How do I sell a car privately if I still have a loan on it?

I want to sell my car privately before I finance a new one. This should get me more money than a trade-in. How can I do this?

Answer
You’re right! Selling a car privately is a great way to maximize your return, especially compared to what you get with a trade-in. The process will be more time-consuming, but it’s not difficult.
To start, request a payoff letter from your lender. This will give you the actual amount of money needed to pay off the loan, including all accrued interest.
Next, go online to a site like Edmunds or Kelley Blue Book to find out the actual cash value of your car. This will give you some initial values to try for pricing your car and negotiating with buyers.
Once you’ve found a buyer, you may want to get your bank involved to mediate the transaction. This will instill trust in your buyer, since shady car deals are somewhat common and may cause some buyers to hesitate or pull out last-minute.
Set up a meeting to pay the car loan, collect the check from the buyer, and let your bank handle the paperwork. Then, you’re done!
Just remember that car insurance often follows the vehicle, not the person. Let Jerry help you change your car insurance over to your new car—and find you hundreds of dollars of savings in the process.
Eric Schad
Answered on Oct 26, 2021
Eric Schad has been a freelance writer for nearly a decade, as well as an SEO specialist and editor for the past five years. Before getting behind the keyboard, he worked in the finance and music industries (the perfect combo). With a wide array of professional and personal experiences, he’s developed a knack for tone and branding across many different verticals. Away from the computer, Schad is a blues guitar shredder, crazed sports fan, and always down for a spontaneous trip anywhere around the globe.
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