Inspector507
Super Member
The only security interest they have is on that tractor. To repo something else would take a suit and judgement in court.
Buying used? Check for liens
- Thread starter jfdlaw
- Start date
- Views: 35804
755inNY
Platinum Member
- Joined
- Jul 4, 2003
- Messages
- 530
- Tractor
- JD 4310, ehydro, 4WD, R4s
<font color="blue"> Repo his car/truck or house to recover the money. </font>
Certainly it is not fair, but it is legally right. Deere is going after the property that secured the loan not the guy who bought the tractor from the original owner. Deere has no legal right to go after the original owner by repo'ing his car/truck or house. Deere is not at fault here. Unfortunately there is a lot of fraud out there and trusting people are going to get burned.
Jeff
Certainly it is not fair, but it is legally right. Deere is going after the property that secured the loan not the guy who bought the tractor from the original owner. Deere has no legal right to go after the original owner by repo'ing his car/truck or house. Deere is not at fault here. Unfortunately there is a lot of fraud out there and trusting people are going to get burned.
Jeff
stuart
Gold Member
Once Again: If the buyer purchased it from the person who owed money to Deere had no idea there was any lein on the tractor and he gave fair (full) value for the tractor he may be able to keep it over the claim of John Deere Credit. He is called a BFP: a Bona Fide Purchaser for Value. He needs to contact an attorney in his area and not just turn it over to the JD credit people.
BillyP
Veteran Member
I don't know how the laws read where this happened but in Oklahoma, it's against the law to sell something with a lien against it. That is of course the original owner pays it off or the finance company releases the lien.
When I bought my poultry operation, the seller didn't tell me he still owed for the watering system. About a year later I received a telephone call wanting to know how to get a hold of the previous owner. I gave them his new telephone number and never heard another word from them. I did see the owner and asked him if he had paid them and he said no and wasn't going to. About 6 months later I saw he ex-wife and asked her about it. She said he had paid it off.
I did check at the county court house for a UCC filing on this and sure enough there was. Of course this was after I found out he still owed for it.
When I bought my poultry operation, the seller didn't tell me he still owed for the watering system. About a year later I received a telephone call wanting to know how to get a hold of the previous owner. I gave them his new telephone number and never heard another word from them. I did see the owner and asked him if he had paid them and he said no and wasn't going to. About 6 months later I saw he ex-wife and asked her about it. She said he had paid it off.
I did check at the county court house for a UCC filing on this and sure enough there was. Of course this was after I found out he still owed for it.
Alan L.
Elite Member
This is a real problem because tractors don't have titles. When a title is involved I believe the lendor can only perfect his security interest by keeping the title. Otherwise he files the financing statement with the UCC.
The problem is, you can't always find the financing statement for the tractor, because it could exist under names other than the one provided by the seller. Especially if the seller is a crook anyway.
In this case it would appear the buyer is screwed and will have to go back to the seller to get his money.
The problem is, you can't always find the financing statement for the tractor, because it could exist under names other than the one provided by the seller. Especially if the seller is a crook anyway.
In this case it would appear the buyer is screwed and will have to go back to the seller to get his money.
Bird
Rest in Peace
</font><font color="blue" class="small">( it's against the law to sell something with a lien against it )</font>
It sure is, but apparently is a lot more common that most folks realize. When we bought our first house in 1968, it was supposedly 18 years old and there was a gas grill (natural gas) mounted in the ground at the edge of the patio. A couple of months later, I heard from the gas company wanting to be paid for it. Apparently a prior owner had it installed by the gas company, never paid for it, then sold the house to a real estate speculator/realtor who sold it to us. I had no trouble with the gas company. They simply said the guy who owed them wouldn't be able to get gas service in Texas again until he paid for it. /forums/images/graemlins/smile.gif
And when we bought the little farm with the 40' x 60' shop building, the title search revealed a lien because that building had not been paid for. And of course I wouldn't buy the place until that lien was cleared up. Really weird deal, and I don't know whether real estate laws are the same in other states or not, but. . . .. The guy I bought the place from had sold it once before and financed it himself. The buyer had the shop built and financed that elsewhere. Then the buyer committed suicide before he paid for anything. The seller of the property initiated foreclosure proceedings and the entire property was sold at auction on the courthouse steps, with the seller being the only bidder. The company that financed the building was the loser because they could have been there and bid, but did not, therefore they lost their rights.
