How to sell a car that has a loan

how to sell a car that has a loan

Other People Are Reading

Instructions

Request information from your lender on the best ways to quickly close out your loan. You will also want to ask your loan provider to explain the process for a "lien release," which states you have no financial obligation on the vehicle. Pay off your vehicle and secure your lien release from the bank. Then advertise your car for sale in local papers and on the Internet until you find a buyer.

Open an escrow account if you cannot pay off your vehicle without selling it first. This will allow you to sell the vehicle and close out your loan simultaneously. The escrow provider will make sure payment goes to your lender, secure your lien release, and transfer the car's title to the buyer. Quite a few websites offer this type of escrow service.

Speak with your lender about transacting the sale on your behalf if you do not want to use an escrow service. Your bank will conduct the sale for you, use the proceeds to pay off

your loan and transfer the title to the new owner. All financial institutions will have processes and procedures for this type of transaction. You must speak with a representative for your lender to determine how to best proceed.

Sell the vehicle on the private market if you do not want to involve your bank. Contact your bank and determine the exact amount you need to close out your loan. Set your sale price about 10 percent above that amount. Advertise the vehicle in your local paper, on bulletin boards and on the Internet. When you find a buyer, go to your financial institution to conduct the transaction. Have the buyer give the lender a certified cashier's check for the total amount to close out your loan. The bank will then issue the lien release. Take the lien release and your buyer to the DMV and request all paperwork to sign over the title to the new owner. Complete the paperwork and submit it to the DMV representative to sign over the title and complete the transaction.

Source: ehow.com

Category: Credit

Similar articles: