The importance of checking for liens

DATE: | Industry bulletins

When buying a vehicle or accepting one on trade you should always do your due diligence to check for liens. Protect yourself and your customers:

  • Obtain a vehicle history report. A vehicle history report can tell you if there are liens registered against the vehicle.
  • Copy the VIN off the vehicle itself and not from another document which may be in error.
  • Check for liens even if the seller tells you there are no liens on the vehicle. If the seller tells you that there is a lien, you should still do a search to verify there is a lien and balance owing on the lien.
  • If you discover there is a lien, check with the lien holder (secured party) to determine if the lien is still valid.

What is a lien? As most of you know, a lien on a vehicle is when a creditor lends money to a debtor with the vehicle as security. This means that if the debtor defaults on the loan payments, the creditor has a right to collect what is owing on the vehicle through such means as repossessing the vehicle.


Buying from another business? Make sure you do your own lien check because the business you purchase from may not have done a lien search or may have made an error.

Buying a vehicle with a lien

If you agree to purchase the vehicle with a lien, you are responsible for the amount that is owed or the vehicle could be legally seized.


As an AMVIC-licensee your industry expects a high standard of professional conduct. Customers have a right to expect that there will be no liens on any vehicle purchased from an AMVIC-licensed business. A bad consumer experience can negatively impact all of industry.

It is best practice to always obtain a history report on every vehicle you buy from a seller so you can disclose all information to potential buyers. Under the Fair Trading Act section 6, 4(h) it is an unfair practice for a supplier to represent that “goods have or do not have a particular prior history or usage if that is different from the fact.”

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