Is it possible to sell a car that’s on finance? Who owns the car? who to pay? how to pay? selling a financed car can be a tricky one especially when selling to a private individual. We, however, can be relatively easier when selling your financed car. But why is that?
Short answer, the finance company. Whoever lends the money to buy a vehicle has an interest / owns the vehicle, also knowns as a lender or finance company. For example, if you were to finance a vehicle from an independent dealer, a lender/finance company would buy that vehicle from the dealer and create a contract between the buyer ( yourself) and the lender to purchase the vehicle from the lender by the means of a payment scheme. Essentially the dealer has sold the vehicle to the lender and you are buying that vehicle from the lender/finance company.
The settlement figure shall be essential when selling a car on finance. This figure shall be the remaining sum of the vehicle to be paid to the lender including any interest, this figure could be more or less than what the vehicle is worth due to factors such as mileage and any damage which can impact the value of the vehicle but will not change what is owed to the lender. When buying or selling a car on finance this figure must be settled.
The responsibility of paying the settlement figure in a private sales is always the seller, this can make selling a financed car privately a bit of a hassle, the lender has the right to repossess the vehicle if payments arent made, That is to say, that even though you may have bought the car, if the previous owner hasn’t paid the full settlement figure the lender has the right to repossess your car.
Selling to a dealer or car buying company is different, there are laws in place to protect the seller. When a car is sold to a dealer all responsibility is transferred to the dealer and the seller is no longer liable for any legal action. If you are trying to sell your car on finance why not try Local Car Buyer, who could offer to buy your car on finance from your location.