Selling Car Title Loan Debt
How to Sell a Car with Title Loan Debt: Options and Practical Tips
As tough as selling a car can be, to begin with, selling a car with title loan debt can add even more stress to the transaction. However, you’ll be relieved to know that hundreds of people go through the same struggle every day. Although it is clearly easier to sell a vehicle that is paid off, there are a variety of options that you can take advantage of when you are selling a vehicle you are still paying off.
The two main ways to get out of a title loan and sell your vehicle successfully are:
- Pay off your debt if possible.
- 2.Transfer your title to the buyer that wants to purchase your car. However, this has to pass through the loan provider you bought the vehicle from.
Below, are a few additional steps you can apply to sell your vehicle even if you owe money on it:
Ask Help From Your Lender
The first method for selling a car with title loan debt is to ask help from your lender on removing your loan and selling your vehicle. Luckily, you don’t have to figure this out yourself and can ask for guidance from your lender. All you have to do is call them and ask them for their advice on selling your vehicle that has a loan on it.
Some lenders have local offices where you can meet them and discuss your situation further. However, this is a great time to ask them other questions such as processing times, fees, and other penalties that you may incur.
Determine the Payoff Amount
To obtain a clear title, you need to first figure out how much your payoff amount is that you need to pay your lender.
Unfortunately, without paying off your full debt, you’ll be less than likely allowed to sell your car with a loan on it. By knowing your solid payout amount, you can pay off your debt before you sell your car for a clear title to offer your buyer.
To get an official payoff letter that you can view on the amount you view, you can obtain it from your primary lender. Other details on your payoff letter include payment methods available as well as what amounts you can pay on which dates.
With this letter, you’re less likely to get hit with fines or charges for not paying on time. However, your goal should be to pay off the loan in one swoop to sell your vehicle faster.
Clear Your Title
To finish the sale of your vehicle, you need to pass on a clean title to your buyer. This involves you signing the back of the title to transfer ownership. However, in most states, the title also doubles as a bill of sale that offers all the buyer’s needs to register the car. Unfortunately, if you do not have a clean title, you will be unable to offer your vehicle for sale since it is still technically the lenders.
Paying Off Your Debt
When offering your vehicle for sale, the best thing you can do is pay off your debt before selling it. This way, you’ll automatically have a clean title before selling it to your buyer. Not to mention, this allows for a smoother transaction and makes it easier to transfer it to your buyer. If you still owe money on the vehicle, it may seem like a “red flag” to some buyers.
However, keep in mind that the money you use to pay off your car is going right back into your pocket after you sell your vehicle. But, if you’re behind on your loan, you may also have to pay fees and charges that add to your debt even more.
Trading Your Car With a Dealer
Believe it or not, trading in your vehicle is often easier than selling it to an individual buyer. Most likely you’ll be working closely with a dealer who will handle the majority of the paperwork. After you pay off your loan prior, it is one of the best options to help you sell your vehicle as soon as possible. Plus, you don’t always have to buy a new vehicle after you trade one it. Some dealerships sell your traded car in an auction or sell it in their own lot.
However, one large downside to trading in a car is that you’ll get less for it than selling it to an individual buyer. However, if you still owe a lot on one car, transferring your debt to another vehicle can help you, but don’t let it snowball out of control.
Find a Private Buyer
You will most likely receive the best price if you work with a private buyer who wishes to own and use the car. Be sure to find a buyer that trusts you. If they do, the transaction can be as easy selling your car with the knowledge that the title is not available yet. For the buyer, this may seem risky. However, if you keep detailed documentation about everything, this can be an alright idea. After you receive the money, you must simply give them the car keys, pay off the title loan with their funds, and sign over the title once you receive it from the lender. This process can take a few weeks altogether. The buyer may be more comfortable paying the lender directly, however, this still requires a bit of trust.
The process might be a little different with an upside-down loan. You will need to supplement the payment from the buyer with your own money. It can be tempting to have the buyer take over your loan payments and just leave the loan in place. This is usually a bad plan. You are responsible for paying off the loan as long as it is in your name, no matter who is driving the car.
Head to the Bank
If you are dealing with a skeptical buyer when selling a car with title loan debt, it may be beneficial to meet at your bank together. When you meet at the bank, the buyer can handle the title loan buyout Texas directly. Meanwhile, you can get a clear title and sign it over to your buyer. This way, you can complete the whole transaction in one trip. However, it will take a bit of planning to accomplish this kind of meeting. Your buyer will also need to be willing to go along with this plan with you. Just make sure you call your bank before your meeting so you know which documents you must bring with you. When you call, you should also double check to be sure that a qualified staff member will be available to meet with you and your buyer when you arrive at the bank.
Use The Services of a Trusted Third Party
You also have the option to utilize a neutral third party. Make sure that you both can trust the third party so the transaction can go as smoothly as possible. For example, an escrow service can be used to protect the needs of buyers and sellers. There are even online escrow services that can help out the deal. This way, if the buyer does not pay for the car, you keep the title and if you do not deliver the car or title, you do not get a money. Just be sure to find a third party service that will be affordable and easy to work with.
Help with paying off your title loan no vehicle inspection
Getting trapped in a title loan with bad terms can be stressful. Not only are you paying too much for the loan, but the installment amounts may be unaffordable for your budget.
The good news is there is help available. At Texas Approval, we lend money to people who are desperate to get out of a bad loan situation.
With our assistance, thousands of Texas residents have benefitted from a title loan refinance. Here are a few benefits that you can expect to experience when you partner with us.
- You can continue to own your vehicle. Your new title loan at Texas Approval allows you to keep your vehicle while you repay the loan.
- You will not be subject to a credit check. Even if your credit is disrepair, you may qualify for a car title loan.
- Texas Approval does not charge our customers hidden fees or early repayment penalties. Before you sign your new loan contract, we will explain the details of your loan.
To learn more about our vehicle inspection policy for our car title loans, contact us today.