How To Trade In A Car That’s Not Paid Off

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The finance department at Acura of Milford gets a lot of questions about the trade-in process. One of the most common questions they get is about how to trade in a car that’s not paid off in Fairfield. While some financial professionals discourage trading in a car that’s not paid off, it’s certainly not impossible, and we can help you find the best way to trade a car that’s not paid off. Here’s how. 

Positive and Negative Equity

These are two of the first terms you’ll hear when you’re ready to trade a car. They’re simple to understand: positive equity means your car is worth more than you owe on it, while negative equity means you owe more on your car than it’s worth. 

To find out which kind of equity you have, take the amount you still owe on your car (it’s on your most recent monthly statement), and compare it to the amount you get from our Value Your Trade tool. This amount is an estimate of your vehicle’s value. You can get an exact value by bringing it to us for an appraisal. If you have positive equity, the trade process is very straight-forward. You can take our offer in cash, or put the value of your old car towards your new one. Negative equity means your trade process won’t be nearly as simple, but our finance team can help you review your options for getting the car that best suits your needs in New Haven. 

How to Trade in a Car That’s Not Paid Off and Has Negative Equity

Bridgeport drivers who find themselves in the position of having negative equity but needing a new vehicle do have some options. They include: 

  • Make up the difference you still owe after accounting for the trade-in price: If you have extra cash on hand, this is the best option if you need a new vehicle. 
  • Transfer the amount you still owe over to a new loan: This is the most commonly used method for people who have negative equity, although it might increase your monthly payments. However, it will make you upside-down on your new loan. 
  • Work with a third party and see how the trade-in offers compare to the ones you have gotten from your local dealerships: Companies like Carvana and Carmax are third-party used car companies. They tend to appraise cars at higher prices, so it might be worth getting their appraisal. 
  • Negotiate: Bring the offer you got from a third-party company back to the dealer where you started and ask them to match it. If they cannot match it, you can try to ask the dealer for a value of the difference you still owe, so you can sell your car outright to the third-party company while having the difference transferred to your new loan. 

No matter which option you choose, make sure you read the fine print on your new auto loan contract. 

Save Money When You Trade Your Car with Acura of Milford

No matter your financial situation, Acura of Milford will work hard to help you save money when you buy or trade with us. Start by taking a look at the great prices in our used vehicle inventory.


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