New Car: Settle Bank Loan with Car Finance?

gomerpyl3

Hi MSE Chaps,

I'm in the mood for a new car, but I have a slightly 'odd' situation that I'm not sure how it could play out in a Dealership. I figured I'd ask here for impartial advice.

If at all possible, I'd like to go up market, using a car finance agreement to cover the difference between what I can provide as a deposit and an agreed future value. That's simple enough, but where it gets more complicated is here:

I have a bank loan outstanding, used to buy my current car. It's about £8000 to settle it. The car is worth a bit more though, so negative equity isn't an issue

Does anyone know how I can change cars and move from a Bank loan to a car finance agreement? I'm not sure that it's actually possible, but it's almost like I'm asking the garage / dealership to buy my car for cash so I can clear that loan, then an entirely separate finance agreement for the new car - but all within the same deal.

Does that make sense? Has anyone been in this situation? I've had a search, but most questions are centered around how to pay off car finance with a bank loan (which is almost the opposite of what I want to do).

I should add that I won't sell the car privately, or go to webuyanycar etc. There are two reasons for this:

1. I'm uneasy with large sums of money in private transactions. Too much potential to be messed about & ripped off.
2. Selling a car through webuyanycar is probably fine in an emergency, but I can't help feel that it's all the worst bits of a p/x negotiation with a garage, but no potential for an upside...

Thanks

forgotmyname

The car finance company are not going to give you cash so no way to pay off a bank loan with it.

Sell the current car and pay the loan? You say its worth more than the loan. So use that money to get the finance on the car you want.

da_rule

When my girlfriend purchased a new car, she still had some finance outstanding on the old car she was using as part ex. The finance company paid off the amount due on the old car and just added it to the purchase price of the new car. The finance company may do this, but only if the car is actually security for the loan. If the loan is unsecured then they more than likely won't.

gomerpyl3

Hmm, I suspected as much. It looks like I'll be continuing monthly payments and perhaps overpaying to bring forward the end date.

Not to worry. Thanks both for your replies

Paypeanuts

I'd speak to the dealer. This must come up sometimes when people select a different dealership to the one their previous car was bought from. There may be a solution that we are not aware of.

NewUserHere

Easy.
Sell old car privately where you'll raise more money than trade in, use money to pay off loan.
Buy a new car on finance using surplus as deposit.

WBAY don't give fantastic rates!