What If My Car Loan Isn’t Paid Off Yet
Experts recommend contacting your lender before doing a trade-in to ask about their preferred transfer process. Typically, the dealership or company buying your trade-in can help you with the financing paperwork. Depending on how much you still owe, the dealer might pay the remaining balance and get the certificate of title from your lender.
If your vehicle has a higher value than the amount still owed on your loan, the difference between those totals, known as positive equity, can be applied as a credit to the down payment on a new car.
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About Kelley Blue Book Values
For over 90 years, Kelley Blue Book has been The Trusted Resource for used car values, helping car owners understand what their used car is worth. Depending on the method of disposal, there actually may be more than one Blue Book Value for the consumer’s car, truck or SUV. The Kelley Blue Book Trade In Range shows what a consumer can expect to receive for their car this week when trading it in at a dealer. The Kelley Blue Book Private Party Value reports on a fair price when selling the car to an individual instead of doing a dealer trade in. Our Values are the results of massive amounts of data, including actual sales transactions and auction prices, which are then analyzed and adjusted to account for seasonality and market trends. Kelley Blue Book Values reflect local conditions in over 100 different geographic regions and are updated weekly to give consumers the most up-to-date used car pricing information.
Have Your Vehicle Appraised
Your goal now is to get an actual offer. We recommend getting an instant offer from Edmunds. All you need to do is enter the details of your vehicle and you’ll get a trade-in offer good for seven days. Use this offer as a baseline for your negotiating, or if you’re comfortable with the offer, you can take it to a participating dealership and skip the remaining steps below.
If you still owe money on the loan, and the vehicle’s appraised value isn’t enough to pay it off, this means you are “upside down” and you’ll have to pay the difference out of pocket. If you’re not prepared to pay the difference on your car loan, trading the vehicle in at a dealership might be a better option. Keep in mind, however, that if you roll that balance into a new loan, you’ll begin a negative equity cycle that is hard to break out of.
Keep in mind that the trade-in price you’re offered at the dealership can vary depending on a number of factors including the car’s condition, the dealer’s current inventory, and the likelihood the car will sell. There may also be special promotions around trade-ins. More about that later.
If you have a Edmunds appraisal, you will already have a reference point to compare the dealer’s offer to. If not, you might want to try to get appraisals from two dealers.
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Discover How Much Negative Equity You Have
Contact your lender or log in to your account to find out just how much you currently owe on the contract. Research the estimated value for your current car online. Compare the value to the amount that you owe. If the car is worth $15,000 and you still owe $20,000, that is $5,000 of negative equity.
Ask For Offers From Multiple Dealers
You dont have to go to the dealer to start the trade-in process. Instead, you can make dealers come to you with a price. Many online value estimators, such as Kelley Blue Book and TrueCar, are linked to dealers that will extend offers based on the information you share about your car.
It also may be smart to start your negotiation where you initially got your vehicle. If the consumer is able to go to the same dealership where he or she purchased the car, he or she may be able to negotiate a better deal since they have a relationship and history with that dealership, says Meghan Davlin, director of communications at the Illinois Automobile Dealers Association.
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So how do we make money? Our partners compensate us. This may influence which products we review and write about , but it in no way affects our recommendations or advice, which are grounded in thousands of hours of research. Our partners cannot pay us to guarantee favorable reviews of their products or services.Here is a list of our partners.
Best Month/time Of Year To Trade In
Buyers often focus on the best time of year to buy a new car, whether it’s around holiday discounts or end-of-year clearances. Trade-ins can be an afterthought in this line of thinking.
But there actually is a good time to trade in a car. Values are higher in the first two quarters of the year, with larger drops in the final two quarters. Obviously, the longer you have a car, the more it will depreciate. But there are other valid reasons that keep values afloat early in the year.
First of all, there are more buyers in the market early in the year and dealerships need more cars to feed the demand. Also, a used car feels more new when it is eight or 10 months away from turning a model year older rather than just two or four months away. These are good things to keep in mind when you’re looking to either time your trade-in or negotiate with a salesperson in March instead of October.
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Pros Of Trading A Motorcycle For A Car
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Safety: Cars offer more protection for the driver and passengers than motorcycles do. From seatbelts to airbags to technological features like steering assist, cars can give you more security than motorcycles do.
