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Is it possible to sell a car with a loan on it?
Can you sell a car you owe money on? Besides paying for my car loan, I have other expensive debts I need to pay for. I want to sell my car and use the money to pay off the other debt.
Phoebe Mah · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
Paying off debt is never fun, but choosing to sell your car can help relieve you of some financial burden. The good news is that you can sell a car with a loan on it.
To sell a 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 be removed from thetitle.
- Figure out the market value of your vehicle. Use resources likeKelley Blue Bookor Edmunds to get an idea of what your car is worth.
- Evaluate your equity. To calculate this, subtract the payoff amount from the estimated current value of your car. If this number is positive, you can sell the car, pay off the loan balance, and keep the remaining amount. If this number is negative, you will need to collect the money from the buyer, pass it along to your lender, and pay the remaining balance of your loan out of pocket to clear the debt.
- Transfer thetitleto the buyer once you’ve paid off the loan in full. All that’s left to do is provide them a bill of sale.
If you decide you want to buy a car again in the future, check out how you can purchase affordable auto insurance with
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. Choose from competitive quotes from more than 50 top insurance companies and Jerry takes care of the rest—securing your new policy and helping you cancel your old one. The average Jerry user saves $879 a year on car insurance.View full answer
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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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