buyer (after all, the buyer has already parted with a portion of the purchase price paid to the bank).

In the meantime, the seller is waiting for buyer to pay the balance of the purchase price net of what the buyer has paid to the bank. So while seller has an unpaid portion of the purchase price, he can hold on to the deed of sale.

When the bank docs are ready, seller will then deliver the CR/OR, release of mortgage and signed and notarized deed of sale to the buyer, who, in exchange, will deliver the rest of the purchase price.

At this point in time, seller would have been paid in full while buyer would have received all the docs he can present to LTO to transfer the registration to his name as well as to cancel the mortgage encumbrance.

**fbcondejr** · April 28th, 2017 07:11 PM

Hi ,

I moving out of the country for good and I want to Sell my car (EcoSport 2016 -Trend) which is 1 year old and still in bank financing ( UCPB ). Can you advised me how can I sell it i tried to post it online but i think no one is interested , what would be my option if no one will buy it i don't have immediate family here that can take care of the car. What would be the consequences of repossession of my car if ever. Thanks

**shadow** · April 28th, 2017 09:34 PM

Originally Posted by fbcondejr

Hi ,

I moving out of the country for good and I want to Sell my car (EcoSport 2016 -Trend) which is 1 year old and still in bank financing ( UCPB ). Can you advised me how can I sell it i tried to post it online but i think no one is interested , what would be my option if no one will buy it i don't have immediate family here that can take care of the car. What would be the consequences of repossession of my car if ever. Thanks

For good? Then let the bank foreclosed your car or sell it at loss. Kahit mabayaran mo lang yun bank.

How much yun down mo and how much loan mo sa bank then Ila. Years pa?

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