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Flexibility: If you need to carry more than one passenger or want to move luggage, furniture, or even grocery shop, even the smallest car offers more storage and passenger capacity than a motorcycle.
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Comfort: Driving a car for long periods is less tiring than driving a motorcycle. Inclement weather doesn’t pose the same problems for a car as it does for a motorcycle, either.
Trading In Your Vehicle
Which vehicles are eligible for trade-in?Tesla accepts passenger cars, trucks, vans and SUVs for trade-in value towards a new or used Tesla purchase. Internal combustion engine vehicles and electric vehicles are acceptable for trade-in.
Tesla does not accept motorcycles, RVs or commercial vehicles. Non-drivable vehicles are also not accepted for trade-in.
How does the trade-in process work?After your order is placed and a VIN has been assigned, a Tesla Advisor will contact you to start the trade-in process. In order to receive a trade-in offer, trade-in details such as your VIN, mileage, zip code and photos must be submitted into your Tesla Account. Tesla will contact you when your trade-in offer is ready for review. Trade-in vehicles must be dropped at your delivery appointment.
Any applicable positive equity can be applied towards the purchase of your new or used Tesla. If you have negative equity, it must be paid either at delivery or rolled into your purchase agreement .
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Can You Trade In A Car You Just Bought
No length of time restricts you from trading in a newly purchased vehicle. However, trading in a new vehicle may be a waste of money. The depreciation that occurs as soon as you leave the dealership means your trade will have less value than a new vehicle. If you do trade it in, you will need to pay the difference on the trade, as well as for the new car.
When You Buy A New Car You May Want To Get Rid Of Your Old One Which Means Trading In Your Car May Be The Ideal Solution
Usually, when you trade in your car, a dealer buys your old car from you and you buy a new car from them.
If youre trading in your vehicle, there are steps you can take to help make sure you get the best offer for you. Every dollar counts, especially if you plan to finance your new car more money for your trade-in can mean youll need to borrow less. Its also important to consider the potential benefits and drawbacks of a trade-in versus selling your car privately.
You could just take your used car to any dealer, see if they want to buy it and then sell it to them if they do. But taking the time to do your homework could pay off.
Its also important to consider the potential benefits and drawbacks of a trade-in versus selling your car privately. Here are some steps to consider before you trade in your car.
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Trading In A Car With A Loan: Everything You Need To Know
You can trade in almost any car for a new set of wheels, including a car with a loan. A car with a loan is an automobile that you’re still paying off in installments.
You can trade in almost any car for a new set of wheels, including a car with a loan. A car with a loan is an automobile that you’re still paying off in installments.
Domestic Woes Hamper Growth
Almost three years into the pandemic, China has stuck to a strict COVID-19 containment policy that has exacted a heavy economic toll and caused widespread frustration and fatigue.
Feeble October factory and trade figures suggested the economy is struggling to get out of the mire in the last quarter of 2022, after it reported a faster-than-anticipated rebound in the third quarter.
The Ukraine war, which sparked a surge in already high inflation globally, has added to geopolitical tensions and further dampened business activity.
Chinese policymakers pledged last week to prioritise economic growth and press on with reforms, easing fears that ideology could take precedence as President Xi Jinping began a new leadership term and disruptive lockdowns continued with no clear exit strategy in sight.
Tepid domestic demand, partly weighed down by fresh COVID curbs and lockdowns in October, hurt importers.
Inbound shipments declined 0.7% from a 0.3% gain in September, below a forecast 0.1% increase, marking the weakest outcome since August 2020.
The harsh impact on demand from strict pandemic measures and a property slump was also highlighted in a broad range of Chinese imports purchases of soybeans declined to eight-year-lows last month while copper imports fell and coal imports slackened after hitting a 10-month high in September.
On top of the global slowdown, frail domestic consumption will put more strain on China’s economy for a while yet, analysts say.
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Get An Estimate From Several Dealers
Getting multiple estimates can help you make sure you get the best price. You can get estimates from the dealer where youre considering buying your vehicle, as well as from other dealerships that sell your cars make and model. For example, if you have a Toyota, your local Toyota dealer may be willing to buy your vehicle back from you. Consumer Reports also suggests taking the vehicle to a used-car dealer, because theyre often looking to buy well-kept vehicles with low mileage. Pay close attention to any special offers the dealer provides and read the fine print carefully. Some may guarantee a certain value for your trade-in, even if its in poor condition. Others may claim theyll pay off your loan, no matter how much you owe on it, when you trade in your car. But if youre underwater, they may just roll over your negative equity into your new car loan. Do your research and ask the right questions when an offer seems too good to be true.
