How to Trade in a Car That is Not Paid Off?

You’ve probably heard that you can take your car from Mentor or somewhere nearby to a place like Mazda of Bedford for either their next vehicle or for cash. The trade-in process is straightforward if your car is fully paid off, but can you trade in a car that’s not paid off? Trading in a car that’s not paid off takes a couple extra steps, but it’s still a relatively painless process. And when you’ve got that car traded in and you’re looking for your next one, we can finance it for you no sweat!

Do You Have Positive or Negative Equity? 

Trading in a car you owe money on in Cleveland is a question of equity. You can have either positive equity or negative equity. These are the two definitions:

• Positive equity: your car is worth more than what you owe
• Negative equity: what you owe is more than what your car is worth

To see how you can trade in a car that’s not paid off, you will have to first determine which of the two situations you are: 

• Positive equity: your car is worth more than what you still owe
• Negative equity: your car is worth less than what you still owe 

Using a tool like our value your trade tool can help you get an idea of what your equity is. All you have to do is calculate the value of your car, calculate how much left you have on your loan (typically stated on your most recent loan statement), and just go value of your car minus amount owed. If the number is positive, you have positive equity. If it’s negative, you have negative equity.

Trading in a Car with Negative Equity

If you’re a driver in Beachwood with negative equity, can you trade in a car that’s not paid off? There are several things you can do to make the situation better:

• Pay the difference after accounting for the trade-in price. Not everyone has the cash to do this, but this is the best option because it saves you money on interest long-run.
• Transfer the amount you owe to a new loan. You can roll over your outstanding balance on the old loan to a new loan, consolidating it into one payment. However, this means you’ll still be paying that old loan.
• Compare trade-in offers. Try a place like Carvana or Carmax to have a negotiating tool for when you come to the dealership.

And as always, read your contract carefully before signing anything, just to make sure.

Learn More About the Trade-in Process with Mazda of Bedford 

Want to know more about trading in a car you owe money on? Mazda of Bedford would love to guide you through the process! Contact us today and we’ll help you through any questions you may have.