It sure is, but apparently is a lot more common that most folks realize. When we bought our first house in 1968, it was supposedly 18 years old and there was a gas grill (natural gas) mounted in the ground at the edge of the patio. A couple of months later, I heard from the gas company wanting to be paid for it. Apparently a prior owner had it installed by the gas company, never paid for it, then sold the house to a real estate speculator/realtor who sold it to us. I had no trouble with the gas company. They simply said the guy who owed them wouldn't be able to get gas service in Texas again until he paid for it. /forums/images/graemlins/smile.gif
And when we bought the little farm with the 40' x 60' shop building, the title search revealed a lien because that building had not been paid for. And of course I wouldn't buy the place until that lien was cleared up. Really weird deal, and I don't know whether real estate laws are the same in other states or not, but. . . .. The guy I bought the place from had sold it once before and financed it himself. The buyer had the shop built and financed that elsewhere. Then the buyer committed suicide before he paid for anything. The seller of the property initiated foreclosure proceedings and the entire property was sold at auction on the courthouse steps, with the seller being the only bidder. The company that financed the building was the loser because they could have been there and bid, but did not, therefore they lost their rights.
BillyP
Veteran Member
</font><font color="blue" class="small">( It sure is, but apparently is a lot more common that most folks realize )</font>
Yeah Bird, it is. A lot of times, in Oklahoma anyway, you don't know some things until you get ready to sell a piece of property.
Example... I hire a contractor to build me a barn. He opens up an account as "The BillyP Barn" at the local lumber yard, so he can track expenses. He gets through and I pay him but he doesn't pay the lumber yard. The lumber yard can file a lien on my property for money owed on my 'supposed' account. I wouldn't know the lien had been filed unless I sell the property or refinanced (anything that involved a title search).
Some laws are just plain stupid.
Yeah Bird, it is. A lot of times, in Oklahoma anyway, you don't know some things until you get ready to sell a piece of property.
Example... I hire a contractor to build me a barn. He opens up an account as "The BillyP Barn" at the local lumber yard, so he can track expenses. He gets through and I pay him but he doesn't pay the lumber yard. The lumber yard can file a lien on my property for money owed on my 'supposed' account. I wouldn't know the lien had been filed unless I sell the property or refinanced (anything that involved a title search).
Some laws are just plain stupid.
Billy, I think what you're talking about is a Mechanic's lien. In Ohio, to properly perfect the lien, certified mail service/notice of the lien must be sent to the owner, who then can give the lienholder a notice to commence suit. This notice forces the lienholder to act right away or lose their lien rights.
Soundguy
Old Timer
- Joined
- Mar 11, 2002
- Messages
- 52,424
- Location
- Central florida
- Tractor
- RK 55HC,ym1700, NH7610S, Ford 8N, 2N, NAA, 660, 850 x2, 541, 950, 941D, 951, 2000, 3000, 4000, 4600, 5000, 740, IH 'C' 'H', CUB, John Deere 'B', allis 'G', case VAC
That certified stuff would be a 'Notice to owner'.. I have to fill them out every now and then for the contractor I work for.
The best way to get around these problems.. is to always have the contractor provide ' release or waiver of lein' from his subs and material suppliers, -before- paying him.
When I built my house about 4 years ago.. the bank wouldn't issue a draft/draw to the contractor without him providing WOL from each sub or material supplier that had work or materials involved with the invoice being paid. Protected everybodies interest.
Soundguy
The best way to get around these problems.. is to always have the contractor provide ' release or waiver of lein' from his subs and material suppliers, -before- paying him.
