How to Sell a Financed Car in New Zealand

Selling a financed car in New Zealand can seem harder than it is, but with the right information and steps, it can be done. Here’s a comprehensive guide to help you navigate the process based on our experience in the NZ auto industry.

Steps to Selling a Financed Car

1: Chat To Your Lender:

Start by informing your lender about your intention to sell the car. They will provide you with information about your loan balance and any potential fees for early repayment. This step is crucial to ensure you understand your financial obligations any are aware of any conditions attached to selling your vehicle.

2. Get a Payout Letter:

Request a payout letter from your lender. This document details the precise amount needed to pay off the loan. It also includes available options for how the payment should be made. This will be important to reference when communicating with potential buyers.

3. Inform Potential Buyers:

Be upfront with potential buyers about the car being under finance. There’s no point hiding it, since they can easily find out about any encumbrance through a Personal Property Securities Register (PPSR) check. Being caught out in a lie will also likely kill your chances of making a sale.

4. Pay Off the Loan:

  • Using Sale Proceeds: If the buyer agrees, they can pay the lender directly. Once the loan is settled, the lender will release the title to the buyer.
  • Before The Sale: If you have sufficient funds, you can pay off the loan before selling the car. This simplifies the sale process as you will then hold a clear title and can proceed with a normal car sale.

5. Complete the Sale:

After the loan is settled, ensure all necessary paperwork is completed. This includes providing the buyer with proof that the loan is cleared and the car is no longer encumbered. This documentation is crucial for the buyer to register the car in their name without any issues.

Alternatives to Selling a Financed Car Privately

1. Trade-In at a Dealership

If you’re planning to purchase a new car, trading in your financed vehicle at a dealership can be a convenient option. The dealer will facilitate the loan payoff and apply the remaining value towards your new car. This method often involves less hassle but offers a lower return compared to a private sale.

2. Sell to a Cash for Cars Company

These companies specialise in quick transactions and can often handle the loan payoff process for you. They provide immediate payment, which can be useful if you need to settle your loan quickly

3. Refinancing

If selling your car right away isn’t ideal, consider refinancing your car loan. This can help reduce monthly payments and make it easier to pay off the loan, then sell the car without any worries.
Important Considerations

  • Loan Type: Ensure you know whether your loan is secured or unsecured. An unsecured loan does not use your as collateral, making it way easier to sell.
  • Early Repayment Fees: Check if your loan agreement includes any fees for early repayment. These can affect your decision to sell the car early.
  • Market Value: Assess the market value of your car to ensure you can cover the remaining loan balance with the sale proceeds.

Kiwi Cash For Cars Can Help You!

You can sell your vehicle to car wreckers like us if it is non-drivable, unsellable, or too damaged to sell. You can contact wreckers like Kiwi Cash for Cars on 021 837 591 and get a free quote for your unwanted vehicle today.