Many people find themselves in a position where theyare ready to sell their current car and purchase a new one, before their current car loan is paid off. You used to be stuck with the car until the payments were made, although now some dealers are offering to take over the payments of your current finance loan in exchange for purchasing a car from them.
But if you want to get what the car is worth, you may be wondering, how can I sell a car that is already under a car finance loan? To start, youare going to need to figure out exactly how much is left on the current car finance loan youare carrying. If you can afford to pay it off outright before selling the car, this would be the best option. Once the title is in your hand, youall be able to sell the car as you wish.
If you’re anything like most people, you might not have that sort of money sitting around though, and if you try and take out a second car finance deal while you’ve still got your first car loan, bad credit might prevent you being approved. If this applies to you there are still ways you can work this, but it gets a bit more complicated.
First of all, you can try to sell the car for the minimum amount you’d need to clear your can loan. However, this would mean taking payment from the buyer but not being able to give them clear title to the vehicle until you paid offer the loan on the car, and the loan company gives you title to the vehicle. A lot of buyers might not be willing to go through with this.
Another option is to contact the company your car loan is with and ask them if they will let you use an escrow service to sell your car. This means that when the buyer pays the money, instead of going direct to you it goes to the escrow company acting for the loan company. The loan company then transfers title of the vehicle to the buyer and once that is done they get the money from the escrow company.
Also, if you call up the finance company directly and ask them about the options for selling your car when it is still under a finance deal with them, they may well be able to help. They get this sort of enquiry quite a lot, so know the options - and even if they can’t help you directly, they can almost certainly direct you to someone who can help.
This might all seem a lot of hassle. If it does, your best option might be to look around for a new car at a dealership which offers you a way to get out of your current car finance. More and more dealerships are offering deals where new customers can trade in their current vehicle that is still under a loan agreement, and then some or all of the costs of that loan are added onto the finance deal on the new vehicle.
With this method, you can drive the new car that you want, but manage the monthly payments. Just make sure to use a car loan calculator so you know what you can and canat afford - rolling your old auto loan into your new loan can make the monthly payments higher than expected. So, now when you wonder, how can I sell a car that is already under car finance loan? Youave got a few different options to choose from!
