How to Sell a Privately Financed Car

Selling a privately financed car

You can sell your privately financed car even if you owe money on your loan. For some people the thought may be stressful or overwhelming. Here is a guideline that will help you have a less painful experience.

Instructions

1. Clean your car. Include both the exterior and interior thoroughly. Afterwards, get your digital camera. Move your vehicle to a lighted location where you can easily take images from all angles.

2. Take a lot of pictures of your car. Walk around and get images from the front, back and sides of the exterior. Include images of the interior seating, dashboard and any other distinguishing features.

3. Download your images to your computer. Crop and sharpen your pictures. Use Photoshop or other photo editing software to adjust the size of your images to no more than 500 pixels wide. After you adjust the size, sharpen the image and save it.

4. Find out what you owe on your privately financed car. In order to sell and transfer ownership of your vehicle to another party, your loan amount will have to be paid off. Contact the company that gave you the loan. Ask for your total "payoff" amount with its expiration date (since loans have interest, the amount owed changes every couple of weeks). Write it down for your reference.

5. Determine your selling price. Go to Carfax.com or Edmunds.com to get an estimate on what your vehicle is worth. Take that price and compare it to the "payoff" amount your lender gave you. If you owe very little on your loan, the price estimate carries more weight. Alternatively, you should consider the payoff into your selling price if your loan balance is high.

6. Set up an ad to sell your car online. Go to a reputable website like AutoTrader.com or Cars.com. Create your ad with a lot of descriptive notes about the car's features and condition. Add in your selling price and contact information. Upload lots of pictures of your car. People are visual, and will more likely look at your ad and contact you if images are displayed.

7. Sell your car. When you receive the money from the buyer, you need to payoff your loan. Contact your finance company and get their address to overnight the payoff amount by FedEx (or other overnight mailing service). Once your lender receives your payment and processes it (usually a few weeks), they will send you the vehicle title with the lien section signed off, or a notarized lien release.

8. Prepare the DMV (Department of Motor Vehicles) paperwork to transfer ownership of your car to the new buyer. If your lender gives you the vehicle title, sign off the section where you release your liability. If you have a lien release, you will need to fill out an "Application for Vehicle Title." Check with your DMV for the proper form. Fill out the section where you are releasing liability to the new owner and attach the lien release form. Give all of the DMV documentation to the buyer along with the registration. The buyer can then go to the DMV himself and apply for a new vehicle title in his name.

Resources

• AutoTrader.com--a great place to sell your car
• Cars.com is another reputable site where you can sell your car.