Selling a car on finance is a common practice that can benefit both the seller and the buyer. It allows sellers to reach more potential buyers and gives buyers the option to finance the purchase. However, it is essential to understand the process and requirements involved before deciding to sell a car on finance.
When selling a car on finance, the seller must first obtain permission from the financing company to transfer the ownership of the vehicle. This process is known as a finance sale, and it requires the seller to settle the outstanding finance amount before transferring the ownership to the buyer.
To sell a car on finance, the seller must inform the financing company about their intention to sell the vehicle. The financing company will then provide the seller with a settlement figure, which is the total amount needed to pay off the remaining finance balance.
Once the seller receives the settlement figure from the financing company, they can proceed with finding a buyer for the vehicle. The seller and the buyer can then agree on the terms of the sale, including the selling price and payment method.
When selling a car on finance, the buyer has the option to either pay the full settlement figure to the financing company or take over the existing finance agreement. If the buyer chooses to take over the existing finance agreement, they will need to undergo a credit check to ensure they can afford the monthly payments.
Selling a car on finance can be a complex process, so it is crucial for both the seller and the buyer to carefully review the terms and conditions of the finance agreement before proceeding with the sale.
FAQs about selling a car on finance:
1. Can I sell a car if it is still under finance?
Yes, you can sell a car that is still under finance, but you must first obtain permission from the financing company and settle the outstanding finance amount before transferring the ownership to the buyer.
2. Is it possible to sell a car on finance privately?
Yes, you can sell a car on finance privately, but you must follow the appropriate steps and procedures to ensure a smooth and legal transaction.
3. What happens if the buyer fails to make payments on the car I sold on finance?
If the buyer fails to make payments on the car you sold on finance, the financing company may repossess the vehicle to recover the outstanding balance.
4. Can I sell a car on finance if I have missed payments?
Selling a car on finance when you have missed payments may be more challenging, as the financing company may require you to settle the outstanding balance before transferring ownership to the buyer.
5. Can I sell a car on finance if it is leased?
Selling a leased car on finance may have additional restrictions and requirements, so it is important to consult with the leasing company before proceeding with the sale.
6. Do I need to inform the financing company if I sell my car on finance?
Yes, you must inform the financing company if you sell your car on finance to obtain permission to transfer the ownership of the vehicle.
7. Can I sell a car on finance if it is still under warranty?
Selling a car on finance that is still under warranty is possible, but it is essential to transfer the warranty to the new owner to ensure they are covered in case of any issues.
8. Can I negotiate the selling price when selling a car on finance?
Yes, you can negotiate the selling price when selling a car on finance, but it is important to consider the outstanding finance amount and the buyer’s ability to pay.
9. Do I need to pay any fees when selling a car on finance?
There may be fees associated with selling a car on finance, such as settlement fees or administrative fees, so it is important to review the terms of the finance agreement.
10. Can I sell a car on finance if it has been involved in an accident?
Selling a car on finance that has been involved in an accident may affect the resale value and the terms of the finance agreement, so it is important to disclose any damage to potential buyers.
11. Can I sell a car on finance if it has modifications?
Selling a car on finance with modifications may also impact the resale value and the terms of the finance agreement, so it is important to inform potential buyers about any changes made to the vehicle.
12. Can I sell a car on finance if it is financed with a personal loan?
Yes, you can sell a car on finance if it is financed with a personal loan, but you must settle the outstanding loan amount before transferring ownership to the buyer.