The Process to Sell Your Own Vehicle With a Lien

Selling your vehicle traditionally gets more money than a trade-in.
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Selling a vehicle is a unique challenge for any young couple. Trading in a vehicle eliminates the pesky details like lien releases, but guarantees a lower sales price. Selling your vehicle tends to increase the amount of money you get because you will likely garner a higher sales price on the vehicle, which is essential if you have low equity in the vehicle. Selling a vehicle with a lien means paying off your debt obligation and getting the lien release for the title.

Your Payoff Amount

Before you can sell your vehicle, you need to know how much you owe on it. Contact your current lien holder for the exact pay off amount. The sale price of the vehicle needs to cover this amount in order to get a lien release for the vehicle.

Your Car's Value

Use resources such as NADA and Kelley Blue Book to determine the value of your vehicle. These vehicle value estimation tools tell you how much your vehicle is worth selling out right or by trading it in to a vehicle. Compare your car's value to your payoff amount. When the payoff amount is more than the car's value, you are upside down in the loan. Upside down means you owe more on the car than the car is worth. You'll need to come up with the difference in the sale price and the payoff amount to procure the lien release from your creditor.

Selling Your Car

List your vehicle for sale in the local newspaper, Craigslist or place a for sale sign on the vehicle. Respond to all offers on the vehicle. Be willing to negotiate the final sales price of the vehicle. Most people consider the sale price as the starting point for negotiations. Once you sell your vehicle, take the check to current lien holder to pay off the balance on the vehicle. Your lien holder will provide a lien release for the vehicle and the title, depending on your state of residence. Give the lien release and the title to the new owner of the vehicle so they can register the vehicle in their name.

The Lien Release

The lien release is a piece of paper that states that you have fulfilled your monetary obligations to your creditor and it no longer claims property rights to your vehicle. When you finance a vehicle, the creditor gives you the money to pay for the vehicle and in return takes certain rights to the vehicle by placing a lien on it. If you fail to make payments, this lien entitles the creditor to recover the vehicle in lieu of payments. You need to get a lien release before you sell the car; otherwise the creditor still has a claim on vehicle from the new owner.

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