OMG! I wish this process was easier. Finally I was approved for a loan and found the car that I really want.
Found out that the car has a lien on it worth $14000. Purchase price is $36000.
Saw the title and the title has sellers name on it and his CU is listed as a lien holder. What should I do in this circumstances? I talked to my CU, they said they will send me a check and I can give it to the seller and they can get the lien released and transfer the title onto my name.
I don't want to risk it though. What if I give him the check and he refuses to release the lien?
So I told him that when I come there with a check from my CU, we can go to his bank and he can pay his loan off (with his money) and get the lien released and sign it over to me and that's when I will handover him my check.
Is there any other way that this can be done? Is it a long procedure for getting a lien release? or do the banks do it as soon as we pay them? Do we have to go through DMV to get a new title and stuff?
Sorry for being a noob, my first car purchase 
*UPDATE*
The seller said he will pay off the loan tomorrow and get the lien released with his money. How do I make sure that the lien has been released?
@Anonymous wrote:OMG! I wish this process was easier. Finally I was approved for a loan and found the car that I really want.
Found out that the car has a lien on it worth $14000. Purchase price is $36000.
Saw the title and the title has sellers name on it and his CU is listed as a lien holder. What should I do in this circumstances? I talked to my CU, they said they will send me a check and I can give it to the seller and they can get the lien released and transfer the title onto my name.
I don't want to risk it though. What if I give him the check and he refuses to release the lien?
So I told him that when I come there with a check from my CU, we can go to his bank and he can pay his loan off (with his money) and get the lien released and sign it over to me and that's when I will handover him my check.
Is there any other way that this can be done? Is it a long procedure for getting a lien release? or do the banks do it as soon as we pay them? Do we have to go through DMV to get a new title and stuff?
Sorry for being a noob, my first car purchase
*UPDATE*
The seller said he will pay off the loan tomorrow and get the lien released with his money. How do I make sure that the lien has been released?
Once the seller hauls down to the CU and satisfactorily pays off the loan with a loan officer, the officer will sign a "lien release," saying that their interest in the vehicle has been satisfied. It must be signed by the loan officer and in original ink, blue is best and the seller will then attach the signed lien release to the original title that shows the lien. THIS RELEASE MUST BE SIGNED IN ORIGINAL INK, DMV WILL NOT ACCEPT COPIES OF LIEN RELEASES EVER EVER EVER to transfer ownership and registration to you. So, if the seller makes a copy of the release and tries to attach that to the title, it's a hard "no," you need the original. Multiple releases can be signed by the CU to ensure all parties involved have a viable copy.
Since this is your first purchase, be sure to check that the seller has endorsed the back of the title with their current address and signature in the appropriate area, validating the transfer of ownership. Also, and with private sales of this type this often does not happen, obtain a "bill of sale/receipt" for the purchase. DMV will ensure interest is charged and paid by you upon registering the vehicle/title/purchase in their system...so be prepared to pay that on top of registration fees as well. DMV will not register/transfer the vehicle to you unless you have some sort of receipt for the car purchase that is signed by the seller. The receipt can be something as simple as a lined piece of paper stating the purchase price and signed by the seller, or something more in depth, many templates can be found for free online and printed and the purchase info filled in by the parties. I would suggest printing a simple one out and come armed with that to avoid any hiccups during the transaction.
Edit: Post was duplicated...
@Anonymous wrote:He sent me a letter today from his bank saying that "The bank no longer holds a secured interest in the vehicle"
Is there anything else that I need to confirm?
In addition to the lien release letter, you'll need the "pink slip" or registration signed over to you as buyer by the seller. Together, those documents should allow you to go to your local DMV and register the vehicle in your name.
Of course, your lender will file a lien of their own against the vehicle. Check with them regarding the procedure for that as each state is different.
