Liability

[tailwheel]

I may be buying a fairly new (2003) used compact tractor. I was wondering if it is possible if there could be any lein type concerns if the tractor is currently financed? If the tractor is used as collateral for a loan should I have any concerns with the purchace? I am also wondering about insurance. Should I by (and is it avialable) insurance for a compact tractor or is it covered by my home owner's policy?
Thanks in advance for your replys.
Dave

 

[sweettractors]

If there is a lein, I should be on record in the county courthouse--Ken Sweet

 

[jwnge]

My insurance, American Family , covers my tractor on my property under homeowners policy, If it is taken onto public roads, you need a rider or different policy to cover it..

 

[RonR]

I believe that most of the time if you are using the tractor on your own property, your homeowners will cover liability, but you should check with your agent BEFORE something bad happens.

If you take it off your property especially for hire, your homeowner insurance agent will not speak to you, let alone think of covering you.

Check with your agent............

Ron

 

[LBrown59]

</font><font color="blue" class="small">( I may be buying a fairly new (2003) used compact tractor. I was wondering if it is possible if there could be any lein type concerns if the tractor is currently financed? If the tractor is used as collateral for a loan should I have any concerns with the purchace? I am also wondering about insurance. Should I by (and is it avialable) insurance for a compact tractor or is it covered by my home owner's policy?
Thanks in advance for your replys.

There is a lot of post on the board about insurance .DO a Search!
Dave )</font>

 

[johnsonauto]

There should be a UCC lein filed in the county or with the seceratary of state in which the tractor was purchased. Insurace in some parts of the country is pretty standard on your home owners, and in my area it varies with insurance company, it seems 50/50 in the NorthEast.

 

[2nstonge]

In my neck of the woods tractors aren't titled like a vehicle or trailer, so, in theory, I could sell mine at any time and as long as I continued to make the payments JD wouldn't know I no longer owned it since no title changes hands. If I ever defaulted on the note I have no idea what their recourse is - other than suing me. I would ask the current owner to connect you with the company who financed the tractor for him. They should tell you what needs to happen to make them happy as part of the sale. If he doesn't want to cooperate it may give you reason to pause on the transaction.

As far as insurance, as others have said your homeowners should cover it if it's for personal use on your own property. Depending on its value they may charge a few $$/year on your policy. If you're going to hire yourself out there's a whole other level of insurance - do a search n this site, you'll find lots of good discussion. In any case, if you're buying private party you may want to have a dealer look it over and give you a written appraisal of its value. Also, make a folder with photos & serial numbers of the tractor & all attachments and give a copy to your insurance company, it'll make life much easier if you should ever have to file a claim.

-Norm

 

[KiotiJohn]

</font><font color="blue" class="small">( If I ever defaulted on the note I have no idea what their recourse is - other than suing me. )</font>
In some jurisdictions, selling property under lean is considered fraud, and is punishible by fine, imprinsonment or both. It's not the same as defaulting on a credit card. John

 

[jfdlaw]

Check for liens both at the county level, clerk or courthouse depending on your state's system, and at the state level, usually the secretary of state. Check both, the lien can be filed in either place and it only has to be filed once.

Even though there is no certificate of title (like a car) the lien is usually filed. It is just as effective as if it was printed on a certificate of title. If the seller does not pay back the loan, the finance company can come get the tractor even if you didn't know about the lien. There is a thread about a friend of mine that got burned. Search for "liens" it was started about a year and a half ago.

Also check with the dealer who sold it. They may tell you. Due to the new financial privacy laws, they also may not.

I cover my tractor under my homeowner's policy.

 

[tailwheel]

Thanks everyone for your insight. I plan on using the tractor on my own property for personal use so I will call my agent for my homeowners policy and let him know about the tractor. To check on leins I will check with the county, state, and dealer. I don't expect a problem but I have been burned before and just wanted to do my home work before I spend money.
Thanks again.
Dave

 

[KiotiJohn]

</font><font color="blue" class="small">( I don't expect a problem but I have been burned before and just wanted to do my home work before I spend money.
Thanks again. Dave )</font>
We had a poster that posted about someone who bought a tractor only to find out the seller didn't pay it off.
I'll let you read about it. I finally found the post after 30 minutes of looking!
Buying used check for lein
John

 

[Darren]

The other issue with used tractors concerns whether or not they were stolen. Most of us don't think to run the serial number through local law enforcement to see if it shows up in the national database.

 

[jfdlaw]

I was the one started the thread ("buying used check for liens") posted by KiotiJohn. My friend had the problem with the deadbeat and John Deere. The final resolution was that he had to pony up another $10K to buy off Deere. His "deal of the century" turned out to be too good to be true. The total he paid (between the deadbeat and Deere) is more than he would have paid to buy the tractor new.

I had another friend who bought a used outboard engine. Checked the serial number with the police and the manufacturer and everything was fine. Nine months later the police were on his doorstep. Turns out the engine was stolen afterall.

The dealer who originally sold it had two of the same model, and wrote the wrong number on the original customer's invoice. When the customer's engine was stolen, the customer called in the serial number on his invoice, which was not the number on engine that was stolen. A year later the manufacturer figured it out when there was a warranty claim on the other engine. Who lost? My friend with the stolen engine. Even though he checked with the police and the manufacturer, he did not have good title to the engine. The police seized the engine as evidence. After the trial my friend was able to buy the engine back from the original customer's insurance company. Cost him another $2K.

There is risk in buying used. That's part of the reason you should be able to buy cheaper than new. Understand all the risk before you decide to go that route.

 

[tailwheel]

John, thanks for posting the link. I spoke with the dealer today and they verified that there is a loan secured by the serial numbered tractor I wish to buy. (the seller did also disclose that he has a loan on the tractor). The dealer was not able to say what the outstanding debt is. The dealer's first reaction was that since we were not doing the sale through him he did not have an interest. I then asked him who the lender would call on to do the repossession if the loan went into default and he said it would be them. I then informed him that I would prefer to meet him buying implements and parts from his dealership then him showing up at my house to take my tractor. He took my number and called me back within 5 minutes and suggested that when I make the purchase I write two checks, one to the finance company and the other for the remainder to the seller. This is more that I expected to do to buy a used machine but it is worth it if this what it takes to have a piece of mind.

I am now wondering if any one has a blank bill of sale that will work well for this purchase?

I also spoke with my insurance agent and found that I am covered on my own property for non commercial business.

Dave

 

[AndyMA]

</font><font color="blue" class="small">( I make the purchase I write two checks, one to the finance company and the other for the remainder to the seller. This is more that I expected to do to buy a used machine but it is worth it if this what it takes to have a piece of mind.

)</font>

This is common practice when I've either bought or sold items with a lien. Gets clear title quickly and surely.

Andy

 

[jfdlaw]

I would require the seller to get a written pay off statement from the lender. That way you have the exact amount and the address where to send payment. Remember that the seller owes the principal balance plus interest from his last payment plus any late fees. Just getting the principal balance may not satisfy the loan.