How to Trade in a Car That is Not Paid Off

Car keys in a lock

Irvine drivers know that trading in your car at a dealership is a popular option to upgrade to a new vehicle or get some instant cash in hand. While it’s a straightforward process when your car is fully paid off, things can get a bit more complicated if you still have outstanding payments. So, how can you effectively trade in a car that’s not paid off? Don’t worry, because Mercedes-Benz of Foothill Ranch is here to help with our seamless financing options!

So, do you know how to trade in a car that is not paid off? Check out our financing options at Mercedes-Benz of Foothill Ranch and learn how you can trade in your car that’s not paid off. 


Do You Have Positive or Negative Equity? 

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

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

To calculate which equity you have, you’ll need to know how much you still owe on your current vehicle, how much the car is worth according to Kelley Blue Book® values, and how much you are getting from trade-in offers. If the offer is less than the amount you owe, then it is negative equity. However, if it is more than how much you still owe, then it is positive. 

If you have positive equity, then you’re in the most ideal position. You’ll be able to trade in your current Orange County cruiser without owing any amount, and can even use any remaining funds towards the purchase of your next car!

If you have negative equity, you will need to consider your options and see which one will work best for your financial situation.

Trading in a Car with Negative Equity

For Trabuco Canyon drivers who have negative equity, you might be asking how to trade in a car you still owe on. There are a couple of options available: 

  • Make up the difference you still owe after accounting for the trade-in price. This is the first option you should consider since it can easily turn your situation for the better. While not everyone will have enough spare cash to do this, it will work in your favor if you do.
  • Another option is to transfer the amount you still owe over to a new loan. Most people choose this option when they have negative equity and want to trade in their current vehicle that’s not paid off. However, it can increase the monthly payment. If you can’t keep up with your current car payments and you are downsizing with a cheaper car, this could be the best option for you.

Now you know how to trade in a car you still owe on. But no matter which options you end up going with, Mercedes-Benz of Foothill Ranch recommends you always read the contract carefully before signing any new car loan. 

Learn More About the Trade-in Process with Mercedes-Benz of Foothill Ranch 

If you still have questions about trading in your car that’s not paid off, don’t worry! Contact Mercedes-Benz of Foothill Ranch today, and we’ll be more than happy to walk you through how to trade in a car that is not paid off. We understand that the process can be a bit challenging, but our team is here to guide you every step of the way. Whether you need advice on dealing with positive or negative equity, we’ve got you covered!

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