Mortgaged Property

During the height of the pandemic, a buyer purchased a property that was mortgaged with a local bank. The seller didn't have the cash to settle the mortgage so he required the buyer to pay for the outstanding balance with the bank–to which the buyer agreed.

On closing day, the buyer paid the outstanding balance of the mortgage, as well as the net proceeds to the seller.

Two weeks after settling the mortgage, the title still hadn't been released by the bank, so they checked the reason for the delay. As it turned out, the bank required the seller to settle his son's past due auto loan first. 🤷🏻‍♂️

What would you do if you were the buyer? What if the seller refuses to pay for the auto loan because, legally, the banks aren’t allowed to do this? Most importantly, how can we avoid this problem?