What’s a lien sale on a car?

I’ve started shopping for used cars, and I keep seeing advertisements for lien sales. They seem to have really good deals, but I’m a little hesitant because I’ve never heard of it before. What’s a lien sale on a car?

Amber Reed · Answered on Jan 24, 2023
Reviewed by Shannon Martin, Licensed Insurance Agent.
There’s a lot of lingo to be learned when it comes to cars!
A lien sale is the sale of a car’s title, usually done at auction and to satisfy an unpaid debt. When you finance a car and get a car loan to pay for it, the lender files a lien that gives them the legal right to the car until the loan has been paid off. Once the last payment has been made, the lender releases the lien and the car is completely yours.
However, if you default on a car loan, then the lien is what gives the lender the legal right to repossess it. And repossess it they will—unless you can manage to make other arrangements!
Once the car has been repossessed, lenders will try to recoup their losses by having a lien sale. These are generally done auction style, and it’s not just cars—real estate and personal property can all be found at lien sales. It might be worth your time to check one out—who knows what you’ll find!
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