No matter why you find yourself no longer in need of your car, things are a little more complicated if you don’t own your vehicle outright. Lenders often don’t care if you can’t afford your payment or can’t drive anymore—let alone if the issue is something more in your control, like, say, you got married or moved in with someone and no longer need one of your cars—a contract is a contract.
So, what can you do if you no longer want your car, can’t make your payment, and can’t afford to pay your remaining balance? The answer lies in how the vehicle is financed.
What to Do If Your Car Is Financed
If you need to sell your car and you have a loan, you will need to pay off the existing balance. This is an easy thing to do when the value of the vehicle exceeds the outstanding loan amount. You can sell the car and pay off the balance. You may even make some profit.
Things are different if your loan balance is bigger than the market value of the car. This unfortunate position is called being upside down on your loan. It can happen if you buy your car new and it depreciates by thousands of dollars the minute you drive it off the lot. It also happens when you trade in your old car, and your old outstanding loan is rolled over to finance the new car.
The best thing to do if you can no longer afford the car payments is to sell the car yourself. This is the only way that you have a good chance of reaching a fair price for the vehicle without owing anybody a commission.
Be on the lookout for car dealers who are masquerading as private car buyers. They will turn up to view your car and tell you that it is not worth the asking price. They will use scare tactics and highly emotional persuasive strong-arming to try and get you to accept a low offer. Stick to your price and keep looking for a private buyer. If the amount you receive is not enough to pay off the loan entirely, take out a small loan to make up the shortfall or pay it out of your own account.
What to Do if Your Car Is Leased
If you have signed an auto lease agreement and need to get rid of your car, you are in a much better position. To get out of car lease early, all you have to do is contact a lease transfer and takeover company. These helpful companies allow you to exit your car lease, avoid the penalties charged by the car leasing company, and also save thousands when compared to other expensive alternatives.
While there are other ways of handling things when you no longer need or want your car, the methods covered above are the most reliable.