How to check a car for credit or collateral?

Buying a car is a responsible task. This is due not only to the lengthy paperwork but also to the need for thorough technical and legal checks of the car. The presence of malfunctions in the purchased car is just the tip of the iceberg compared to the problems that will arise if you find out that the car is a pledged item. This will lead to the buyer losing money and the car. In our review, we will tell you how to check a car on credit.

Before issuing a car loan, the lender requires guarantees of repayment of the borrowed funds with interest. The newly purchased car is used as collateral for the loan agreement. The person who issued the loan keeps the vehicle passport. This document is returned to the borrower only after repaying a certain part of the debt. 

But sometimes, dealers devise methods to sell a car that is pledged. In this case, all loan obligations are assigned to the car's new owner. These practices are quite common in Ukraine. That's why you must know how to check a car as collateral.

It is easy to check a car for a pledge or loan. To do this, you need to 

• use the VIN code. Any car has a specific identification number. It can be found in technical documents or on the car body; 
• check it through official databases. There are several services in Ukraine through which you can get information about a car on credit;
• contacting a bank or any other financial institution. If the potential buyer has information about the bank where the car loan was taken out, you can contact the company's managers directly;
• consultation with a lawyer. It is better to contact professionals specializing in automotive transactions if in doubt. They will tell you what to do in this case. 

You need to notify the seller before the inspection so that it is open. You also need to understand that all this may entail additional costs. But it's better to spend money from the beginning than to get a car with a credit encumbrance later.

Checking a car for a loan online uses a 17-digit VIN code. You need to enter this number in the line of the corresponding service to get information about the car. So, you can check a car on credit online through the CarFaxDoc platform. You can also contact government services to obtain relevant information. Usually, the database includes: 

• the date of the car loan; 
• debt repayment terms; 
• creditor's data; 
• date of registration of the collateral. 

However, to avoid getting a car on credit, it is advisable to buy it from trusted sellers.

If you buy a car on credit, you need to understand that you won't be able to donate or resell the car. There are only two options: 

• find and negotiate with the seller. But this is a very complicated process. The cheated person will not get in touch even if they have contacts. If you still manage to contact the seller, you can try to negotiate a refund for the car or repayment of the remaining debt; 
• proof of bona fide buyer status. This can be proven in court, so you will have to seek the help of professional lawyers. 

However, it is better not to bring it to this point. This is why there is a car check by VIN for a loan on various services.

On the secondary car market, you can find a lot of colorful ads for the sale of cars of various brands. Many of them carry certain risks. Among them is buying a car with technical defects or on credit. To avoid such troubles, it is important to take the following tips into account: 

• check the car's credit and history. Order reports on the car's history from the relevant services using the VIN code. 
• car inspection. Contact a professional car expert. You need to examine the body, engine, transmission, and other important components with him. 
• test drive. When running the car, you need to pay attention to the engine's or transmission's smoothness. You should also test the operation of the brakes, anti-lock brakes, and other safety systems. 

These tips will help you avoid fraud when buying used cars. Before buying, it is important to ensure the transaction carries no risks, even if the car has an impeccable appearance and a reasonable price. You can protect yourself by checking all the technical and legal nuances and contacting automotive experts from a trusted service station.