Overhaulin'

How do you sell a car to a private buyer if the bank still has a lien?

The bank won't release the title until they are paid. But the buyer won't pay unless I have the title in hand. How do I break this cycle?

Public Comments

1. would the buyer go to the bank with you and satify the lein to the bank, then pay you the difference?
2. you have to pay it off first. if you are a home owner, you could take a home equity loan, pay off the car, then immediately pay off the new loan with the money you go. you could technically get the lien holder to issue you power of attorney to sell the car. good luck with that.
3. Yeah, this question gets asked here about a dozen times a day. Both you and the buyer go to your bank. He writes a check to the bank, the bank gives him the title right then, or agrees to send it directly to him. If the selling price is more than the loan balance, the buyer writes one check to the bank to pay off the loan, and another check to you for the remainder. If the selling price is less than the loan balance, the buyer writes a check to the bank and you write another check for the remainder of the loan balance.
4. If you sell your car to a private party that the bank still owns, you need to know what your pay off is, and then use a keely blue book to find out the most you can get for you car or truck. It might be possible that you have negative equity and won't get the complete pay off on your car. If thats the case, the buyer will pay off your lein to your bank and you sign the title over. Good Luck
5. If you both cannot go to the bank (or lender) at the same time to do the paperwork, you need to use an Escrow Service. That's how large monetary transactions are done (homes, businesses, cars, etc). The Escrow Company takes the money from the buyer, pays off the bank, and then transfers the title to the buyer. Otherwise, buyer and you go to bank and sit down with a bank person. Buyer sits there with you and then forks over the cash, which is given to the banker. Banker then takes a receipt and hands you a 'release of lien' (it will take you several days to get the title from the bank, no doubt) which you can use to tranfser the title..... If you have enough money to pay off car, then YOU pay off car, and turn around and sell it to buyer. Or just call the bank or credit union that has the note on your car.