Finance Question

Ben73 · 26-07-2011, 09:44 AM

I know you cannot sell a car you owe money on. But is it possible to trade the finance to a new car and sell the one that you originally financed.

E.g. My car is currently worth 20k as a trade in. I also owe about 20k on it. I want a different car that is 30k at a car yard.

So if I give the dealer my current car worth 20k. Give him 10k cash then take the new car home, change the finance to the new car and continue to pay off the 20k I owe like nothing has changed, is that possible?

I know the only way to find out 100% is to call the finance company, but I would like to hear if anyone knows anything about it.

Cúl-Báire · 26-07-2011, 09:56 AM

If the finance is "bank finance" then maybe, but most finance company contracts aren't transferable (atleast not without a great deal of brain pain); which means you need to pay out the finance before any encumbance is removed from the vehilce.

I asked Toyota Finance the same sort of thing a while ago, asking if it were possible to increase the finance, and transfer the vehicle encumbance to a vehicle of much higher value. Their short answer was no.

R1XSTA · 26-07-2011, 10:03 AM

I think thats what happens, I called up about it a few months back. I owe 10k on my car, they offered that for trade in, and then was gonna get a new car for the full 30k again.

Finance company gave me the run around and ****ed me off. Its much easier to get a loan, and then pay the finance off then pay the loan off once the cars sold.

xisled · 26-07-2011, 10:14 AM

What you do is finance the amount for your new car, and you pay the loan out with the trade in that the dealership gives you. The dealership can organise all this.

FTe342 · 26-07-2011, 10:21 AM

Quote:

Originally Posted by Ben73

I know you cannot sell a car you owe money on. But is it possible to trade the finance to a new car and sell the one that you originally financed.

E.g. My car is currently worth 20k as a trade in. I also owe about 20k on it. I want a different car that is 30k at a car yard.

So if I give the dealer my current car worth 20k. Give him 10k cash then take the new car home, change the finance to the new car and continue to pay off the 20k I owe like nothing has changed, is that possible?

I know the only way to find out 100% is to call the finance company, but I would like to hear if anyone knows anything about it.

If the original loan is unsecured, what you are proposing is feasible.

But if the loan is secured by the car, the car is encumbered and cannot be transferred without first removing the encumbrance. The dealer or buyer would do a REVS check to see if they are getting clear title to the car. This means that the finance company would have to be paid out first before they remove the encumbrance and notify REVS

Ben73 · 26-07-2011, 10:22 AM

Thanks for the quick responses. I wanted to avoid taking out another loan but it looks like that is the only way to do it.

I hate getting finance. Showing proof of income, bank statements and all that. That's why it would of been great to keep the current one. Plus I'm on a 9.5% intrest rate. Don't know if I can get it that good the second time.

I don't know if it makes a difference but the finance company is esanda through the ANZ

R1XSTA · 26-07-2011, 10:26 AM

I'm with Esanda, and its definately no can do!! Which is my problem at the moment. I have the bank lined up for the loan when my car gets sold.

9.5% Geez. I envy you, im up in 14%, no idea why. Was in my job for near 3 years, perfect record, no defaults.. Stupid system

drew`SEVNT5 · 27-07-2011, 12:08 AM

Wait, what?

It works like this:

My car owes $15k. Dealer gives me $15k trade on my $30k new car.

I get pay out letter from financier, give it to dealer. Before delivery, new financier pays 30k for new car, and at the same time, dealership pays 15k to old financier. I then hand over trade in, and take delivery of new car.