When I built my house about 4 years ago.. the bank wouldn't issue a draft/draw to the contractor without him providing WOL from each sub or material supplier that had work or materials involved with the invoice being paid. Protected everybodies interest.
Soundguy
BillyP
Veteran Member
I did pretty close to that when I had my barn built. I set up an account at the lumber yard (limited to x amount), When the job was done, I paid him the difference between bid price minus material cost.
ipwanab
Bronze Member
Your post gave me chills. I just went through a lien matter on property.I am getting ready to build and my bank did title work before giving me a bridge loan. (This after I argued over the cost of the insurance for the land), anyway the insurer had to rectify the problems before proceeding. In the meantime ( I had no idea how long this would take)I went to my county recorder and asked the person if I could lok at liens.She showed me how and I looked at myself first .Wow every loan I ever had was there ! I was amazed. I then looked up my property in question and the names associated with it and I kind of understood everything but a UCC from Deere for the guy filing the lien. It's amazing the things I have learned here.
Sorry I haven't posted anything new on this. I've been working 12-14 hour days and haven't had a chance to spend much time on the computer.
The situation is still up in the air. I think they will probably work out some settlement, but it will cost my friend money. His great deal isn't great anymore. Instead he will probably end up paying (between what he paid the seller and what he's going to pay deere) more than a new tractor would have cost new.
Another thing that came up is that the seller lied about his address. Again this was all done over the phone, and he had his money wired to his bank. The address he provided was across the county line, so that if a title search had been performed, the lien would not have appeared. Deere provided a copy of the filed UCC statement, and it was filed in the adjacent county. I don't believe they filed it with the state.
Before I mentioned you needed to search for liens (both county and state) and run the serial number past a dealer to make sure their system does not show it was stolen. I think you also need to see if the dealer can tell you the address the original owner gave the finance company so that you make sure you search the right county.
As to "bona fide purchaser" rules, that requires that you be a bona fide purchaser without knowledge of the lien. The whole reason people file liens, deeds, mortgages, etc. with the county or state is that this is constructive knowledge. i.e. everyone is deemed to know about the filed records. The burden is place on the individual to perform a diligent search of these public records. The practical problem is where and how to do this search.
I'll let you know more as it unfolds.
Again, if it sounds to good to be true, it probably is.
The situation is still up in the air. I think they will probably work out some settlement, but it will cost my friend money. His great deal isn't great anymore. Instead he will probably end up paying (between what he paid the seller and what he's going to pay deere) more than a new tractor would have cost new.
Another thing that came up is that the seller lied about his address. Again this was all done over the phone, and he had his money wired to his bank. The address he provided was across the county line, so that if a title search had been performed, the lien would not have appeared. Deere provided a copy of the filed UCC statement, and it was filed in the adjacent county. I don't believe they filed it with the state.
Before I mentioned you needed to search for liens (both county and state) and run the serial number past a dealer to make sure their system does not show it was stolen. I think you also need to see if the dealer can tell you the address the original owner gave the finance company so that you make sure you search the right county.
As to "bona fide purchaser" rules, that requires that you be a bona fide purchaser without knowledge of the lien. The whole reason people file liens, deeds, mortgages, etc. with the county or state is that this is constructive knowledge. i.e. everyone is deemed to know about the filed records. The burden is place on the individual to perform a diligent search of these public records. The practical problem is where and how to do this search.
I'll let you know more as it unfolds.
Again, if it sounds to good to be true, it probably is.
BIGUN
Gold Member
I guess if he had never taken it in to a Deere dealer they would still be looking for it. Stories like this make you want to only buy new. /forums/images/graemlins/crazy.gif
MDNY
Platinum Member
I guess it now becomes a fraud case and even more expense to sue to get his money back. This just stinks. /forums/images/graemlins/mad.gif
MDMY - You got it. If Deere can't get their money out of the guy, and they have a collection department and in house attorneys, what chance does my friend have? As someone before mentioned, the suit would have to be brought where the seller lives, so he would have to find an attorney down there (in another state) to bring the action. At what point is it throwing good money after bad?
