Selling a car with finance owing

GeordieDriver

I have a car on finance with Mercedes which I need to sell. My husband and I have separated and it's a debt neither of us can afford anymore. I spoke with Mercedes to see what option I have and they are basically clear the finance. I've got a settlement figure of £16500 - webuyanycar value it at £13500 so I'm 3k short.

Can I sell via Autotrader or gumtree or whatever and say finance owing which will be cleared? Or do I need to suck up the 3k difference?

Worst part is I need to get another car which I've seen a great deal on but can't sort that out til I've got the merc sold.

MallyGirl

I believe it is tricky to sell a car privately with finance owing - unless you sell to a dealer who will settle the finance.

Would just like to comment on the webuyanycar thing - they gave me a quote of £12k on a car which I later got £18.5k on as a trade in - there must be other ways to sell it as they pay peanuts

SeanG79

Speak to the dealer where you have found the car with a great deal on and see if they will take in your vehicle as part ex and see what they offer.

Dealers buy cars on finance all the time.

Alternatively you can sell the car privately, make the new buyer aware there is existing finance on the vehicle and let the new buyer pay Mercedes Finance directly (this can be done via debit card over the phone in your presence - Mercedes Finance can issues a finance clearance letter). That way the new buyer knows the finance has been cleared and you know its been settled and can move on.

lulu_92

Webuyanycar will deliberately give you a rubbish price. OH looked up trade-in values for his Focus, got £2.6k private, £1.6k garage or £690 on webuyanycar - plus admin fees!

GeordieDriver

Thanks all - glad to hear I won't be breaking the law or anything!

Sean I didn't think about that but the new car is less (Skoda) than the outstanding finance - how would that work?

SeanG79

The dealer would settle Mercedes Finance direct, they wont give you the money.

If the dealer offers you more then the current settlement figure, you deduct that from what you are going to pay for the Skoda.

While the vehicle is on finance, you cannot sell the vehicle without the banks knowledge, but you can reach an agreement with a 3rd party that will settle the finance and then take title from you. (I have also read recently that a bank gave a customer permission to sell the vehicle and then pay the bank within 7 days but this is an exception to the norm)

GeordieDriver

So the finance owing is £16500, Skoda won't offer me that full figure would they, they'd say the car is worth say £14k. What happens with that negative? I have to pay it off or it gets added to the new finance agreement?

Sorry for being so naive.

SeanG79

yes, exactly that. The dealer may add the negative equity to the price of the Skoda (not all banks allow this) or you will need to settle it.

GeordieDriver

Thanks Sean.

I'm just reading another thread about cars and finances and I'm now thinking do want to get stuck with another finance deal. BUT I need a car and I don't have cash available so what other choice do I have.