I bought an SUV. I actually made a downpayment, and still paying the monthly payment to the finance corporation. This monthly payment is good for 5 years. However, I'm planning to sell it next year. The vehicle will be 2 years old since I acquired it, this coming January 2008. Can somebody walk me through this? Thanks so much.
2007-11-07 14:31:50 · 5 answers · asked by e-friend 1 in Business & Finance ➔ Renting & Real Estate
Yes it is possible to sell a vehicle even though it's not fully paid for. Once you sell the vehicle, you will still be responsible for paying the outstanding amount on the loan that you are currently paying to the finance company. Unfortunately, because you are still in the first half of the loan, the majority of the monthly payments are composed of interest. This ultimately means that you will still owe money on the vehicle even if you use the money that you make once you sell it to pay off your loan. If you would like to get an idea of how car loans are structured go to your local bank, or check this on line table: http://www.bankrate.com/brm/auto-loan-calculator.asp
On this website you simply enter your loan amount, the term (length of finance) in months or years, your interest rate, and the approximate date that your loan started. With this information inputed, click on the "show amortization button", and a chart showing how much you will have payed off each month is shown. This will be very useful in determining the amount that you will still owe the finance company.
2007-11-07 14:46:11 · answer #1 · answered by Anonymous · 0⤊ 1⤋
It is possible. You cannot sell your SUV unless the lienholder, the bank is satisfied, otherwise, they would lose money on loans because they are giving you a low interest rate, you sell the car, now if you default, they have nothing as colateral.
You don't own the SUV yet, the bank owns it. You will either need to pay the difference between what you sell it for and the auto loan, or you will need to somehow refinance the loan with the car buyer in a way to satisfy the bank.
My advice, if you don't have the money to pay the extra money, I would keep it. Good Luck!
2007-11-07 15:18:15 · answer #2 · answered by Anonymous · 0⤊ 1⤋
People do it all the time. Once sold though, you will be responsible for the outstanding loan amount. With a new car used a couple of years it is frequently the case that you will be 'upside down' on your loan--meaning you owe more than you can sell it for. In this case, you are responsible for the difference between what you sell it for and what you owe.
2007-11-07 14:35:53 · answer #3 · answered by raringvt 3 · 0⤊ 0⤋
Yes, you can sell now. You will have to call the finance corporation to get your payoff. You will have to payoff the loan with your buyers funds or if you did not ask enough to pay off you will have to payoff the rest at the time of sale. You have to do this so the buyer gets a clean title.
2007-11-07 16:45:41 · answer #4 · answered by yourmtgbanker 5 · 0⤊ 1⤋
In order to turn over the title to your buyer, you'll have to pay off the existing loan. You and the buyer would probably have to meet at the original lender's office so payment could be made to the lendor from the proceeds of what your buyer pays you.
Call the lender and ask them how to handle it.
2007-11-07 14:50:55 · answer #5 · answered by Judy 7 · 1⤊ 1⤋