Getting clear title is the secret--whether you pay cash or via purchase order/finance.
Lines of credits are being called by banks more that you expect--I would bet the guy was too honest (ate lots of jobs for free) and did not have the financial cushion to weather the bank not renewing or calling the floor line. The banks are taking a beating right now--try to get a loan and you will see what I am saying (they are very cautious!).
Tim & Sue
Gerry (GSD) & Jammer (Sheltie)
2005 F150 4x4 Lariat 5.4L 3.73 Please buy a Hybrid...I need your gas for my 37 gallon tank!
2000 Nash 19B...comfortably pimped with a real Queen Size Bed Red Wine anyone?
I think you will still owe the bank, end of story. Loans are always with you, not manufacturers, not dealers. If they do not recieve the title, which you will find in the small print of your contract is really your responsibility to get to them, the manufacturer will issue a repo order on your trailer and you will still have a loan to pay. Just like on a house when you close and find out your contractor did not pay the sub-contractors and went bankrupt. You will still owe the subs, they will put liens on your house, and you still owe the bank. At least in this case you still have a house, just have to pay up to double.
With the court clerk in SE Washington: A 'show cause' hearing is scheduled for Monday afternoon. The are 3 couples that are the plaintiffs & the case has something to do with 'replevin', a legal term signifying the recovery by a person of goods unlawfully taken out of his or her possession, by means of a special form of legal process. Essentially that means that in some situations, a person is not able to execute 'self-help' repossession, so the alternative is replevin. I called the plaintiffs attorney office, but haven't received a call back.
With the dealer: Ever worsening RV sales conditions and over $70K in interest/flooring expenses collided in June resulting in his lender having his bank account seized. He said his attorney said that they have a fair chance of convincing the court to allow him to continue his business on at least some level.
This happened shortly after we took delivery and Northwood Mfg, the manufacturer of Arctic Fox has not been paid for our coach. Therefore, the legal owner of our coach is still Northwood. If the court allows the dealer to do business, including paying Northwood for our coach, then this will turn out to be little more than an interesting story. OTOH, if he doesn't pay Northwood, then they still own the TT.
Unfortunately, the issue of title and ownership is NOT nearly as simple as some folks would like to believe. Business often moves much faster than the supporting paperwork (title) and much happens based on established lines of credit and business relationship. This is really convenient and efficient most of the time, but when a business gets into a jam, things start getting very interesting.
I see 4 parties involved and several relationships:
Dealer & factory. Dealer took delivery of TT and owes factory for TT.
Dealer & bank. Dealer has a responsibility to the bank for forwarding the title to them.
Dealer & buyer (us). We gave dealer a deposit and signed loan docs for TT. Dealer gave us TT and by WA law is responsible to us to provide registration & title within 45 days (next Monday).
Factory & buyer (us). No direct relationship, but we have a TT that they hold title to.
Bank & factory. No direct relationship, but the factory has the title (collateral) that the bank wants.
Bank & buyer (us). We signed loan docs to purchase a TT from a dealership they do business with. How binding that obligation is if the sale of the TT becomes moot isn't clear. Normally, the bank's recourse is repossession & civil court after that. I have to question the bank's ability to prevail in court when we were no more at fault than they were, especially if they had a business relationship with that dealer.
I could be wrong--it wouldn't be the first time--but it seems to me that Northwood doesn't want our trailer back and the bank certainly doesn't want it. We're the only ones that really want it. Obviously, Northwood is owed less than what we paid for the TT and would probably be willing to accept something less than that rather than having to go to court to extradite the trailer from WA and get it back to Oregon. The bank would be happy as long as we make the payments and they eventually get the title to put in their vault for safekeeping. Sooooo, if enough $$$ can be gotten from the dealer to pay Northwood to make them willing to let us keep the trailer, everything is cool. If that doesn't work, well . . . I doubt you'll see us writing checks every month for a rig sitting in La Grande, OR.
Steve & C. J.
"Gracie" the Rough Collie & "Bo'sun" the Bichon Frise
Just curious...did the the Pasco location close too? Since the court activity is happening there, it sounds like the problems occurred there and not at the Sequim site.
I hope it all works out! I know the dealer you speak of. Never had any dealings with them but know they had been around for sometime. Sorry your involved in something like this.
PAWA wrote: Just curious...did the the Pasco location close too? Since the court activity is happening there, it sounds like the problems occurred there and not at the Sequim site.
The Pasco site is empty and shuttered. I'm in a little bit of the same situation as the OP, having bought a used Class A in May. The dealer forwarded me the registration this past week, and the state web site shows me as owner of record. Now I just need the paper title. I think I probably dodged the bullet, but just barely.
Good thing I struck a good deal for the rig and it was out of warranty.
PAWA wrote: Just curious...did the the Pasco location close too? Since the court activity is happening there, it sounds like the problems occurred there and not at the Sequim site.
I have no idea. I'm not sure it's accurate to say the Sequim location is closed. They have about a dozen older used MHs and towables on the lot. I suspect some are consignment. The place is VERY close to being closed, though.
javaseuf wrote: A manufacturer will rarely, if ever, ship an RV to a dealership unless the flooring (dealership financing) was in place. The factory is the first one that gets paid.
I would bet the manufacturer was paid and it will be the flooring company that will be looking for payment if the dealer failed to forward the funds to them.
Yup That's the way it works, no ticky no laundry!
If the DMV got the title application and sales tax forms your golden, the flooring company will be sucking wind,it's reffered to be as selling out of trust and the flooring company will be attaching everything this defunct dealer listed on his financials and more. Some flooring companys have agreements with the RV manufacturers to buy back any unsold inventories or relocate them to other dealerships willing to pick the unit up for a fraction of the cost. In your case I would see if the flooring company also has a written agreement with the manufacturer to complete all retail transactions, since the dealer had to secure the inventory by other means other than the inventory itself, which is a standard business prcatice of most large flooring companies in the event of an out of trust dealership.
* This post was
edited 07/19/08 04:59pm by Nascar24 *
Good Luck and Happy Trails
2007 Dodge 3500 4X4 MC,SRW,CTD EB
2004 Citation 29NP
Equal-i-Zer
Yamaha EF2800i
Nascar24 A lengend in my own mind, A Scary thought in someone else's!
Today, I talked with one of the attorneys for a group of plaintiffs in eastern WA that I gather are in the same boat we're in.
It seems the dealer went 'out of trust' some time this year. Exactly when hasn't been determined yet, but his primary flooring finance company discovered it in mid to late June, a couple of weeks after we took delivery. The dealer has cleared up about half of the $1.8M and it's non known yet how much is available to clear up the remainder.
The dealer's attorney agreed to some stipulations yesterday, and is forwarding the dealer's books to the primary lender, so the hearing probably off.
It's not known at this time what the status of the MSO is, or which of his 3 finance companies might have been used to cover the PO to the manufacturer. I'll be making calls on Monday to find out the answers to those questions.
From what I've heard so far, it's likely that our lender received the the MSO from the manufacturer since they've apparently funded the loan. At least I'm assuming they actually funded the loan since they sent me a statement a few days ago.
I received the 'Dealer Complaint Form' from the Dept of Licensing today. Yesterday, the clerk at the DOL intimated that their investigation would be prompt and swift, but the attorney I talked to said they're backlogged for months because of the recent number business failures.
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