The most common way to acquire a new vehicle is usually by financing it, since the prices of brand new cars they are too large to pay at the time of purchase. However, this more than daily custom can later affect the sale of that same vehicle if clauses are not resolved as the reservation of domain.
What is the domain reservation? Well, it is a clause of the contract of sale of a vehicle by which the bank or financial entity makes sure to receive the payment, since it gives them rights over the financed good (in this case, a car) until the debt has been resolved .
This legal mechanism gives the domain and ownership to the entity that has financed the total price of the vehicle, so that the user will not have full rights to the car (although they enjoy until the debt of their possession is compensated) until they pay the last installment.
How does it affect the purchase or sale of a second hand car?
The domain reservation is one of the administrative burdens that can be consulted requesting the Vehicle Report in Traffic, so it is an aspect that can condition the purchase or sale of a used vehicle.
First of all, as a user of vehicle possession (not an owner, as noted above), you have to understand that Until the debt with the entity is satisfied and the car is under reservation of title, it cannot be sold, canceled or even given away. Once all the fees are paid, it will be necessary to remove all the entries, including the reservation of title, in order to sell the car.
In case of being the buyer of a second-hand vehicle, it is important to check the administrative charges before that appear in your report since if the car is under reservation of title it will not be possible to change the ownership of it.
If you have purchased a used vehicle and it is discovered later that you still had the reservation, You have to find out if the previous driver’s debt is paid. In case it is, the new buyer can initiate the procedure to cancel the domain reservation.