ASSUME:

--> purchase price = 30K
--> down = 5K
--> finance = 25K
--> payments made for 2 years
--> current loan balance = 15K
--> selling price = 20K
--> The title is still with your finance company who's the lien.

So what would be the selling process for a car that you have financed, have a 15K balance on it, want to sell it a private party for 20K but dont have the title to sign over to the buyer?

 

You would have to pay the note off on your car and get a lien release, then you will get the title. You just need to provide the buyer with a bill of sale until you get the title (usually takes 5 or 6 days).

 

pay the note off on your car ??

 

How come you don't own the title if you are doing a finance? I'm not sure I understand that aspect of it. All the cars I've had the title in my possession. Is that typical?

 

You probably just had the certificate of title. You can't sell the car with that. The bank holds the real title until the not is paid off.

 

guys what exactly does "pay off the note" mean .... pay off the loan balance?

 

You've got it.

 

yup

 

ok. just the bill of sale signed by both parties, get the payment from buyer and turn the keys over to the buyer.

will the buyer be able to get tags based on just the bill of sale?

 

The bank tells me that when you get the check from buyer, provide him a bill of sale and DO NOT turn the car over yet. Pay off the car balance and get the title by mail in 5-10 business days. Sign the title over to the buyer and turn the keys over.

So basically, the buyer should not drive the car during those 5-10 days until the title is received and signed over to him.

Is this the norm?