Living conditions can change rapidly: selling a financed car, even though the loan is still running, is therefore not uncommon.
If you follow a few key rules, the bank usually plays with the sale of a financed car and you are quickly liquid again, if necessary, to purchase a more suitable vehicle.
Who owns the financed car
In many sports cars and sleek convertibles fits no stroller. But how come you in the case of unexpected offspring to a family car, if the old man does not belong to you yet? Can you sell a financed car? The short answer is “yes”.
But: car loans are earmarked. Therefore, the car belongs to the repayment of the last installment strictly speaking the credit institution.
The registration certificate Part II, formerly called “Fahrzeugbrief”, is often deposited with car financing as collateral with the bank. The idea behind it is plausible: If the debtor no longer meets his payment obligations, the creditor may sell the car.
Incidentally, the original document is not always in the safe in practice. Instead, borrowers often sign a so-called chattel transfer to the bank – which in fact identifies the four wheels as a pledge for the loan.
Sell a Financed Car: Be sure to play with open cards
To sell a financed car, you need to set some leverage: the first step is to find out how much you owe your bank. This sum is the reference value, ie the minimum price for which you offer your old car for sale. Because with the money you have to meet the demands of your financial institution. In the best case, you will even have money left over for the new wheeled pedestal.
You should inform your creditor in advance of your intentions and have your consent confirmed. In other words, you can only sell when the bank gives the green light. This transparency also determines the relationship with potential buyers: to avoid misunderstandings, you should always communicate that your car is effectively still owned by the lender.
Car finance transfer, increase or repost
Another way to sell a financed car and get a new one is to transfer the loan. Again, your bank must be informed and get involved in the change. If everything works, you will continue to pay for your old rate, but you will have a new car in the garage. The conditions for such a barter vary. On the one hand, a lot depends on the willingness of the credit institution to cooperate, on the other hand it depends on your negotiating skills.
One problem, however, is obvious: you still have no capital for the new one in your wallet. Of course, you will not receive the loan amount that you pay off as with your old one. So you need at least the down payment for the new car. The simple solution would be to sell the old car.
Because that’s not always enough, you could increase your credit. Whether and how this step works depends again on your financial institution. Alternatively, you owe your loan to a higher one: with the new loan you pay off the old one and buy a new car.