[husan786]

My friend had recently lease a 435i.. a few months after he received a title on his name with no liens whatsoever. I have never heard of this before. Knowing the car is a lease which means it is borrowed by Bmw, however the owner is Bmw regardless. Any one of any insights on this?

[CalCarNut]

sounds like someone is gonna get fired........... lol

Morals check time. Call BMW and tell them he received the title in his name mistakenly....

[tturedraider]

Originally Posted by CalCarNut

sounds like someone is gonna get fired........... lol

Morals check time. Call BMW and tell them he received the title in his name mistakenly....

Yeppers. Someone screwed up.

[graphite]

He'll need to call BMW or go to the dealer and inform them. Definite oops on someone's part, but it's not like we're dealing with a mom & pop lot. BMW would be on his ass like white on rice if he tried any funny business at end of lease.

[kadify]

Originally Posted by graphite

He'll need to call BMW or go to the dealer and inform them. Definite oops on someone's part, but it's not like we're dealing with a mom & pop lot. BMW would be on his ass like white on rice if he tried any funny business at end of lease.

True but legally he owns the car if he has the title of the car so....

[CalCarNut]

Originally Posted by kadify

True but legally he owns the car if he has the title of the car so....

'Legally' through a mistake. I certainly wouldn't want BMW after me; BMW: Prove to us/courts that you paid for the car in full". You: "Uhhhhhhh"

Nope, not me. You'd never be able to purchase a new one..ever...and you'd have a huge corporation on your tail..all over a $50K car that in 3yrs is worth half that? Not worth it.

[2000Z3M]

Originally Posted by kadify

True but legally he owns the car if he has the title of the car so....

im sure there is something in the contract that will cover this

[CalCarNut]

Originally Posted by 2000Z3M

im sure there is something in the contract that will cover this

I'm sure with all the Lessees we have here..one could pull their contract and see what it says

Mine is a purchase...otherwise I would.

[Billfitz]

Originally Posted by tturedraider

Yeppers. Someone screwed up.

+1. The registration should be in his name, but the title should have been issued to the lessor, ie., the finance company that holds the lease.

[tex2670]

Originally Posted by husan786

My friend had recently lease a 435i.. a few months after he received a title on his name with no liens whatsoever. I have never heard of this before. Knowing the car is a lease which means it is borrowed by Bmw, however the owner is Bmw regardless. Any one of any insights on this?

Someone screwed up big time.

[tex2670]

Originally Posted by kadify

True but legally he owns the car if he has the title of the car so....

He signed a lease agreement--the fact that a mistake was made and put his name on title doesn't mean the contract he signed isn't valid anymore.

[kadify]

Of course thats true. I was just joking. Even if he wanted to try and get away with this BMW would never allow it, this is a big issue though because legally (as in in the eyes of the court) he is the owner of the car regardless of what he did or did not pay so until this issue is fixed, technically the car can't be repossessed, that's all.

[tex2670]

Originally Posted by kadify

Of course thats true. I was just joking. Even if he wanted to try and get away with this BMW would never allow it, this is a big issue though because legally (as in in the eyes of the court) he is the owner of the car regardless of what he did or did not pay so until this issue is fixed, technically the car can't be repossessed, that's all.

When I finance, legally, I own my car; my name's on the title. So if I don't pay my loan, the bank can't repossess it? Of course not. There's more to the analysis than who's name is on the title document.

[Billfitz]

Originally Posted by tex2670

When I finance, legally, I own my car; my name's on the title. So if I don't pay my loan, the bank can't repossess it?

Not if someone screws up and doesn't name them as a lien holder. They'd have to go to court to prove their claim. Same thing here, since this guy has a clear title technically he could sell the car, keep the proceeds, and the lessors only recourse would be to sue him for the balance due, or to get it from the creator of the screw up, the dealer, and then it's the dealer's problem. That would be the most likely course, as the dealer agreement obligates them to properly title the vehicle. Failure to do so renders their contract with the lessor null and void and they're on the hook for it.

[tex2670]

Originally Posted by Billfitz

Not if someone screws up and doesn't name them as a lien holder. They'd have to go to court to prove their claim. Same thing here, since this guy has a clear title technically he could sell the car, keep the proceeds, and the lessors only recourse would be to sue him for the balance due, or to get it from the creator of the screw up, the dealer, and then it's the dealer's problem. That would be the most likely course, as the dealer agreement obligates them to properly title the vehicle. Failure to do so renders their contract with the lessor null and void and they're on the hook for it.

The ability to sell the car out from under the lien holder, free and clear of the debt is not the same as the lien holder being unable to repossess the car.

[kadify]

Originally Posted by tex2670

When I finance, legally, I own my car; my name's on the title. So if I don't pay my loan, the bank can't repossess it? Of course not. There's more to the analysis than who's name is on the title document.

