Owning your vehicle outright is a great feeling. It’s nice to know that whatever happens, that vehicle is yours. There are no payments to accidentally miss, no repossession to worry about, and no insurance company coverage requirements (apart from those that apply to all drivers in your state).
Unfortunately, it’s not always possible to own your car outright. In many cases, you may owe money on your vehicle. And if you have negative equity in your car and need to sell it, the process can be a bit complicated.
In fact, selling a car is never an easy thing to do. If you’ve got a used car in decent shape, it can still be quite a hassle. If you’re looking to sell a junk car, finding the right buyer can be a challenge. But, trying to sell a car that you owe money on is probably the hardest of all.
How do you go about it? What are the legal ramifications? What options are even available to you in the first place? Keep reading to find out.
Selling a Car With an Outstanding Loan
When it comes to selling a vehicle that still has some form of an outstanding loan, there are a few paths you might take:
- Your first option is to sell to a private party, and then use the proceeds to pay off the balance of your loan.
- Another option you might consider is paying the remaining balance off first, then selling the vehicle.
- A third option is to use a credit card loan to pay off the loan balance before selling.
- As an alternative, you could attempt to find a dealership with a loan payoff program.
Selling to a Private Party
Selling your vehicle to a private party is an obvious option. However, it’s important to ensure that you’re getting at least the balance of the loan when selling. If the buyer doesn’t offer you enough, you’ll have to pay off the remaining balance yourself. The buyer will likely want to verify this process with you: you’ll need to take their funds, pay off the loan, have any liens released from the vehicle, and then sign the title over to them.
Pay Off the Loan Balance
This is a pretty obvious option, but it’s worth mentioning. If you have savings on hand and can pay off the loan balance in full, doing so will allow you to sell the vehicle for any amount.
Using a Credit Card Loan
If you don’t have the savings available to pay off your car loan, a zero percent interest credit card loan could do the trick. However, this can be incredibly risky. Most credit card loans with low interest rates only offer these special rates as part of an introductory incentive. If you don’t pay the loan off before the introductory period expires, you may be liable for a huge amount of interest.
Working With a Dealership
Some dealerships offer incentive programs targeted specifically at car owners with vehicles that have outstanding loans. Unfortunately, this isn’t always the best idea. Dealerships may offer to “roll your negative equity” into a new car purchase, but this can be problematic. You could end up with a massive amount of debt, and ultimately you may find yourself in an even worse situation than the one you’re currently in.
Selling a car with negative equity can be a real challenge, but selling a junk car shouldn’t be. With Junk Car Traders, selling your junk car has never been easier. To find out more, call us today at 888-323-7128.