Is it common to settle car finance on the day of selling?

Question

I am thinking about selling my car privately, as opposed to We Buy Any Car/a Dealership. (hopefully to get a slightly better deal)

However it has outstanding finance of about £15,000 on it.

Is it common to say on the advert that I will settle the finance on the day a buyer comes to purchase it?

I do have the funds to settle just now, however I'd rather not tie up 15k in it while I await a buyer, I'm assuming due to Covid 19 etc it will take longer to sell than usual (could be a while).

So basically await a serious buyer, agree a price and I'll phone on loud speaker and settle the outstanding bill. Then take payment and the buyer can drive off.

Thanks

Rob

ANDRE L · Answer

You don't say what the book value or asking price on this car is.

In general, in such a matter, the buyer and seller would meet at an office of the finance company, the seller would pay off the car then and there, and the seller would be given a free and clear title to the car, while they pay off the seller at the same time.

In some cases, the payoff to the finance company might be more than the selling price of the car. As an example, the car is worth $10,000 and the outstanding loan amount of $15,000. So, the buyer pays the finance company the asking price of $10,000 and the seller pays the finance company the remaining $5,000.

Anonymous · Answer

Nobody is going to pay you unless you can provide the title at the time they pay you. If you can't do this locally and in person you won't be able to find a private party buyer. (A dealer can pay off your lien as part of their deal)

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Is it common to settle car finance on the day of selling?

2 Answers