'Bargain' buy pitfalls
Published 17/02/2016 | 02:30
Advice from our legal expert on what comeback there is, if any, when buying farm machinery.
Question: I have recently leased a farm which has all the buildings that I need to get started farming, however, I do not have any of the machinery that I need to get the farm up and running. I am nervous about borrowing the large sums of money to buy brand new machinery but I am also worried about the risk of buying machinery and equipment second hand. What comeback will I have, if any, if I buy faulty machinery from another farmer?
Answer: There has rarely been a cheaper time to buy new vehicles and machinery with low to no interest available on many brands. However, for some it remains an unsustainable option and they may choose to purchase second hand instead. It is essential that these buyers are aware of what protections they have under the law.
One of the largest risks for those buying second hand vehicles or machinery is the risk that there is finance owing on them by the seller.
Although this risk is probably greatest with cars and other vehicles, there is nothing to stop a farmer selling on equipment and machinery which is subject to finance.
So what come back has the purchaser if they discover that the seller has not paid all of the finance owing on an item prior to sale?
Car and machinery ownership with outstanding finance is similar to home ownership with a mortgage, the "owner" does not legally hold the title of the car or house until the finance or mortgage is fully paid off.