Generally, when we talk about a pledge, we refer to a vehicle that was acquired through a loan granted by a financial institution. In this case, it is a pledge contract without the creditor’s possession, in which as long as the debt is not paid, the vehicle will continue to be the property of the bank.

In this sense, the person who buys a vehicle with a pledge cannot sell it or transfer it directly, since the property is not in their name. However, it is possible to carry out a sale under certain conditions and with a certain amount of risk.

However, if a person has a pledged vehicle and wants to dispose of it, they have several options:

  • Use a part of the vehicle payment to settle the debt with the bank and, later, carry out the lifting of the van pledge (รับจำนำรถตู้, which is the term in Thai) and the transfer.
  • Assign the debt to the person who buys the vehicle, and that he/she continues to pay the credit. This is possible after a credit study to the potential buyer.

What Are The Disadvantages Of Buying A Car On A Pledge?

The main problem that can occur when buying or selling a pledged vehicle is that one of the parties ends up cheating the other.

One situation that could arise is that the seller asks the interested buyer for the money in advance, promising that he will pay the debt and make the transfer. Upon receiving the money, the seller disappears, or lifts the pledge and does not make the change of ownership.

It is suggested that if this option is to be used, it must be ensured that there is trust between the parties. It is also advisable to carry out a notarized contract in which all the conditions and consequences of non-compliance by any of those involved are indicated. In this way, both buyer and seller shield themselves against any inconvenience.