Is It Ever A Bad Idea To Trade In A Car With A Loan
There are several circumstances where it makes more sense to pay more off your car before trading it in. You might want to delay your trade-in if:
- Your loan is fairly new. Cars depreciate as soon as they leave the dealership. Waiting until you’ve had your car a little while helps the value even out. If you wait a little, you won’t take such a financial hit.
- You’ll get penalized. Some lenders charge prepayment penalties for paying out loans before the end of the loan period. These extra charges, spelled out in the car loan terms, help offset the interest your lender won’t get when you prepay. These penalties can be so steep it’s not worth trading in your car until the loan is repaid.
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Is It Smart To Trade In A Car With Negative Equity
Financially, it can make sense to trade in a car with negative equity if the car is in poor condition and unreliable. You don’t want to put yourself in a position where your vehicle is costing you a lot of money in extensive repairs. Trading in a car with negative equity can be beneficial if you can find a vehicle that is less expensive and fits into your budget.
However, you need to be careful, as you could go into greater debt and more negative equity. If you can hold off on buying a new vehicle, you can reduce your negative equity by making extra payments on the car loan. Delaying a trade-in is often the best option financially, but it only works if you can hold off your trade-in until you’ve saved enough to pay off the loan.
Your negative equity must be paid off sooner or later. If you need a newer car sooner, you may consider paying off the negative equity all at once out of your own pocket. For example, if you currently owe $15,000 on your car and the dealer offers $12,000 for a trade-in, you can make up the $3,000 difference to your lender. Before you do this, check and make sure that there is no prepayment penalty.
Consider Selling Your Car To A Private Party
The amount of money you’ll get by trading in your car is generally less than you could get by selling it to a private party. When the dealer takes your car as a trade-in, they’re planning to sell it to someone else. They can’t offer you its full value, because they need to make a profit. They may also have to spend some money sprucing up the car to make it more presentable.
Selling your car by yourself is more work , but it may be worth it if you have the time. A relatively easy way to reach potential buyers is by advertising on one of the major used car websites.
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Dropping Off Your Trade
When can I drop off my trade-in vehicle?All trade-ins must be dropped off during your scheduled delivery appointment. Tesla cannot accept trade-ins before or after your scheduled delivery appointment.
Can I drop off my trade-in at a different delivery location?Trade-ins must be dropped off at your assigned delivery location during your scheduled delivery appointment.
Who is required to be present at delivery?All owners listed on the trade-in vehicle title and/or registration must be present at delivery to sign the trade-in documentation. Failure of this could result in delayed delivery.
Will Tesla report the trade-in sale to my state motor vehicle department? Tesla is not responsible for reporting the trade-in transaction to your state’s motor vehicle department. You may be required to notify your states motor vehicle department of the pending transaction after your trade-in documents are complete and your trade-in has been transferred to Tesla. For additional details, check with your states motor vehicle department.
Take A Look At Your Bank Account
Trading in a car involves more than assessing the vehicle. Youll also need to evaluate the state of your finances to know what you can afford on the other side of the trade.
If you are trading in a car with a loan, determine whether the trade-in value will be enough to pay off the rest of the loan. While the dealer might offer to pay your loan off, you will likely wind up adding that amount to a new loan for your next vehicle.
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Shop Your Trade Around To Different Dealers
After figuring out your cars trade-in value and the remaining loan amount, its time to head to the dealership. Dont just go to one and trade your car in there instead, its a good idea to shop your trade around. That means taking it to a couple of dealers, including Carmax, to see who can give you the best deal.
After getting the highest offer, you can then use it as leverage at the dealership where youre buying the new car from. Most times, the dealer can match or beat the offer to earn your business.
iSeeCars notes, Shoppers often assume once a purchase price is set, and the trade-in value is agreed to, the deal is done. But the deal isnt done until the paperwork is signed. In that regard, remember that you can walk away from the deal if you dont get the trade-in value that you want.
However, if your car is in poorer shape than you thought, theres a chance you will have to settle for a lower offer than you originally thought.
As a side note, we recommend cleaning the car before getting it appraised. Most car dealers will tell you that you dont have to, but its always good to put your best foot forward.
