Yes, you can sell a car that's still being financed. However, there are important steps to follow to ensure the process goes smoothly and legally.
Understanding Your Situation
First, determine your equity position:
- Positive equity:Your car is worth more than you owe
- Negative equity:You owe more than the car is worth
Step 1: Get Your Payoff Amount
Contact your lender to get the exact payoff amount. This may differ from your remaining balance due to interest and fees.
Step 2: Determine Your Car's Value
Get appraisals from multiple sources:
- Canadian Black Book
- Dealer appraisals
- Private sale comparisons
Step 3: Selling Options
Option A: Sell to a Dealer (Easiest)
Dealers like Planet Motors handle financed vehicles regularly:
- We pay off your loan directly
- Handle all paperwork
- You receive any positive equity
- If negative equity, it can be rolled into a new loan
Option B: Private Sale (More Complex)
- Buyer must agree to the process
- Payment goes to the lender first
- Title is released after payoff
- Consider using an escrow service
What If You're Underwater?
If you owe more than the car is worth:
- Pay the difference out of pocket
- Roll negative equity into a new loan
- Keep the car until you build positive equity
Let Planet Motors Help
We specialize in purchasing financed vehicles. We'll handle the lien release, payoff, and all paperwork. Contact us for a free appraisal.
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