SA Encumbered Vehicle Taken by Police - Any Recourse?

Before anyone tells me this was stupid, I know, but we have bought a vehicle that, unknown to us, is encumbered. Firs time ever that I haven't checked the PPSR register. No excuses. But it's done now.

We have had a visit from a nice policeman telling us they need to seize our car. He firstly told me it was stolen. Not sure why he would say that, probably irrelevant. But he is quite insistent that the vehicle needs to be at the police station tomorrow morning.

My question is, do we have any recourse at all? What happens next? Do we have any chance at keeping the vehicle?

 

And further to my question. Why are the police involved? Since when did defaulting your loan become a criminal matter? It's all a bit shifty, because our local policeman has just come back to me and said they changed their mind, and after speaking to the attorney general they weren't pursuing the matter. I mean why would he tell me it's stolen, when the PPSR report clearly states it isn't, and then back down when I asked about that? It's all just a bit weird.

So we have an encumbered, but not stolen vehicle. And the loan hasn't been defaulted, is still being paid regularly. I don't want to be a conspiracy theorist, but what the heck is going on?

 

Yes it's registered, insured, roadworthy and according to PPSR, encumbered but not stolen. After telling me it was stolen in the morning, and then having a visit from my husband who wanted details, he came back to see me at work to (quite sheepishly) tell me that it wasn't stolen after all; it's encumbered. And the police are no longer pursuing it any further but the bank still may.

I get that. I'm just wondering why the police were involved at all, and why did a police officer lie to me? I'm still waiting to hear from the bank.