How to Trade in a Car That's Not Paid Off

Life moves quickly and you might upgrade your car before everything is ideal. Let’s say you need to learn how to trade in a car that you still owe on. Perhaps you need an SUV like the Chevy Suburban for a growing family, or maybe you need to downgrade your vehicle to a smaller used model to lower your monthly bills.

No matter the reason, you’ve got options at Ver Hoef Automotive, Inc.. If you’re wondering how to trade in a car you still owe on, we’re happy to help. Let’s dive into how to trade in a car that is not paid off in the Orange City or Hull areas.

Do You Have Positive or Negative Equity?

So, you want to learn how to trade in a car you still owe on. What’s the first step? Determine whether you have positive or negative equity.

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

If you’re unsure where you currently stand, determine your car’s value and current balance. Try sites like Kelley Blue Book® or our Value Your Trade tool to get an estimate of your car’s value. Then grab your last monthly statement to check your balance.

If your car’s value is more than your balance, that’s positive equity. Because the cost of your trade-in will cover your remaining loan payments, the trade-in process will be simple – even though you still owe money on your vehicle.

Trading in a Car with Negative Equity

As we navigate the question, “How to trade in a car that is not paid off?” it’s important to explore the other potentiality. If your car’s value is less than your balance, that’s negative equity. This makes the trade-in process a little more complicated, but that doesn’t mean you can’t move forward. You’ll just need to pick a path to upgrade. Here are the two most common options:

• Pay The Difference You Still Owe After Accounting For The Trade-in Price. If you have spare money to pay off your old loan before committing to a new loan, that’s the fastest way to get out of negative equity.
• Transfer The Amount You Still Owe to a New Loan. Most Rock Valley shoppers will take this option instead. You’ll essentially pay off the old and new loans simultaneously. You’ll still have negative equity, but you can successfully secure the car you want. Plus, it can still work out in your favor if you are downsizing.

Start the Trade-in Process with Ver Hoef Automotive, Inc.

Now you know how to trade in a car that is not paid off, but what if you have questions? Contact us to learn more about the opportunities available at Ver Hoef Automotive, Inc.. Our finance team is ready in Sioux Center, and we can help you move forward.