So, you’ve decided that your totally impractical, but super cute, red convertible is just not going to suit your lifestyle. Plus, you can’t afford it. And, to make matters worse, because the car depreciated so fast, you now owe more that what it’s worth. Now what? It’s true that you have a challenge on your hands, but you can try to sell your new car yourself.
Get the required paperwork from your state's Department of Motor Vehicles and find out what the procedures are for transferring ownership of your car.
Call your lender to determine whether you can get the lien released in your name. You cannot transfer ownership of your car while the lender still holds the lien. This presents your biggest hurdle because, in most cases, the lender wants all the money you owe before releasing the lien. Generally you must get the money from the buyer, then pay off the loan. However, many buyers are reluctant to give you the money unless you already own the car.
Ask whether you can make the sale in the lender’s lobby. If the lender agrees to this, you can bring in the buyer. The buyer hands the lender the money in cash or certified check. You must pay any shortage, which can occur if you owe more than what the car is worth, or more than what you can sell the car for. The lender then releases the lien and you can transfer ownership. Sometimes, the lender has the title, and you can sign it over right there. In other cases, the lender sends the lien-release document to the DMV, and the DMV mails the title to the new owner.
Go to the DMV with the buyer if your lender doesn’t agree to the transaction you proposed. Get a temporary operating permit at the DMV based on the bill of sale. When you get the money from the buyer, pay your lender and get the lien released.
Take out a personal loan from a bank or credit union if you can’t get a lender or buyer to agree to meet at the lender’s office or at the DMV. You can also borrow from your 401k, take out a home equity loan or line of credit, take a cash advance through your credit card or borrow the money from friends or family.
Trade your car in at the dealer if you can’t sell the car yourself. You’ll probably get less for your car that way, according to MSN Money, but trading the car is an option.
Laura Agadoni has been writing professionally since 1983. Her feature stories on area businesses, human interest and health and fitness appear in her local newspaper. She has also written and edited for a grassroots outreach effort and has been published in "Clean Eating" magazine and in "Dimensions" magazine, a CUNA Mutual publication. Agadoni has a Bachelor of Arts in communications from California State University-Fullerton.