Can You Scrap A Car With A Lien On It?

Can You Scrap A Car With A Lien On It

Can You Scrap A Car With A Lien On It?

Scrapping a car with a lien on it is a bit more complicated than scrapping a car with no lien. This is because when the car owner takes out a loan to buy a car, the lender has a legal right to hold the title of the car until the loan is paid off. Therefore, most scrap yards typically don’t purchase cars without titles. Here are a few simple steps to scrap a car with a lien.

1. Check the lien status

Contact the lienholder to confirm the lien’s status and the remaining balance. Otherwise, you can find out the debt associated with your car through a lien search, which is typically conducted through the provincial registry or a service provider like CARFAX Canada

2. Obtain written permission to scrap the car

Your bank or financing company will also not want to value loss so they may allow you to scrap the car, they will also try to mitigate losses. If you still have debt to pay you should not hesitate to contact your bank or financing company for written permission which will allow you to scrap the car with a lien on it.

3. Pay off the lien (if possible)

Generally, the lien must be paid off before you can legally scrap the car. Try to pay the debt once the debt is settled, and request your bank or financing company to release the title and other documents. Make sure that the ownership is transferred back to you and try to update the vehicle’s title at your provincial motor vehicle registry like the Ontario vehicle registry.

4. Scrap the vehicle

Once the title is clear of any liens, take the vehicle to a licensed auto wrecker or recycling company like Schmidt’s Auto Recycling.  We will handle the necessary paperwork and ensure the vehicle is scrapped legally. Visit us we are one of the best junk car removal services in Kitchener. Contact us by filling out the form, mail or call us at +15197443573.

Additional Tips

  • If you still have debt to pay and the lienholder doesn’t give permission, you may need to explore other options, like selling the vehicle or negotiating a settlement.
  • Regulations and procedures for scraping a junk car may vary by province, so it is advisable to check with your local motor vehicle registry.

Remember to stay updated, and don’t hesitate to seek professional advice if needed!


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Aniq Akram

I'm a seasoned auto enthusiast with a passion for sustainable practices. As a blogger for Schmidt's Auto Recycling, I shares my expertise on responsible car disposal, eco-friendly auto recycling methods, and the latest industry trends

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