Went to have a look at a car yesterday and after agreeing a price, the owner stated that the vehicle had outstanding finance on it. He suggested that on the day of the transaction, we both go to the bank of my choice and I settle his debt with the finance company (for which he has a written settlement figure) and then pay him the outstanding balance.

The guy seems genuine and trustworthy. It seems sensible enough to me and ensures his debt with the finance company is cleared before I take the vehicle but are there any pitfalls? Anyone done this type of thing before?

Phil

Only if you can 100% guarantee that by making the payment to them, you will have clear title to the goods.
I would be looking to pay them directly TBH.

I am looking to pay them directly via bank transfer on the day of the transaction.

I've done it twice but through a dealer and paid the finance company myself over the phone. HPI showed up the finance and who with both times (although the information was also volunteered by the dealer before I checked with HPI).

I'd be more careful with a private sale but HPI should be able to tell you who the finance is with and a contact number for them and then you can phone with the contract number and pay it off.

The seller showed me a letter from the finance company with all the details on it and the settlement figure. He will accompany me to the bank on the day of the transaction, where I will transfer the money direct from my account to the finance company (for the settlement figure) and release the balance to him.

It seems a simple enough process to me although I would prefer written confirmation from the finance company that the debt has been settled, although I doubt they'd be able to do that at the time of transaction?

I know there's always some wariness about this sort of thing, but from the other side of the deal, I've sold two cars and cleared the finance as part of the sale.

Not everyone is pulling a scam.

If I suspected a scam, I wouldn't be considering this. I am however being cautious and having never done this kind of thing before, want to make sure that everything goes smoothly on the day. Ideally, I'd like to contact his finance company but I suspect they would be unwilling to give me any information.

sounds genuine to me. i've done it before and it was fine.

If he requests a settlement figure from the finance company, they should send a written statement, which might give you a bit more confidence.

The last car I bought had finance on it, the guy settled there and then on the phone and emailed me the confirmation whilst i was driving home.

There is nothing really to worry about if you keep a paper trail.

don't see a problem with this as long as the finance company gets their money they will be happy.

Make sure that the Adresses on everything match up and you should be fine, as long as you've got a paper trail you should be alright as you can catch someone out if it goes tits up.