It seems that the moral of this story is bad news for tractor buyers.
Never buy used tractor equipment, ESPECIALLY JD.
I think JD should reconsider the message they are sending here. JD made the deal with the first owner. JD made the sale. JD took the risk, and believe me, the risk for JD is well defined, and the numbers well calculated. For JD, the occasional ne'er-do-well is a part of the equation.
Visiting the sins of the few on to a potential good customer for life is simply bad business.
I have already had some bad experiences with JD equipment. Reading this thread has ensured that I will never make a major JD purchase.
In the days when information and events that affected only a few was hard to come by, mostly passed about by word of mouth and rumor, a company might get away with this. With the advent of the internet, no company is afforded that luxury any more.
I understand that JD wants it's money. If they want to do the right thing, then go get the guy that stiffed them. Maybe JD should be an industry leader and work with legislation on some form of title protection. What they need to do RIGHT NOW, is leave the innocent guy alone.
David
Never buy used tractor equipment, ESPECIALLY JD.
I think JD should reconsider the message they are sending here. JD made the deal with the first owner. JD made the sale. JD took the risk, and believe me, the risk for JD is well defined, and the numbers well calculated. For JD, the occasional ne'er-do-well is a part of the equation.
Visiting the sins of the few on to a potential good customer for life is simply bad business.
I have already had some bad experiences with JD equipment. Reading this thread has ensured that I will never make a major JD purchase.
In the days when information and events that affected only a few was hard to come by, mostly passed about by word of mouth and rumor, a company might get away with this. With the advent of the internet, no company is afforded that luxury any more.
I understand that JD wants it's money. If they want to do the right thing, then go get the guy that stiffed them. Maybe JD should be an industry leader and work with legislation on some form of title protection. What they need to do RIGHT NOW, is leave the innocent guy alone.
David
fishman
Veteran Member
Well said Tornado.
BillyP
Veteran Member
Actually Tornado, the tractor 'belongs' to JD until it's paid for. Now if the original owner had went to a bank and borrowed the money for the tractor and sold it, what do you think would happen? The bank would be looking for their tractor and the guy would have his butt in jail.
I would like to buy a tractor from you. On credit, of course /forums/images/graemlins/wink.gif
I would like to buy a tractor from you. On credit, of course /forums/images/graemlins/wink.gif
755inNY
Platinum Member
- Joined
- Jul 4, 2003
- Messages
- 530
- Tractor
- JD 4310, ehydro, 4WD, R4s
<font color="blue"> Never buy used tractor equipment, ESPECIALLY JD.
</font>
<font color="blue"> I have already had some bad experiences with JD equipment. Reading this thread has ensured that I will never make a major JD purchase.
</font>
Do you really think that JD is the only tractor manufacturer that would pursue this course of action? Get real.
Jeff
</font>
<font color="blue"> I have already had some bad experiences with JD equipment. Reading this thread has ensured that I will never make a major JD purchase.
</font>
Do you really think that JD is the only tractor manufacturer that would pursue this course of action? Get real.
Jeff
Maybe you missed my point.
The innocent guy is caught in a game between JD and the guilty. Ultimately, it is JD's fault for offering the loser credit. They could have simply sold the tractor for cash.
JD is using the financing option as marketing. As such, there are certain risks. JD is assuming these risks. JD financed a tractor for a loser/petty criminal. The poor slob that bought the tractor is a victim of JD's marketing and the crooks' greed.
Leave the innocent guy out of the deal. JD needs to pursue the crook.
My $0.02 worth.
David
The innocent guy is caught in a game between JD and the guilty. Ultimately, it is JD's fault for offering the loser credit. They could have simply sold the tractor for cash.
JD is using the financing option as marketing. As such, there are certain risks. JD is assuming these risks. JD financed a tractor for a loser/petty criminal. The poor slob that bought the tractor is a victim of JD's marketing and the crooks' greed.
Leave the innocent guy out of the deal. JD needs to pursue the crook.
My $0.02 worth.
David
