How to Trade in a Car That is Not Paid Off

2023 Honda Pilot

Louisville drivers are likely aware that you can trade your existing vehicle in at the dealership for another vehicle or for cash. While the trade-in process is simple when the vehicle is fully paid off, you’ll have to consider your options more carefully if your car isn’t paid off. If you don’t know how to trade in a car that is not paid off, Fisher Honda is here to help! We can assist Louisville in navigating the world of automotive finance in an easily understandable way. Read this guide, then come to Boulder to chat with our sales team!

The Difference Between Positive or Negative Equity

To get the proper context on how to trade in a car that’s not paid off, you’ll first have to determine whether you have positive or negative equity. Here’s a quick primer on the difference between the two:


  • Positive equity: your car is worth more than what you still owe
  • Negative equity: your car is worth less than what you still owe 


If you’re looking for facts on how to trade in a car you still owe on, determining your equity is crucial. Use a tool like Kelley Blue Book® to determine how much your car is worth, then look at trade-in offers to get a more hard and fast estimate of your car’s value. If the offer is less than the amount you owe, you have negative equity. If you have more value than your loan balance, you have positive equity.


If you have positive equity, you’re in the best position. You can trade in your Broomfield car without owing anything. You will even have some money left over to go toward your next car! However, if you have negative equity, there are some questions you’ll have to answer.

Trading in a Car When You Have Negative Equity

If you’re a Longmont driver who has negative equity, and you’re wondering how to trade in a car you still owe on, consider these options:


  • Make up the difference you still owe after accounting for the trade-in price. This is the first and easiest option. While not everyone has the spare cash to do this, if this option is available to you, it’s the best way to trade in a car with negative equity.
  • Another option is to transfer the amount you still owe over to a new loan. This is what most people choose. However, this will have the side effect of increasing your monthly payment. In addition, you’ll be paying off a car that’s no longer in your possession. If you can’t keep up with car payments, and you want to downgrade, this might be your best bet.


We’ve shown you how to trade in a car you still owe on when you have negative equity. If you have further questions, Fisher Honda would love to answer them.

Learn More About How to Trade in a Car That Is Not Paid Off With Fisher Honda 

Are you looking to trade your vehicle in but still have a current loan? You don’t have to worry when you talk to the experts at Fisher Honda. Our finance specialists are ready to help you make the right choice. Contact us today to get in touch with our team or apply for financing to get pre-approved for your next loan.

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