We get questions from customers all the time about selling
or trading in their car. One of the most frequently asked questions about our
Cash for Cars or trade-in programs is regarding customers that still owe money
to another lender for their current vehicle. We will buy your car, even if you
still owe on the loan and even if you’re not buying from us. Some of our
customers are in tough financial spots and trying to sell their car for cash or
purchase a vehicle at our dealership to get a more affordable payment and avoid
defaulting on the loan. Here are some tips on how to sell or trade in your
vehicle and help make the process fast and easy.
Get Your Payoff
The first step to selling any vehicle with a loan balance is
to contact the lender and get the pay-off amount. Call your lender and request
a 10-day payoff. This is the total amount that they will accept to close the
loan. That amount is generally good for 10 days. See if your lender will negotiate with you on the pay off. It never
hurts to ask, and you may be surprised to find out that your lender will accept
a lower amount than what you actually owe. The lower the amount you have to pay
toward the bank is either money in your pocket or more value to your trade.
Coming in to the dealership with a pre-negotiated 10-day payoff is tremendously
beneficial for you and the dealership.
Determine The Value Of Your Vehicle
Once you have your payoff from the lender, use an online
value estimator like Kelly Blue Book to get an idea of the amount of equity or
negative equity you have in the vehicle.
If You’re "Under-Water" or "Upside Down"
There is a possibility that
you are “under-water” or "upside down" on your loan. After speaking
to your lender and determining the value of your car, you may find that you owe
more than your car is worth. If you are in a financial situation where it is
absolutely necessary to get out of your loan, you may be forced to take a loss
on the vehicle during sale. If you are using your vehicle as a trade on a cash
deal, you may have to put additional money toward the negative value. If you are
trading in your vehicle to get another vehicle with a lower payment, the
dealership will likely roll the balance into your new loan.
Ask Your Lender About The Payoff Process
Every lender has different processes for closing a loan.
They may need specific documents, or information. They may have a separate
payment processing center for payoffs. Asking your lender the specifics about
the process will save time and prevent possible problems.
Trading Your Vehicle
Trading your vehicle is the easiest way to sell a car that
has a loan balance. Dealers, like ours are familiar with the process and will
handle all of the paperwork for you. All you’ll need is the information for
your current auto loan account. The dealership will help handle all of the paperwork and
payoff with your lender.
If you’re really stuck and considering walking away, you can
allow the lender to repossess the vehicle. If you are left with only this
option, be sure to call the lender and offer voluntary repossession. By
volunteering to return the car, you will avoid costly repossession fees, and
may be able to work out a deal with the lender to avoid them filing a judgment
for the remaining balance. If you can avoid repossession, it’s best to do so.
Voluntary repossession is always an option, but it should be your last resort.
If you’re trying to sell your car through
our Cash for Cars program, or using your current vehicle as a down payment on
your next vehicle with us. You can use our online trade calculator to get a
free appraisal of your vehicle. Then check out our inventory and fill out a financing application.