Can we sell a car that is on loan?

Can you sell a car with a loan on it? My son used to have a gambling addiction. He’s turned his life around and is now a social worker. That said, there is still some remaining gambling debt he has to pay but doesn’t have the money for. My wife and I have a loan on my car, but we want to sell it to help pay off his debt.

Answer
Wow, your son is very lucky to have parents like you two! Selling a car with a loan on it is possible, but takes some work and patience. You will need to find a buyer who can either pay the loan in full or refinance the loan in their name.
To sell your car with a loan on it, follow these steps:
  • Determine the payoff amount for your loan. Paying off the loan is also the only way for the lender to no longer have a lien on the vehicle.
  • Research the value of your vehicle. You can use free resources like Kelley Blue Book or Edmunds.
  • Determine your equity. To calculate this, subtract the payoff value from the estimated cost of your car. If this number is negative, this means you have an upside-down loan. You will need to give the lender all of the money from the car’s sale to pay off the loan. If this number is positive, you will sell the car, pay off the loan balance, and pocket the remaining amount as profit!
  • Transfer the title to the buyer.
You can find more ways to save money to help your son. Try using the number-one-rated car insurance app, Jerry, to find lower rates on your car insurance. Jerry compares personalized quotes from more than 50 top providers and delivers the best deals to your phone in minutes for free. The average Jerry user saves $879 a year on car insurance!
Phoebe Mah
Answered on Dec 06, 2021
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