There are renewed calls for consumers to do their homework before buying a car from a private seller.
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The Financial Services Complaints (FSCL) organisation, which is funded by registered financial service providers, said people were increasingly having their cars repossessed after they bought them from sellers who did not disclose there was money still owed on the vehicle.
The FSCL would typically receive about one to two complaints a year about lenders seizing consumer's cars but was now seeing that many in a month.
"We're not seeing huge numbers overall but of course those are only the people who manage to find us, we don't know how many other people out there are facing the same problem," FSCL chief executive Susan Taylor said.
Taylor said the complaints had been frustrating because FSCL handles disputes between consumers and lenders, not consumers and sellers, and there was not much it could do to help people who had bought a car from a dodgy seller.
Lenders are within their rights to repossess vehicles and it is up to buyers to do their due diligence before making a purchase, she said.
"There is a very simple step people can take, to absolutely check and make sure that there is no money owed on the car to a lender, [and that] is to check the Personal Properties Securities Register and make sure that the car is debt free so to speak."
She said people should always do credit checks on cars they are looking to buy because there is no easy fix once a car is repossessed.
"[The] only remedy is to take legal action against the person they bought the car from... to get their money back but what we sometimes find in these cases is that unfortunately the seller has disappeared without trace, so even legal action becomes an empty remedy really."
