4 Tips For Selling a Car With a Lien
Many people think that if they still owe money on their car, they either can’t sell it or it is much more difficult to sell. While there is an extra step or two in the process, you can still sell a car with a lien. You will also need to decide if you want to sell to a dealership or sell it privately. Here are some tips for selling a car with a lien.
First Determine the Pay Off Amount
Before you can sell the car you should determine how much you owe on it. This is an important step, whether you are selling the car privately or selling it to the dealer when you purchase a new car. The payoff is the amount you need to pay in order to get the title from the lienholder, and it will include any interest and fees that have incurred since the day you took out the loan.
Selling to a Dealer
Selling a car with a lien to a dealer is the easiest way to do it. The dealer will contact your lender and pay off your loan so you don’t have to worry about it yourself. Once they pay off the loan, they will give you a check for any amount that is over the sale price. You can then decide if you want to keep this or put it towards your new car. You will also want to make sure that you get the documentation from the dealer and the lienholder that your loan is paid off so you don’t run into problems later.
Selling privately takes more work on your part. Make sure to make a note in the listing that there is a lien on the vehicle. This helps to avoid any confusion when it comes time to negotiate. Both you and the buyer can go to the lienholder to make the transaction of paying off the loan or transferring the loan. Ownership is transferred from the bank to the buyer if they are paying off the car and then you can go to your dealership to purchase a new car.
Use an Escrow Service
An escrow service can help to protect all of the parties involved in the sale. They will secure the funds needed by the buyer until they actually have possession of the car. This also helps the seller, because they will know that the buyer actually has the money for the car. The escrow company takes over the responsibility of taking the payments from the buyer so you are not responsible for it, and it keeps your credit in good standing.
Selling a car with a lien on it takes a little more time and effort, but it is still possible. If you want to take the guesswork out of the process, go to your car dealership where they are experienced in dealing with all kinds of transactions. They will know just what to do and make it quicker and easier for you.