How to Trade In a Car That is Not Paid Off

Many Westmont drivers ask us how to trade in a car you still owe on. While this can be a little more complicated than trading in a fully paid off vehicle, it’s still possible – and sometimes, it’s necessary. 

Maybe you have a Ligonier vehicle that doesn’t suit your needs, or you need to downsize to ease your budget around Murrysville. No matter your situation, the team at Sendell Subaru can help you learn how to navigate the best plan forward. In the following guide, let’s go over how to trade in a car that is not paid off.

Do You Have Positive or Negative Equity?

Before you determine how to trade in a car you still owe on, you need to assess your present situation. Namely, do you have positive or negative equity? Check your loan balance and get a free trade-in estimation to determine where you stand. 

• Positive Equity: Your car is worth more money than you currently owe.
• Negative Equity: This means you owe more money than your car is currently worth. 

If you have positive equity, your trade-in process is fairly straightforward. When you trade in your vehicle, you’ll have enough money to cover the remaining balance on your loan. You’ll probably even have money left to apply toward your new loan! But having negative equity means you’ll need to take an extra step.

How Do You Trade in a Car with Negative Equity?

So, let’s say you need to learn how to trade in a car you still owe on that has negative equity. Before you take on the new loan, you’ll need to resolve the former loan in one of two ways.

• Pay Off The Loan Outright: If you have extra funds to cover your remaining loan balance, this is the easiest way to leave your negative equity situation. You’ll no longer be upside down on the loan, and can simply move on to your next car.

• Transfer Your Loan: The more common option is to transfer your old loan over to your new loan. Essentially, you’ll pay both loans at the same time. This can put you further into negative equity, but if you’re downgrading to a cheaper model it’s the best option.

Discover Smart Financing Solutions at Sendell Subaru

Determining how to trade in a car that is not paid off might feel overwhelming, but the good news is that you have options. The finance team at Sendell Subaru would be happy to go over the best path forward for you, so you can get the car you want at a price you can afford. You can use our vehicle finder service to help you explore our existing inventory. Just call 724-837-1600 to learn more or visit our team at the dealership near Westmont for a chat!