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JGM, Solicitor
Category: Scots Law
Satisfied Customers: 12179
Experience:  30 years as a practising solicitor.
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, I bought a car by private sale in England and am concerned

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Hi, I bought a car by private sale in England and am concerned it may have a logbook loan. I have plenty of evidence to demonstrate the vehicle was bought in good faith (all the documentation, the original advertisement, AA HPI checks, written receipt, service records, keys, email correspondence etc). I am resident in Edinburgh and the car is now registered here. In the event of an issue can the car be repossessed under scottish law? What steps, if any, can I take to protect myself? How would my credit rating be affected?
Many Thanks
Thank you for your question.
As you will know when you take out a logbook loan you will be asked to hand over your vehicle’s logbook or vehicle registration document, which proves you are the registered keeper of the vehicle.
You’ll also have to sign a credit agreement and a form called a ‘bill of sale’. This means the lender now owns your vehicle on a temporary basis but you are still able to use it so long as you meet all loan repayments. These documents are recognised by law in England, Wales and Northern Ireland but are not used in Scotland.
The law only recognises a bill of sale if the lender registers it with the High Court. If it’s not registered, the lender must get a court’s approval to repossess your vehicle. You should check if the bill of sale is registered.
So if you have the vehicle registrered in your name, there should be no logbook loan.
Happy to discuss further if you can give me more information as to why you think there may be a logbook loan.
I hope this helps. Please leave a positive response so that I am credited for my time.
Customer: replied 3 years ago.

Thanks. I do not know if a log book loan has been taken out and had never heard of them until yesterday. Now I understand that it is possible to obtain a duplicate of the logbook from DVLA, that not all loans are registered with HPI and that it is quite a common problem in England and Wales. I have a bad feeling about it really and want to have some facts if this problem materialises. As I see it, my only help here is that I am resident in Scotland and the bill of sale may not be recognised. (Is that true if the transaction was actually carried out in England?) I also understand Scots law allows for purchases made in good faith and that the court would not grant a repossession if I can demonstrate this was the case. I really want to ensure I make the appropriate response if I am approached either in person or by mail. Can you advise what I should do in this case?

Worst case scenario is that any log book loan creditor could ask the High Court in England for approval to repossess the vehicle but I very much think that that order could not be enforced in Scotland.
The purchaser in good faith laws apply to Scotland but I don't think that helps as the logbook loan is under English law and the consumer credit act doesn't apply to logbook loans in England.
A registerd bill of sale for a logbook loan in England doesn't need a court order for repossession; an unregistered one does. I think that is where they may have some difficulty.
What actual evidence do you have that there may be a logbook loan?
JGM and other Scots Law Specialists are ready to help you
Customer: replied 3 years ago.

Thanks again. I have no hard evidence yet, just a very bad feeling that I have made a mistake based on my instincts at the time of transaction. I really should have stopped then. It has been almost 6 weeks now and I expect I will find out fairly imminently anyway. If the BOS isn't registered will that not just delay the inevitable? Even if the court order could not be enforced I guess that would mean that I couldn't drive in England without fear of confiscation. I understand that collection firms can be aggressive in England and I fully expect to have them waving the bill of sale in my face as proof they can just drive the vehicle away. I have moved the vehicle off-road to private land way from my residence for the time being. I hope that will stop them just towing it away before I can take some action. The only other avenue I believe I could pursue is that they are required under code of practice to register with an asset loan register. HPI checks have been clear so I guess that could be an issue for them too. I will have to pursue a complaint against them by that avenue if things happen as I expect.

Really though, I expect I will lose the car or have to pay a very large sum to retain it. I guess it will be one of life's cruel lessons. Thank you very much for your help.

EDIT: Here is the relevant section of the code of practice: Can it help? I did an AA HPI check but it does seem a general reference to a register rather than HPI.

5.1 Members shall afford innocent purchasers of vehicles, that are subject to a Bill of Sale, the same protection as afforded under the Hire-Purchase Act 1964 Part III - "Title to Motor Vehicles on Hire-Purchase or Conditional Sale‟, but only insofar as title shall transfer to the innocent purchaser in the event that the Member failed to register his interest in that vehicle with a relevant Asset Finance Register Company within 24 hours of execution of the agreement.