used boat purchase invoving bankruptcy

[meinjo]

What is the name of your state?alabama

Hey everyone,
I am considering buying a used boat from an individual who filed chapter 13
several years ago. The boat has a loan against it. I will be paying cash and
not financing it myself. Is it simply a matter of paying the lender off and paying the individual the remainder of his equity? What should I watch out for
here? If it matters, the finance company is out of state.

Thanks!
D

 

[Ladynred]

Paying off the loan is not YOUR problem, its the problem of the guy who is selling the boat. If he can't get enough for it to cover what's owed, then HE will be on the hook to pay off what's left -- unless the debt was discharged in his bankruptcy.

The only other wrinkle would be the title - if its required. The title won't be freed up until the loan is paid off.

 

[meinjo]

we agreed on 15k. He owes 14k, so he has 1k equity. Should I make a check to his bank for 14k, and a check to him for 1k? I assume his bank will send him the title and then he just signs it over to me, right? In the mean time, until the title gets here, I can use the bill of sale to get it registered.
Is it this simple, or does his backruptcy get in the way?

THanks!
D

 

[djohnson]

When did he file the chapter 13? If he is still in the 13 and making payments to the trustee and this boat is included he may have to petition the court to approve sale, and they may possibly want the excess funds for unsecured creditors. He needs to check with his attorney. If he is already out, it's different.

 

[BelizeBreeze]

And why did you feel it necessary to post this AFTER you were given advice?