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17219 Highway 10 NW, Elk River, MN, 55330

Can You Trade in a Financed Car?

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Can you trade in a financed car? If you’re ready to upgrade to a new model and haven’t yet paid off your car loan, then you’ve come to the right place. The most important thing to remember, though, is that you will still be responsible for the balance of your loan. Still, trading in a financed car may be a smart decision for you to improve your drives around Rogers. Cornerstone Ford is here to explain your options, and don’t hesitate to connect with our Finance Department if you have any questions.

 

 

How Does Trading In a Financed Car Work?

The process of trading in a financed car requires you to take the following steps:

  1. Check your monthly loan statement to determine how much you still owe.
  2. Value your trade with our handy online tool to get an estimate on your current vehicle, or turn to Edmunds or Kelley Blue Book for further reference. Remember, this is simply an estimate, and you still need an appraisal for a more exact value.
  3. If your remaining loan balance is less than the trade-in estimate, then you will have money left over that can go toward the purchase of your new Ford
    1. For example, if you still owe $4,000 on your car loan, and your trade-in estimate is $7,000, then you can expect to have around $3,000 to apply toward your next vehicle.
  4. On the other hand, if the trade-in estimate is lower than your loan balance, you will have to pay the difference. This is called negative equity. In this situation, you can either pay the balance in full before heading to your Elk River dealership, or you might be able to roll over the balance to your next auto loan.

Now, you may also be wondering, “Can you trade in a financed car for a lease?” You absolutely can! The same rules apply as above, but since you won’t be taking out a new car loan, you will have to handle the remaining balance on your own.

What Does “Rolling Over” A Loan Mean?

When you roll over a loan, a dealership will pay off your old loan, no matter the balance. This amount then gets added to your new loan on the next car you buy. In this case, you are paying the dealership back for the old loan and the new loan at the same time.

Rely on Cornerstone Ford for All Your Financing Needs

Ready to trade in your financed car near Anoka? Then get in touch with Cornerstone Ford to discuss your options! You can always apply for financing online before visiting our dealership, and make sure to check out our other financing guides on topics such as what is Ford Truck Month, our extended warranty program, and leasing a car with bad credit.

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