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You can transfer a car loan to another person quickly and easily when you follow the right steps. Just be aware that you’ll need to find a buyer who is willing to take on your old loan, which can take time and effort. Keep reading to find out how to transfer an auto loan, and learn when you might want to find other alternatives.
You may want to transfer a car loan to another person if you can no longer make your repayments or you want to buy a less expensive car. Just be aware that you could lose money on the sale when you transfer a car loan if you have positive equity in your vehicle. You’ll save money or break even if you have negative equity in your vehicle.
You can transfer a car loan to anyone who is willing to take over your payments by following these steps:
Contact your lender to find out if you’re allowed to transfer your car loan to another person, and what steps you need to take. They should also be able to give you an idea of what paperwork you have to fill out.
Ask your lender about restrictions to transfer a car loan to another person. You may have issues transferring your loan if you’ve missed payments, or if the person you want to transfer to has bad credit or doesn’t meet other eligibility requirements.
You’ll want to fill out your end of the paperwork in advance so that you can guide your buyer through the loan transfer process. The new buyer will likely need to visit your lender in person so that your lender can witness signatures and set up direct deposit.
Line up a buyer to transfer your car loan to. Most vehicle transfers happen between friends or family members, but you can also advertise your vehicle on a public marketplace like Kijiji, Craigslist or Facebook Marketplace to find the right candidate.
Once you’ve got an interested buyer, you should show them the vehicle and explain how to transfer an auto loan. You’ll also want to check that they have a good credit score and proof of income to show that they can make the payments.
Go into your lender or dealership with your prospective buyer to complete the transfer. Be sure to double check that your loan has transferred successfully before you allow the new buyer to drive away. This will make sure you’re not held liable for payments or damage to the car in the future.
When you transfer a car loan to another person, you should also make sure to transfer the ownership of the vehicle. You can do this by going into your local insurance agency to get the car registered and insured under the new owner’s name.
There are a handful of benefits when you transfer a car loan to another person:
Transferring a car loan to another person comes with its fair share of drawbacks as well. These include the following:
You may want to consider these options if you don’t want to transfer a car loan:
You can easily transfer a car loan to another person if this makes sense for you. Follow our step-by-step guide for how to transfer an auto loan, and learn when this might be the best option for your personal situation.
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