How to Trade in a Car That is Not Paid Off?

If you’re looking to improve your Sharon travels, you’ll want to trade your car to the dealership where you’re buying your new-to-you ride. This process is straightforward and helps you boost your down payment, especially when you completely own the vehicle you’re selling. If you’re still making payments on your vehicle, you might wonder how to trade in a car that is not paid off. The Shenango Honda finance team is here to show you how to trade in a car you still owe on and offer other car buying tips to help you on your upgrade journey. Learn more below!

Do You Have Positive or Negative Equity?

Before you learn how to trade in a car you still owe on, you’ll need to determine what type of equity you have with your current vehicle. Review the two scenarios here:

• Positive equity: your vehicle’s value is worth more than what you still owe
• Negative equity: your vehicle’s value is worth less than what you still owe 

To determine which equity you have, you’ll need to compare what you currently owe vs. your trade-in value offers. If you owe more on your auto loan than your vehicle is worth, then you have negative equity. If the trade offer for your vehicle is more than what you owe, you have positive equity. Having positive equity is the most ideal position since it will boost your down payment, but you can still learn how to trade in a car that is not paid off with the help of our expert team. 

How to Trade in a Car You Still Owe On

If you want to improve your commute from Hubbard to Mercer, but have negative equity on your current vehicle, review your options here:

• Pay Off Your Loan: In an ideal world, you’d want to pay off the difference between what you currently owe and the trade value of your vehicle. If you have the spare cash to afford this option, this is your best bet. 
• Transfer Your Debt to a New Loan: You can also roll over your current loan into the loan for your new vehicle. This is generally the most popular option for drivers carrying a loan balance who want to upgrade. Remember, this method doesn’t eliminate your previous loan, it simply adds the balance to your new loan, allowing you to pay off both debts at once. 
• Shop Around for Higher Trade Offers: Third-party companies like Carvana and Carmax tend to offer high appraisals. So, you should shop your vehicle around to get the best offer. 
• Negotiate: If you feel like the dealer missed something during the appraisal process, feel free to negotiate! This can help you close the gap between what you owe and the value of your vehicle. 

Learn More About the Trade-in Process Today! 

When the time’s right for you to enjoy a higher-class travel experience, Shenango Honda is the place to shop. Our expert finance team is standing by to help you learn how to sell your car to a dealership and can even guide you through selecting where to secure financing. Visit us in Hermitage to learn more about automotive financing.