Can You Trade In a Financed Car?

Can you trade in a financed car in Columbia? Yes. But, there are a few things to keep in mind when trading in a financed car. Most notably, you’ll still need to pay off the balance. Learn how trading in a financed car works, and explore your options with the finance team at Honda of Columbia!

How Does Trading in a Financed Car Work?

When you trade in a financed car for lease or loan in Irmo, you’ll need to do a little research ahead of time for the best results.

• Find the remaining balance on your current loan. You can contact the lender or look at your last monthly statement.
• Find the current value of your vehicle. You can use a Value Your Tool calculator from Honda of Columbia or use a service like Kelley Blue Book. These tools will offer a rough estimate based on different factors, but the real assessment must be performed in person.
• If your current loan balance is less than the trade-in offer on your vehicle, you’ll have money leftover to apply to your new vehicle. So if you owe $5,000, but the dealership offers $6,000 on your car, you can pay your loan off and apply $1,000 to your new car.
• If your current loan balance is more than the trade-in offer on your vehicle, you’ll still owe money on your old car – which is called “negative equity”. You have two choices: paying the remaining balance or rolling over the loan.

What is “Rolling Over” a Loan?

“Rolling over” the loan means you let the dealership pay off your remaining loan balance. Does this mean you’re off the hook on the old balance? No. The amount simply gets added to your new car loan balance. This means you’ll pay off the old loan and the new loan at the same time.

Finance Your Next Car with Honda of Columbia

Now you know the basics of how trading in a financed car works, but if you still have questions, Honda of Columbia is here to help. Contact us to see how trading in a financed car can benefit you, and stop by Lexington for more car buying tips. We’re only a short trip from West Columbia, so don’t hesitate to reach out!