That new cars are expensive is a fact. The price you first see is always for the most basic, but you always have to add some extras that make it skyrocket and in the end you have to think about it. That is why many opt for second-hand or kilometer zero cars, which are somewhat cheaper. Now, do you know that repossessed cars are worth even less? Can you buy repossessed cars?
If you just discover this type of vehicles and they might interest you because of the very succulent price they have, first of all it must inform you of the situation of these cars. Shall we start?
What is a repossessed car?
The first thing you need to know is what a repossessed car is. Or, rather, why cars can be repossessed.
Car repossession is the situation that occurs when there is a non-payment by entities, such as the Treasury, banks, Social Security, City Councils, Courts... When payment is not made, these entities act on the assets one has and one of them is the car.
Now, You should know that embargoes can occur in two different ways:
- Executive, which is what a judge orders.
- Administrative, which is dictated by a Public Administration body (normally the Treasury, a City Council or Social Security).
What does it mean to have a car repossessed?
Many think that when you have a car repossessed, it is taken away from you until you pay the debt. But that's not really the case.
You'll see, According to the Mortgage Law, a seizure lasts about four years, with the possibility of extensions of another four years. After that time, it is no longer effective (it is as if it were eliminated).
To eliminate the embargo, in addition to waiting those four years for it to expire, the only thing you can do is pay the debt (so that it becomes your property again).
However, Just because a car is repossessed doesn't mean you can't use it. In fact, you can drive it, you can pass the MOT on it, take out insurance and even sell it.
Seized Car vs Sealed Car
Within embargoes you have to know that there are two types:
- The seized car is the case we are telling you about. A car that has been seized until the debt is paid, but that you can use without problem.
- A sealed car is a seized car that is also prohibited from being circulated or operated by one. In other words, you cannot access it. And if you do, the police will take it away from you or take it to a warehouse (so in addition to the debt you could have to pay for the time it spends in the warehouse).
Can you buy repossessed cars?
The quick and simple answer to this question is yes, you can. But you have to be careful.
Hay Two ways to buy repossessed cars:
- Through public or private auctions that are held.
- By purchasing from individuals who have the car repossessed.
The latter is the most problematic, since Many times sellers "overlook" this situation of the vehicle and buyers may find out at the moment when they are going to change ownership to the DGT. (if they go) or when they receive the seal or car removal notice.
Although the purchase in these cases is a fraud and it is recommended to report it, the procedures and problems it can cause are quite a few. So we do not recommend it.
If you are wondering how to know if a car has a seizure, the answer is simple: the DGT has the solution. If you go to this office with the car's data, they can tell you if there are charges on the vehicle. That way, you can continue with the transaction or end it at that time.
If you want to be on the safe side, auctions are best. But here too you face a series of risks. And, although cars are sold at prices much lower than what they would cost second-hand or new, and you have a wide variety available, many suffer from mechanical failures and major breakdowns, in addition to the fact that they may have many kilometers or added loads. (that is, they have more debts that the new buyer has to take care of).
What happens if they sell me a car with a repossession?
Let's make the following assumption: you have been talking to a person who wants to sell their car. The problem is that he never told you that it had a seizure (because at the end of the day the debt belongs to the owner, not the car, which is why he didn't tell you anything). And suddenly, you see a car that has some loads on it.
The first thing you should have done is request a report from the DGT. To do this, all you need is the car's license plate. At the DGT they will see if you have outstanding charges and debts on that vehicle, and also if it has the ITV in order, how many owners it has had...
Then The contract should have reflected that there is a debt on that car, and the conditions under which that debt is paid. Additionally, to be completely legal, the money obtained from the sale should be used to remove the car's repossession. And it must also be reflected in the contract.
If this has not been done It can be reported because it incurs a crime of removing assets and that implies fines and prison sentences.
Continuing with this assumption, imagine that the car is not only impounded, but also sealed. This implies that, when you want to change the ownership in Traffic, they will do it for you, but they will notify you that you do not have a circulation permit since that vehicle cannot circulate.
In that case, if you didn't know anything, the best thing is to report it for fraud and go to the court or entity that ordered the seizure to prove that you have only acted in good faith and that you have been deceived. You are also allowed to pay the debt (to use the car) and add it to the complaint you file. But You will not be sure of getting that money back.
Now that you know more about repossessed cars and if you can buy repossessed cars, would you make the decision to buy one like this?