How to Trade in a Car That is Not Paid Off

When you trade in a car that you already own in Santan or Chandler, the process is relatively straightforward. But, what if you want to know how to trade in a car that is not paid off yet? It’s doable, but you’ll need to complete a little research ahead of time to make the process easier. Find out how to trade in a car you still owe on, and get more car buying tips at Bill Luke SanTan.

Do You Have Positive or Negative Equity?

Before you learn how to trade in a car that is not paid off, you need to assess your financial situation. Which situation best describes your car ownership?

• Positive equity: Your car is worth more than what you still owe.
• Negative equity: Your car is worth less than what you still owe.

Not sure which applies to you? Value your trade or use guides like Kelley Blue Book® Values to determine the current worth of your vehicle. If the value you find is less than the amount you owe, then it is negative equity. If the value you find is more than the amount you owe, then you have positive equity. Positive equity is easy, and you can just trade in your car without owing anything extra. But if you have negative equity, you still have options available.

Trading in a Car with Negative Equity

For Mesa drivers who have negative equity, there are a few different routes to secure a vehicle:

• Make up the difference you still owe after accounting for the trade-in price. If you have the spare cash to do this, it is by far the easiest option. You can turn your situation around immediately and start with a clean slate. However, not everyone has the income or savings to pay the difference.
• Transfer the amount you still owe over to a new loan. Instead of paying off the difference in prices outright, some drivers essentially add the old loan to the new loan. Transferring this loan amount will increase your monthly payments and may make you upside-down on your new loan. But, it can be a good option if you can’t keep up with your current payments and you want to downsize to a lower-priced vehicle.

Learn More About the Trade-in Process with Bill Luke SanTan

If you still have any questions about how to trade in a car you still owe on, our experts are here to help with customized advice suited to your unique financial situation. Contact us today to learn more about your options at Bill Luke SanTan, or stop by Gilbert to talk in person. You can also apply for financing from home!