Vehicle restrictions
CarMax buys vehicles that are not paid off. To sell a car you still owe money on to the retailer, you must provide loan information so CarMax can pay off the lender. If you owe more than your offer, you will need to cover the difference.
Legally, you can sell the car. You need to pay off the loan or the bank won't give the title to the buyer. If you do not pay off the loan pronto, you are committing fraud and theft, with both the bank and the buyer coming after you for restitution, Legally, you can let the car get repossessed.
Yes, we do. In most cases, the selling process is very similar to any other financed car.
You ask your bank for a payoff sheet. That's your remaining balance. Whoever buys the car has to write the bank a check for that amount and the remaining balance to you. Once they write the check to the bank you request for them to release the lien to the new owner.
Note: If you're selling a car with an active loan, you're still the one responsible for paying it off, so the remaining balance on the loan will likely be subtracted from the price the dealer offers you. So if you owe more than what the dealer offers, you'll need to pay the difference to the lienholder.
One way to get out of a car loan is to sell the vehicle privately. If you're not upside down on the loan, meaning the car is more valuable than what you currently owe on it, you can use the proceeds of the sale to pay off the current loan in full. Another term for an upside-down car loan is negative equity.
We check every car's history to rule out any with flood damage, frame damage, outstanding liens, or salvage history. Any car that can't meet those condition standards gets sold at auction — not to you. Cars must also pass a 125+ point inspection and undergo a detailed reconditioning process to be sold at CarMax.
Negotiate and finalize: You can negotiate with the dealer on the price of the new car, and on how much they will offer you for your trade-in. If the trade-in offer won't be enough to pay off your current loan, the dealer or lender may roll the difference into a new loan.
Sell your vehicle.
Another option is to sell your vehicle, but first, find out how much you owe on the auto loan and the approximate market value of your vehicle. If you owe less than the value of the vehicle, you can sell it and use the proceeds to pay off the loan.
The answer to the query depends on whether you are the borrower or the lender of the repossessed car. If you are the borrower, you cannot sell a repossessed car because you no longer own it. If you are the lender, you can sell a repossessed car to cover the debt or keep it for yourself.
If your vehicle is worth more than you owe, we'll pay you the difference, or you can apply it toward the purchase of your next vehicle from Carvana. Until the sale of your vehicle to Carvana is completed, please continue to make your normal loan payments to avoid late payment penalties with your lender.
If we receive a payment near the end of the grace period, allow 1-2 business days for the payment to be processed and credited to your account. If, in such a case, a late charge is assessed, it will automatically be removed upon our processing and crediting your payment.
If you have negative equity, what you owe is more than what your car is worth. You can still trade in your car with negative equity, but you'll still be responsible for paying off the difference. Your dealer will typically roll your remaining balance into a new loan which makes your monthly payments greater.
CarMax stands out because they do not use GPS trackers for repossession on their cars. Unlike many car dealers, CarMax avoids installing any tracking devices on the vehicles they sell.
The car is collateral for the loan, and until the loan is fully repaid, the lender holds a lien on the vehicle. So, can you sell your car back to the dealership if it's still under finance? Yes, you can.
How Much Negative Equity Is Too Much on a Car? The maximum negative equity that can be transferred to your new car is around 125% . It means your loan value should not be more than 125% of your car's actual worth. If it is more than 125% then your next car's loan would not be approved.
Your total-loss insurance payout will be for your car's ACV only. If you owe more money on your loan than your insurance settlement, you are still responsible for paying the difference. Most insurers offer "gap" coverage, which pays the difference between your car's AVC and your loan balance.
You need to pay off the loan in full. If you sell to CarMax, they will make a 7 day offer. Of less than you owe, you need to make up the full difference in cash or certified funds. It's not a repossession, you're just selling the car.
You will leave with payment in hand the same day you sell us your car.
In some cases, we may need to test drive your car to check on certain mechanical conditions.
Contact Your Lender
Contact your lender as soon as you know you won't be able to make payments. Many lenders are willing to work with borrowers to avoid vehicle repossession and get their payments under control. The sooner you get in touch, the more options your lender may be able to offer.
Voluntary Repossession
This involves surrendering the car to the lender. They then sell the car and use the proceeds to pay off the remaining loan balance. We can negotiate with the lender on your behalf to minimize damage to your credit score during this process.
The best way to handle selling a financed car to a private buyer is to conduct the transaction at your lending institution. Getting your lender involved in the process makes the whole thing more formal and legitimate.