Selling a FINANCED car:HOW?

[ALFAHOLIC]

Hi all,

If I were to purchase a car by means of Finance from a financial institution, 'coz honestly speaking, who can afford to buy a R150 000 car cash?, will I be able to sell the car while it is still financed?

I need a car, financed. But in let's say a year, I'd like the option to sell this car and get another car also financed.

Is this possible?

Let's say, I purchase a car for R85000 loaned from the bank(bastards) so all in all I'd owe the bank lets say R140 000. But in a years time I'm duk of the car and want another car that fancies my mood...But I now owe the bank lets say R120 000 for my current car...how does it work?

Do I buy a car that has similar price as existing car?

Do I try and sell car for what I owe the bank...impossible

Do I trade the car for something cheaper and still pay the same monthly installments?

How does it work?

Please any advice would be appreciated before I go and sign my life away!

 

[Fazda]

Yes, no problem at all...I've only bought and sold this way for most of my 66 cars....

When you are sick and tired of your baby, you simply trade in on a newer and sweeter model. Your trade in MUST settle what is owing...or you must add to whatever you get, to settle the account.

The "settlement" very often saves you money, as it is always done as a "cash" settlement, provided you have had the car for 90 days. So if your statement says that you still owe say 90k on the car, it is 90k less compound interest, which is usually quite a bit less.

Provided your trade in is more than what you owe, you are olaughing. The first sale is settled, and a whole new one begins...easy peasy...

 

[ALFAHOLIC]

hhhmmm thanks man...

So if I were to owe the R120 000 to the bank...should my trade in be R120 000?

That is a bit of a huge ask don't you think as the dealers will ALWAYS give you less than what the actual vallue of the car is!

Hell

 

[Nerfherder]

You can but the first 3 years you will be paying off mostly interest unless you have a big deposit or overpayed on your monthly installment.

As a matter of interest my finance lady told me that I would only be able to sell my car at a profit after 3 years.

 

[Fazda]

If you owe 120k, your trade in has to be more than 120, or you will have to add to whatever you owe...

The salesman couldn't give a damn what you owe...

 

[ALFAHOLIC]

Can you OVERPAY on your monthly installment? I'm told you can't? Its not a HOUSE!!!

Or are the bank people just ONCE again out to get me?

 

[PetrolHead]

Generally speaking, a dealer takes the total value of your trade as well as any cash you may have and uses it as the deposit on your new car that needs to be financed.

It often happens that your trade-in is worthless in any case, as a result the full R 120k is normally financed with a deposit being built into the deal to add value for you.

Your best bet is to find the car you want in your price range, then go to the dealer selling it and let them take it from there. They will arrange the finance and structure the deal for you.

Most dealers are trustworthy folks who realise that if they rip you off then you will not do business there again and will certainly be telling others about your bad experience. Also, new legislation demands that they run a clean operation and the banks are getting very sharp at making sure that vehicles are financed at their correct values.

If you need a list of "safe bet" dealers just let me know. All my customers are dealers who take great pride in administration excellence and tend to be very reputable folks who care deeply for their businesses and customers.

Good luck with your car.

 

[syntax]

if u owe the bank 120k pre interest, then yes, thats what u need to settle.

Occasionally dealers can "load" the new car to help you out if you are a little short, but generally you need the settlement amount.

Also remember, if you are financing and you sell in under 2 years chances are you are going to lose a fair amount of money on the deal.

 

[PetrolHead]

Can you OVERPAY on your monthly installment? I'm told you can't? Its not a HOUSE!!!

Or are the bank people just ONCE again out to get me?

You can pay more than the amount due monthly. It will become a credit in your account.

 

[PetrolHead]

if u owe the bank 120k pre interest, then yes, thats what u need to settle.

Occasionally dealers can "load" the new car to help you out if you are a little short, but generally you need the settlement amount.

Also remember, if you are financing and you sell in under 2 years chances are you are going to lose a fair amount of money on the deal.

Agreed

 

[PetrolHead]

You can but the first 3 years you will be paying off mostly interest unless you have a big deposit or overpayed on your monthly installment.

As a matter of interest my finance lady told me that I would only be able to sell my car at a profit after 3 years.

Sell a car at a profit?? Do tell us more please.

I am under the impression that unless you trade in classics, your car will be nothing more than a gigantic money hole sucking your wallet dry.

 

[ALFAHOLIC]

PetrolHead thanks...I'm planning to get another ALFA end of the year...financed, but would probably sell it in a years time again.

I do special/rare stuff to it to up the price so I get a better car next time I trade in...as you know with ALFA's...resale value is NON EXISTANT!!!

 

[Slootvreter]

Occasionally dealers can "load" the new car to help you out if you are a little short, but generally you need the settlement amount.

Apparently they are not allowed to do that anymore.

 

[PetrolHead]

At Alpholic> The best advice I have for you is to put any ego needs you have aside and drive a car you owe nothing on for as many years as you can. Take the cash you would have had to blow on your finance and chuck it into a savings account.

Financed cars are an expensive way of getting from A to B.

 

[ALFAHOLIC]

LOL agreed!

But when you have no other choice? And you NEED to get from point A to B?

 

[Bondizzo]

Sell a car at a profit?? Do tell us more please.

I am under the impression that unless you trade in classics, your car will be nothing more than a gigantic money hole sucking your wallet dry.

Exactly, if you buying a new car the value of the car drops the moment you leave the dealership, theres no way you'll be making a profit on car unless you get it at wholesale pice.

 

[Nerfherder]

Can you OVERPAY on your monthly installment? I'm told you can't? Its not a HOUSE!!!

Or are the bank people just ONCE again out to get me?

They said that I could pay it off quicker if I wanted to... I think that different finance houses might have different rules.

 

[kaaskop]

Sell a car at a profit?? Do tell us more please.

I am under the impression that unless you trade in classics, your car will be nothing more than a gigantic money hole sucking your wallet dry.

Last year i bought a corsa ldv for 79000. With all the crap that goes in the loan and a few extras it came to about 89000. After a year i found out how much i owed the bank they told me 81000. I see the bakkie is selling for 80000 (trade 71000) so its quite possible that i can sell the car privately in a few months for a "profit"

It could be as well that just after i bought it prices climbed to 105000 for the base model.

 

[PetrolHead]

Apparently they are not allowed to do that anymore.

It is almost impossible for a dealer to avoid it, especially in the current market conditions. Unfortunatley for the dealer, the profit they make usually takes a massive knock in order to make sure you get to drive the car you want to drive at the price you can afford.

 

[Nerfherder]

Exactly, if you buying a new car the value of the car drops the moment you leave the dealership, theres no way you'll be making a profit on car unless you get it at wholesale pice.

I think you missunderstood.

I refering to the fact that if you finance the car and try and sell it before 3 years you will not cover the outstanding finance and will have to pay in.

You will never make a profit on a car unless it becomes a collectors item.