How to Trade in a Car That is Not Paid Off

Thinking about upgrading your ride but still making payments on your current vehicle? You’re not alone. Many Indianapolis drivers wonder how to trade in a car that is not paid off, and the good news is—it’s possible. Whether you’re ready for a new model or simply want a different fit, the expert finance team at Lafayette Cadillac is here to walk you through every step of the process.

Understanding how to trade in a car that is not paid off comes down to knowing your loan balance, vehicle value, and financing options. We’re here to help make it simple and stress-free. 

Do You Have Positive or Negative Equity? 

To see how you can trade in a car that’s not paid off, you will have to first determine which of the two situations you are: 

• Positive equity: Your car is worth more than what you still owe.
• Negative equity: Your car is worth less than what you still owe. 

To calculate which equity you have, you’ll need to know how much you still owe on your current vehicle, how much the car is worth according to Kelley Blue Book® values, and how much you are getting from trade-in offers. If the offer is less than the amount you owe, then it is negative equity. However, if it is more than how much you still owe, then it is positive. 

If you have positive equity, then you’re in the most ideal position in this situation as the trade-in process will still be fairly easy. You will be able to trade in your current Frankfort ride without owing any amount and even have some you can use towards your next car!

So, can you trade in a car that’s not paid off with negative equity? Yes—but it’s important to understand how it affects your next loan. Our team will help you compare options and find a financing plan that fits your needs.

Trading in a Car with Negative Equity

For drivers who have negative equity, how do they trade in their car that’s not paid off? There are a couple of options available: 

• Make up the difference you still owe after accounting for the trade-in price. This is the first option you should consider since it can easily turn your situation for the better. While not everyone will have enough spare cash to do this, it will work in your favor if you do.
• Another option is to transfer the amount you still owe over to a new loan. Most people choose this option when they have negative equity and want to trade in their current vehicle that’s not paid off. However, transferring the amount to your new loan can increase the monthly payment, and in the end, you will still be paying for a car that you traded in. In other words, this will make you upside-down in your new loan. If you can’t keep up with your current car payments, and you are downsizing with a cheaper car, this could be the best option for you.

No matter which option you end up going with, Lafayette Cadillac recommends that you always read the contract carefully before signing the new car loan. 

Learn More About the Trade-in Process with Lafayette Cadillac 

Still asking, can you trade in a car that’s not paid off? At Lafayette Cadillac, we’ll help you evaluate your trade-in value, navigate your loan payoff, and seamlessly transition into your next vehicle. Why work with us?

• Expert finance support to explain every option clearly
• The ability to apply for financing online for a smoother experience
• Competitive vehicle appraisals and transparent trade-in offers
• A wide selection of vehicles to explore after your trade-in

Whether you’re in Delphi or nearby, you can trade in a car that’s not paid off at Lafayette Cadillac. Visit our dealership and let us help you move forward with confidence.