How to Trade in a Car That Is Not Paid Off

Trading in your older vehicle for something newer is a great way to put more money toward a down payment on a new vehicle or certified pre-owned model on our lot in Merriam. However, it becomes more complicated if you still owe money on an auto loan for your current vehicle in Wichita, KS. Luckily, learning how to trade in a car that is not paid off is fairly easy. You just have to take the right steps to make sure you accomplish this correctly. Read our guide on how to trade in a car you still owe on from Maserati of Kansas City near Lawrence, KS. We hope it helps!

Do You Have Positive or Negative Equity? 

To see how to trade in a car that’s not paid off, start by determining whether you have positive or negative equity.

• Positive equity: your car is worth more than what you still owe on the loan
• Negative equity: your car is worth less than what you still owe on the loan.

Calculating positive or negative equity is easy as you understand how to trade in a car that is not paid off. First, find out how much you still owe on the auto loan. Second, get the trade-in value for your vehicle through Kelley Blue Book and the amount you’re getting from trade-in offers. If the offer is less than the amount you owe, then it is negative equity. However, if it is more than how much you still owe, then it is positive. 

Having positive equity will make it easier when you decide how to trade in a car that is not paid off. You can use the proceeds of the trade-in to pay off the remainder of the loan before getting a newer vehicle.

However, if you have negative equity, you may have to work a bit harder as you learn how to trade in a car you still owe on.

Trading in a Car with Negative Equity

For St. Louis, MO drivers who have negative equity, you can still follow through on your quest to fully understand how to trade in a car you still owe on. It takes a little more effort, but it is doable.

• Make up the difference you still owe after accounting for the trade-in price. This is the first option you should consider since it can easily turn your situation for the better. You’ll need to have the spare cash on hand or save up for it over a few months.
• Another option is to transfer the amount you still owe over to a new loan. Most people choose this option when they have negative equity and want to trade in a car they still owe. However, a mild warning is due here. Transferring the amount to your new loan can increase the monthly payment. You’ll still be paying on a loan for the car you no longer drive. Your new auto loan will already start with negative equity because the value of the loan has the value of the newer vehicle and your older vehicle attached to it. If you can’t keep up with your current car payments and you are downsizing with a cheaper car, this is a relevant option. 

Always read the fine print of the auto loan terms before signing up for new auto financing. Plug some numbers into our payment calculator to get an estimate of your new monthly budget.

Learn More About the Trade-in Process with Maserati of Kansas City 

Do you still have questions about how to trade in a car that is not paid off? Contact us or call 913-259-4045 to speak with a member of our finance team. We’re happy to help in any way we can!