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How do you make a sale on a car you have a loan on?
I recently came into some financial trouble and I need to get some cash. I decided that I can survive without a car for the time being, but I’m not sure how to sell it since I’m still making payments on it. I know that I can, but I need to know how to make a sale on a car I have a loan on.
Michael Miserendino · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
Hopefully, selling your car will be the beginning and end of your financial troubles.
Selling a car
with a loan is generally similar to selling your car normally. If you haven’t finished making payments on your car, your lender is the sole holder of the title. You will need to consult with your lender on the payoff amount, which is how much the borrower (you) needs to pay before ownership of the vehicle can be fully transferred to a new buyer.
Once you know the payoff amount, you will need to research the value of your car and if you have equity. You can use
Kelley Blue Book
, Edmunds, or Autotrader. Once you have figured out the value of your car, subtract the payoff amount from the researched price. A positive number means your car has positive equity.Assuming your car has positive equity, you will then need to meet with the buyer alongside your lender to finalize the deal and sign over the paperwork.
Another thing to keep in mind is canceling your car insurance once you sell your car.
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Jerry partners with more than 50 insurance companies, but our content is independently researched, written, and fact-checked by our team of editors and agents. We aren’t paid for reviews or other content.
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