How to Sell a Car with Loan
If you’re thinking about getting behind the wheel of a new or used car, selling or trading in your current set of wheels is an easy way to make a little bit of space in your garage. Although, how do you sell a car with an outstanding loan?
Selling a vehicle with an active loan is simple. All you need is a bit of information and a few tips for a seamless selling experience.
Here are some helpful tips for selling a car with a loan.
Calculate the Payoff Amount
Before you can sell your vehicle, you’ll need to pay off the loan. To do that, you’ll need to know the payoff amount or how much it’ll cost to eliminate your debt. The payoff amount is typically different from the balance that’s listed your loan statement, so you’ll need to talk to your lender to make sure you get the correct number.
Once you submit the full payment for the payoff amount, you’ll be able to sell your car! From there, the lender will able to release the vehicle to a new owner and sign off on the title.
While you must pay off your loan to sell your current car, when you decide to pay will be up to you. If you have the funds to pay it off before selling, it’s best to do it as soon as you can to make the process easier and more seamless. You can also wait until the day of the sale and use the money you earn from it to pay off the loan.
Determine the Value of Your Current Car
Though it isn’t mandatory, it’s always a good idea to estimate the overall value of your car before selling to see how it can help you buy your next used vehicle. However, if you’re selling something that’s still under a loan, you’ll need to calculate how the payoff amount affects its value, too.
If the payoff amount is more than the overall value of the vehicle, you may need to use a bit of what you earned from the sale to pay off your account. If your car is worth more than the payoff amount, you’ll be able to use the difference towards your vehicle purchase for added savings.
Trading in a Car with a Loan
Trading in a vehicle to a dealership is an excellent option for many drivers. Like selling a car, it’s best to pay off your loan before trading in but working with a dealership can help you get more payment options and can make the entire process even easier.
They can handle all the paperwork. Plus, if you have negative equity or if the payoff amount is more than the value of your vehicle, they can roll over the difference to your new loan when you finance your next used car.
However, it’s important to understand that adding the negative equity from your previous loan to your new one can result in a bigger financing plan and higher monthly payments. Fortunately, doing something as simple as boosting and building your credit before financing can make it easier to be approved for the options and terms you need.
Trade in Your Current Car at Val-U-Line®
Selling or trading in a car is quick and easy, even if it still has an active loan. To learn more about the trade-in process at Val-U-Line® and how we can get you behind the wheel of your perfect new-to-you vehicle, contact us or visit any one of our nationwide used car dealers today!