How to Sell a Car With a Lien
Ideally you want to sell a car when you have obtained full ownership of the vehicle, but it is still possible to sell a car with a lien against it. A car lien is in place when you are financing a vehicle and the title is held by the lending institution. Since car loans can last for several years, you may want to look into selling your car and getting a new one before the end of the loan term.
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Instructions
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Contact your car lender to find out the buyout amount of your loan. If you have enough money to make the payment, you will be released of all obligations to the lender. Prior to receiving the title, ask for the lender to fax you a copy of a lien release. You can show this to potential buyers to assure them that you have ownership of the vehicle.
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Use escrow to sell the car with a lien. In many cases, the seller will not have enough funds to pay off the loan amount. With escrow, you can close out the loan and transfer the car to a new owner.
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Complete the escrow transaction through an online payment site such as Escrow.com. You will pay a set fee to use its services and then agree to the terms with the buyer. Ownership will be then transferred to the buyer and he or she will be responsible for paying off the lien.
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Sign over the title at the time of the sale. Contact your lender to see if you can transfer the title to the buyer by using the funds provided from the sale. The lender may make an appointment for you and the buyer to come in as a way to facilitate the transaction.
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Visit your state's Department of Motor Vehicles (DMV). If a lender is not local, you can show the bill of sale at your DMV and provide a temporary operating permit to the buyer until you are able to get the title from the bank.
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