How to Trade in a Car That is Not Paid Off

 
As a Darlington driver, you may be familiar with trading in a vehicle at a dealership for a new car or cash. The process is relatively simple if your car is fully paid off. But how do you trade in a car that is not paid off? The finance team at Five Star Chevrolet Florence is here to guide you through the steps of how to trade in a car you still owe on, so keep reading to learn more about trading in a vehicle with a loan attached to it. 

Understanding Your Vehicle’s Equity 

To figure out how to trade in a car that is not paid off, you first need to determine your equity situation. Here’s what you need to know:

• Positive equity: Your car’s trade-in value is higher than the remaining balance on your loan.
• Negative equity: Your car’s trade-in value is less than what you still owe. 

To determine your equity, check how much you owe on your current loan, look up your car’s value using resources like Kelley Blue Book®, and compare it to the trade-in offers you receive. Positive equity means a smoother trade-in process, as you’ll have extra funds to put toward your next vehicle. Negative equity requires more consideration and planning. 

Trading in a Car with Positive Equity

If you have positive equity, trading in your car is straightforward. You can use the extra value as a down payment on your next car. This process is ideal and simplifies how to trade in a car you still owe on.

Trading in a Car with Negative Equity

So, how do you trade in a car you still owe on if you have negative equity? Marion drivers have a few options:

• Pay the Difference: Cover the gap between your loan balance and the trade-in value out of pocket. This can be a quick fix if you have the funds available.
• Roll Over the Balance: Add the remaining loan amount to your new car loan. While convenient, this increases your new loan amount and monthly payments. This approach is common but can make your financial situation more complex.

No matter which option you choose, we suggest you always read the contract carefully before agreeing to a new car loan. 

Experience the Trade-in Process at Five Star Chevrolet Florence 

To get started with trading in a car that is not paid off, gather all necessary documents including your loan payoff information, vehicle title, and registration. Then visit Five Star Chevrolet Florence to discuss your options with our finance experts.

While you’re here, ask about our exclusive lifetime powertrain warranty offered with new vehicles, ensuring peace of mind for as long as you own your car. We also offer a limited powertrain warranty on our used vehicles, ensuring reliability and value while traveling in the Sumter area. Contact us today to learn more about trading in a car that is not paid off, and let us help you find the best solution for your needs. We’re committed to making the trade-in process as smooth and stress-free as possible. Visit us in Florence today!