When you are selling a car and it is not paid for yet, you need to know how to sell a car with a lien. You can sell a car with a lien still attached to it, but there are some things you will have to take care of before you can finalize the sale. Contact your local motor vehicle office if you are unsure of all the paperwork that is required to complete the sales transaction on a car with a lien.
- Before you sell a car with a lien, call the lienholder. This can be a bank, finance company or any other holder of your car note. Find out the exact amount they require for the vehicle to be paid in full. Make sure to get the payoff amount for a few extra days, to allow for the sales transaction to be completed.
- Once you have the payoff amount, complete the sales transaction with the buyer of your car. After the bill of sale is signed, make sure the buyer gives you cash, a cashier’s check or money order for the purchase of your car. Personal checks take time to clear, and since you want to sell a car with a lien, every day adds interest to your payoff amount. Some lienholders require the check be made payable directly to them, so make sure to find out that information before completing the sale.
- Payoff the loan at your lender. They will release the lien they have on your car and give you the title. Sign the title over to the new owner. Make sure not to forget to remove your tag from the car. Also, remember to call your insurance agent and cancel the insurance policy for the car.
- Contact your local motor vehicle office if you have any questions. Tell them you have a car with a lien you are selling and ask for the specific paperwork they need. This can vary, depending on what state you live in.