How to Trade In a Car That Is Not Paid Off

Are you allowed to trade in a car before it’s paid off? Yes, but the process for how to trade in a car that is not paid off may get a little tricky if you owe more than the vehicle is worth. Not to worry, because Spitzer Kia Cleveland is here to help you move forward in the right direction! Get started by reading the guide below on how to trade in a car you still owe on, and contact us with any questions.

Positive vs. Negative Equity 

Determining how to trade in a car that is not paid off depends on whether you have positive or negative equity. 

• Positive equity: You owe less than your estimated car trade-in in Cleveland
• Negative equity: You owe more than your estimated car trade-in in Cleveland

You can value your trade online to estimate how much it’s worth. Then, compare it to your remaining loan balance. You have positive equity if your loan balance is lower than your trade-in estimate. You have negative equity if your loan balance exceeds your trade-in estimate.

Trading in a car with positive equity is the best situation for Independence and Brookpark drivers to be in. The loan will get paid off when you trade it in, and you’ll even have some extra money to put down on your next vehicle!

There’s more to consider when making a vehicle trade-in in Cleveland with negative equity. Learn more about your options in the next section.

How to Trade In a Car You Still Owe On with Negative Equity

If you have negative equity, you’re not alone. If possible, Parma drivers in this situation should wait until they’re caught up on car payments to trade in their vehicle, but that’s not always an option. In that case, consider the following solutions.

• Pay the difference between your loan balance and your car’s value when you trade it in. Next to waiting until your car is paid off, this is the best course of action to trade in a car with negative equity. If you don’t have the spare cash right now, consider the next option.
• Transfer your balance to a new loan. This would involve trading in your vehicle and taking out a new loan, to which the old loan balance would be added. You should be careful with this option because you’re essentially paying off your old car at the same time as your new car, meaning you’ll be upside down with the new loan. That said, you should choose a cheaper vehicle to minimize the impact and make it easier to get back on track with payments.

Let Us Help with Your Car Trade-In In Cleveland!

Determining how to trade in a car you still owe on is easier with a supportive team like Spitzer Kia Cleveland. Stop by our dealership today, and learn more about your options with our finance team. We want to help you move forward sensibly, and offer helpful solutions like used car in-house financing.