If a car is sold as is and now is not working, what is my recourse if the buyer is behind on payments?

I agreed to sell my car to a friend of my husband’s, allowing her to make monthly payments. The car was sold as is. We did download a contract from a website and had it notarized. The car is now not working. She was supposed to pay us $500 at the end of this month, but hasn’t. This $500 would still not bring her up to date. She is now saying that she doesn’t want the car. What actions can I take against her? I want the money that she owes us. I do not want a non-working car. Is there anything we can do?

Asked on September 2, 2011 under Bankruptcy Law, Arizona


MD, Member, California Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

Here is the problem. Check your state laws on whether you need a license to finance such a vehicle in your state for a buyer (sales finance license). If you do, you are looking at possibly having an unenforceable contract. If you do need a license, then your borrower/buyer can indeed consider this an invalid/void or voidable contract and you are left high and dry. Usually you would be left with nothing left owed on the car and would need to release title to her if you haven't already done so. Check this out first. If you don't need a license and this contract was okay legally in your state, then her purchasing the car "as is" pretty much makes her out of luck and doesn't require you to do anything to fix it. You can now have leave to sue her for the rest of the money owed.

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