The answer to that question is, absolutely yes! You can trade in a financed car. One thing to remember about trading in a car that is not paid off is that the loan on your vehicle doesn’t go away by trading it in. You will still be responsible for the balance. If you would like additional information regarding your options for trading in a car with a remaining loan balance, SJ Denham Chrysler Jeep FIAT would be glad to assist you. We’re here to answer your questions about car loans and interest rates, selling a car, leasing a car, credit scores, and more.
How Does Trading In a Financed Car Work?
Wondering how trading in a car works? Simply follow the steps below.
Find out what you still owe on the loan. That information should be available on the statement you receive each month.
Use our Value Your Trade tool or one from a service like Kelley Blue Book to get an estimate on the value of your current vehicle. The figure you receive is only an estimate. The dealership will need to inspect the vehicle before giving you a final offer.
If the remaining amount of your auto loan is less than the trade-in offer from the dealership, you can use that extra money to help pay for the new car you have selected.
For example, if you still owe $8,000 on your loan, but the dealer offers you $9,000 to purchase the car, you will be able to pay off the loan in full and have a bonus of $1,000 that can be used on the new car you’ve purchased.
If the remaining balance of your auto loan is more than the trade-in offer, then you’ll still owe money on your car–this is called negative equity. You have the option of paying the remainder in full before you make your next vehicle purchase. Another choice is to roll over the balance into your next auto loan with the dealer.
What Does “Rolling Over” A Loan Mean?
Rolling over a loan is when a dealership says they will pay off your old loan no matter how much you owe. However, this is too good to be true. What this really means is that the cost is applied to your new loan on the next car you buy. You will end up paying the dealership back for the old loan while simultaneously paying off your new car.
Find Your Next Car at SJ Denham Chrysler Jeep FIAT Near Anderson
When you’re ready to trade in a financed car for lease or find a new car that you will love for many years to come, turn to the team at SJ Denham Chrysler Jeep FIAT near %%target _city_2%%. We want to help make your dream car as affordable as possible. Wondering when it is the best time to trade in a car? We have the details.