How to Sell Your Car When You Still Have a Loan

I get a call about this guy that has a that he bought for $28,000, and he wants to get out of that loan because the car payments are so high and his only making $2000 a month. The interest by the way was above 20%.

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1. Car Value ( and yes it is legal to sell it )
To find out the car value you can use Kellyblue book or just check out the general market
However, usually you will not sell the car for what you paid for it
Car loses around 10-20% the first year and 50% by the time it hits year 3-5

For example:
The guy that bought the car for $28,000 and has only been paying 90 towards capital because the interest is so high
That car is only worth $14,000
So even if sold it ( he would still have a negative balance of $14k )

2. Escrow Service
Most buyers do not want to buy a car that has a lien or balance on it
Because they know they cant get the title of the car until the balance is paid off and even then it might take a 2-4 weeks to get the titles
So to ease the tension ( you can use an Escrow Service )

For example:
This means the company will hold on to the money until all conditions have been meant
And then once the conditions have been meant you will get paid
And they will handle all the paperwork to transfer the title over to the buyer

Tip: the problem, most of you are going to need that money asap to pay the loan, and hopefully get another loan to refinance the debt ( so the title can get released )

Answer: sounds like for this, you might need to get A buyer for the money the car is worth, plus b a lender for a personal loan to pay off the debt ( so the title can be release,d and most likely you can pay less money in interest )
Another Option is a Bill of Sale: where you make sure you sign a contract saying once the last payment has been made you will transfer the title to me ( for stuff like this you need a lawyer or again just use an escrow company )

3. Using the Loan as a part of the Purchase price
Now this is a fast way to take care of the problem that most people will not be able to do
If the car is worth 15k and you only have left $10k on the loan
You can go directly to the lender of the money, right a check for 10k and get title transfer and give the buyer 5 once the title has been transferred.

The moral of the story, don’t buy something you cant afford. Especially things that depreciate

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*Some of the links and other products that appear on this video are from companies in which Tommy Bryson will earn an affiliate commission or referral bonus. Tommy Bryson is part of an affiliate network and receives compensation for sending traffic to partner sites. The content in this video is accurate as of the posting date. Some of the offers mentioned may no longer be available. I'm an Accountant but I'm not your Accountant, always review information with your Accountant/CPA and your Financial Advisor.