I think you're talking about something completely different. If you finance a car through the dealer and use whichever bank the dealer prefers, the bank usually holds the title until you pay the car off. If you get a loan from your own bank to pay 'cash' to the dealer for your car then yes you would have the title but that doesn't mean didly to the bank who's money you're borrowing. If you miss a payment the bank isn't going to try to repossess the car (I don't think) they'll just place liens on anything and everything you own so you are forced to pay them back, or file bankruptcy, whichever comes first.

[tex2670]

Originally Posted by kadify

I think you're talking about something completely different. If you finance a car through the dealer and use whichever bank the dealer prefers, the bank usually holds the title until you pay the car off. If you get a loan from your own bank to pay 'cash' to the dealer for your car then yes you would have the title but that doesn't mean didly to the bank who's money you're borrowing. If you miss a payment the bank isn't going to try to repossess the car (I don't think) they'll just place liens on anything and everything you own so you are forced to pay them back, or file bankruptcy, whichever comes first.

We are talking about who's name is on the title.

If you finance your car, your name is on title, and the bank holds the document as a measure to keep you from selling the car. If you pay cash, you get the title paperwork. The right to repossess the car is not about who's name is on the title paperwork; it's about the rights the bank or finance company is given in the loan or lease papers. If you get an auto loan, the loan papers are going to give the bank the right to repossess the car--it has absolutely nothing to do with whether you financed at the dealer or your own bank, or some internet website.

[kadify]

Originally Posted by tex2670

We are talking about who's name is on the title.

If you finance your car, your name is on title, and the bank holds the document as a measure to keep you from selling the car. If you pay cash, you get the title paperwork. The right to repossess the car is not about who's name is on the title paperwork; it's about the rights the bank or finance company is given in the loan or lease papers.

Ah yes you're correct I was mistaken in thinking a new title was drafted when the last payment was made.

I suppose in this case it depends on whether this is the original title or just a copy. A copy doesn't mean a whole lot but if it is the original copy, perhaps it was mailed wrongly to the lessee instead of the bank, then that is a very big mistake on the dealership's part.

[Billfitz]

Originally Posted by tex2670

The ability to sell the car out from under the lien holder, free and clear of the debt is not the same as the lien holder being unable to repossess the car.

The lien holder only has the legal right to repossess the car if they have a valid lien. If it's not listed on the title or otherwise registered with the state they don't have a valid lien. Before they could legally repossess they'd have to get a court order based on the contract document. This was one of the legal niceties that I had to be sure of before I issued a repossession order during my tenure at Ford Motor Credit.

[mmmmm235i]

This is in no way intended to be legal advice. When it comes to car title the only thing that truly matters is whether the lien holder (the dealer) is noted on the title. I would find it very hard to believe that BMW was somehow left off the title. While it seems a mistake was made, the fact that the lease holder possesses the physical title does not affect the dealers interest. The only thing this mistake would affect is whether a subsequent buyer who purchases from the lease holder acting wrongfully as the owner could maintain possession once the mistake is discovered by the dealer.

[tex2670]

Originally Posted by Billfitz

The lien holder only has the legal right to repossess the car if they have a valid lien. If it's not listed on the title or otherwise registered with the state they don't have a valid lien. Before they could legally repossess they'd have to get a court order based on the contract document. This was one of the legal niceties that I had to be sure of before I issued a repossession order during my tenure at Ford Motor Credit.

Correct--the lender still has rights under the loan or lease documents. But without physically having the title document, they need a court to confirm that they have a valid lien that would allow them to repossess the collateral.

[Billfitz]

Originally Posted by mmmmm235i

When it comes to car title the only thing that truly matters is whether the lien holder (the dealer) is noted on the title.

A lien only applies to a purchase. The dealer would not be the lien holder, unless the dealer financed the purchase, rather than a bank or other financing source. With a lease the financing institution is the legal owner of the car, and the title should be in that institutions name. There would be no lien holder.
In either case when the dealer sends the purchase or lease documents to the financing institution they must provide copies of the title application, showing the financial institution as lien holder on a purchase or owner on a lease, otherwise the contract wouldn't take effect and the dealer wouldn't get paid for the car. When I was with Ford Credit on occasion a dealer would mess up, but they'd fix it really quick once I told them that they weren't getting paid for the car.
Occasionally we missed an AFU title app, which came to light if the purchaser defaulted. Normally a dealer has little to no liability if a borrower defaults, but in these cases we had to right to have the dealer pay the contract in full. I never had to do that, because once informed of his liability the dealer always managed to locate the customer and 'convince' him of the error of his ways. This was the NYC branch of Ford Credit, and any dealers who weren't 'connected' had friends who were.