If the car is purchased with financing using monthly payments it will make it harder to sell. Easiest way is to pay off the lien and then proceed to sell your car easily, but what happens if you can’t come up with enough cash to pay the lien completely? There are few other options:
Car Buying Companies:
An easy way to sell your car is by using best sites to sell a car in Toronto. They will facilitate the procedure, making it easy and painless dealing with all the paperwork related with a car under financing. Above all, is safe and you will get a better value for your car.
Selling to a Dealer:
In this case, especially if your car will be used as a trade-in dealers can work with you and the financial institution which is the lien holder. Dealer can add up current amount owning to the new car loan and accounting for the trade in value of your car in the process. As your car has a trade in value in itself, then the trade in value of the car will be used against the loan, which will help somewhat.
However, dealers do not pay much for trade-ins or at least nowhere close to what you will get if you sell it yourself. So, you got to be prepared to take a hit on your car value there. On the bright side, all paperwork will be done by the dealer and you don’t have to do much. They will contact lien holder and exchange necessary information and funds to release the ownership of your car.
Sell Your Car Privately:
If you can come up with full lien owned, then this is easy. You pay the lien completely and ask your financial institution for a Lien release letter and to contact ministry of transportation to clean the title. As soon as you pay the lien they are supposed to contact ministry of transportation but never hurts to ask them to do so, in case they forget. If they do not contact Ministry to clear it, then the title will still show with a lien even though you already paid completely.
Or, you will need a buyer which is willing to pay your lien. It will get complicated as you are required to do all the work and it will not be easy to find a buyer who is willing to thru payments and paperwork with a financial institution.
However, if you reach a deal with a buyer then you will need a letter from your lien holder of your total balance which is presently owned. You will probably need to go with the buyer at your financial institution or bank to pay off the lien before purchase can take place. Will be much easier for both parties to be satisfied if all is done simultaneously, lien payment and the title exchange at the same time.
If your car value is higher that amount owned then the buyer should give you the rest after paying the lien otherwise if the car value is lower then you will need to make up for the difference at the same time.
Escrow Services:
Escrow Services are used some times in these cases. They will assure the buyer has sufficient funds to purchase the car and that he receives the title after payment. Of course, these services have fees; seller and buyer can split them or whatever arrangement you will be able to reach, as long as everyone is satisfied.