Yes, you can trade in a financed car, but the loan sum does not disappear when you do so; it must still be paid off. The loan debt should, in most situations, be covered by the vehicle’s trade-in value, although this will depend on a number of factors, including the vehicle’s condition and age.
It doesn’t have to be tough to trade in a financed automobile in Evergreen Park, especially when you work with the Oak Lawn Toyota financing office – read on to learn more.
How Does Trading In a Financed Car Work?
- Determine how much you owe on your financed vehicle’s loan. This information should appear on your monthly payment statement.
- Use sites like Kelley Blue Book to get an estimate of how much your car is worth. Keep in mind, though, that any internet estimate is just that: a guess. Before you may get a formal offer, the vehicle must be inspected in person.
- Is the trade-in offer is greater than the remaining balance on your auto loan? The remaining funds might be used to purchase another new or used vehicle from the dealership. For example, imagine you still owe $4,000 on your car loan. The dealership offers you $7,000 for your car. You’ll have $3,000 left over from the sale that you can put toward another vehicle.
- Is the trade-in offer is less than the remaining balance on your auto loan? You’ll still owe money on the vehicle, which is known as negative equity. You can either pay off the remaining loan sum before purchasing your next vehicle, or you may be allowed to roll the balance over into your next auto loan in some situations.
What Does “Rolling Over” A Loan Mean?
When a dealership rolls over a loan, the remaining balance of one loan is paid off and the cash is applied to a new loan. If you trade in your automobile, have negative equity, and want to buy another car, this might be the best alternative. You’re effectively paying off the previous auto loan while making payments on the current one.
How To Refinance Your Car Loan
In a separate blog, we wrote down all the ways you can refinance your car.