If a dealer agrees to pay out a lien on a customer's trade-in, when must the lien be paid out?

When a dealer agrees to pay out a lien on a customer's trade-in, the lien must be paid out immediately. This requirement is crucial to ensure that the trade-in vehicle is free of any financial encumbrances before it can be resold. By paying off the lien immediately, the dealer protects both the customer and themselves from potential legal issues that might arise from selling a vehicle with an outstanding lien. This action ensures that the customer can clear their debt and move forward with the transaction, while the dealer remains compliant with regulatory standards regarding the handling of trade-in vehicles.

While other timeframes might seem reasonable, they do not guarantee the immediate resolution necessary to uphold proper business practices within the automotive industry, where liens can pose significant risks if not addressed promptly.