Trading in a car that is still being paid off

tke344 · 03-31-2009, 09:00 AM

I'm curious how this is handled... A little over a year ago I purchased a pre-owned 06 G35c. I financed the car at 5.9% and have a little less than 4 years left of payments. I'm not very happy with the car and was planning on trading it in for a CPO 07 e92 later this year. I got a good price on the G and as it stands the trade in value is approximately what I owe on the loan but I'm prepared to make up any difference with cash. If I were to go to BMW financial with the intent of trading in my car, would they essentially give me a check for the trade in and I simply finance the BMW or is it more complicated?

RedDinan335i · 03-31-2009, 09:20 AM

You simply bring your copy of the title which should include the lein information and negotiate the trade in price. Hopefully you come out on the + side and don't have to fork over extra cash. The dealer will pay off the outstanding balance and you sign the title over to them. Then you negotiate the purchase price on the new car and your financing will include your new ride +/- trade in balance and you're good to go.

ex.
you owe 20k
your trade = 21k
new car = 28k - 1k = 27k
finance 27k
you also pay taxes, title and licensing

tke344 · 03-31-2009, 09:40 AM

Thats exactly what I wanted to hear, thanks. I guess the real downside is that I'll be paying taxes once again but I'll try to hold out for 0.9%

RedDinan335i · 03-31-2009, 09:46 AM

Yes, but taxes will be calculated on purchase price - trade in price. So hopefully they won't be too bad.

RMA · 03-31-2009, 09:59 AM

Yes you would save on tax. Lets just say the CPO E92 sells at $34k & your trade in value is $28k. So the taxable difference would obviously be $6k (plus your EXISTING balance owed on your trade in) even though BMW would be paying off that loan it would just simply be rolled into your new car purchase. Hope this helps

tke344 · 03-31-2009, 10:17 AM

Oh, thats excellent news, I was expecting to pay tax on the entire purchase price. Makes sense when you think about it... Thanks again

igorek82 · 03-31-2009, 01:29 PM

Quote:

Originally Posted by tke344

Oh, thats excellent news, I was expecting to pay tax on the entire purchase price. Makes sense when you think about it... Thanks again

In my humble experience, you always lose more by trading the car in... even considering taxes.. might want to consider selling it by yourself...

adr1974 · 04-01-2009, 01:24 PM

Hope you guys will excuse my rookie question. Do dealers ever take more in trade but less off msrp? For example:

Owe: 48
Trade: 45
MSRP: 53
Invoice 48

If a normal deal were to occur at invoice + 500, would the dealer do trade at 48 and sell you a new car at 51,500?

03-31-2009, 09:00 AM	#1
tke344 Lieutenant 38 Rep 463 Posts Drives: f15 X5 50i Join Date: Jan 2009 Location: Charlotte iTrader: (1)	Trading in a car that is still being paid off - How does it work? I'm curious how this is handled... A little over a year ago I purchased a pre-owned 06 G35c. I financed the car at 5.9% and have a little less than 4 years left of payments. I'm not very happy with the car and was planning on trading it in for a CPO 07 e92 later this year. I got a good price on the G and as it stands the trade in value is approximately what I owe on the loan but I'm prepared to make up any difference with cash. If I were to go to BMW financial with the intent of trading in my car, would they essentially give me a check for the trade in and I simply finance the BMW or is it more complicated?
	Appreciate 0 Tweet Quote

03-31-2009, 09:20 AM	#2
RedDinan335i Private First Class 1 Rep 102 Posts Drives: Red 335i Coupe Join Date: Feb 2009 Location: St. Louis iTrader: (1)	You simply bring your copy of the title which should include the lein information and negotiate the trade in price. Hopefully you come out on the + side and don't have to fork over extra cash. The dealer will pay off the outstanding balance and you sign the title over to them. Then you negotiate the purchase price on the new car and your financing will include your new ride +/- trade in balance and you're good to go. ex. you owe 20k your trade = 21k new car = 28k - 1k = 27k finance 27k you also pay taxes, title and licensing __________________ Mods: Dinan Stage2 Dinan Exhaust
	Appreciate 0 Quote

03-31-2009, 09:40 AM	#3
tke344 Lieutenant 38 Rep 463 Posts Drives: f15 X5 50i Join Date: Jan 2009 Location: Charlotte iTrader: (1)	Thats exactly what I wanted to hear, thanks. I guess the real downside is that I'll be paying taxes once again but I'll try to hold out for 0.9%
	Appreciate 0 Quote

03-31-2009, 09:46 AM	#4
RedDinan335i Private First Class 1 Rep 102 Posts Drives: Red 335i Coupe Join Date: Feb 2009 Location: St. Louis iTrader: (1)	Yes, but taxes will be calculated on purchase price - trade in price. So hopefully they won't be too bad. __________________ Mods: Dinan Stage2 Dinan Exhaust
	Appreciate 0 Quote

03-31-2009, 09:59 AM	#5
RMA Major 38 Rep 1,015 Posts Drives: 2009 135i M sport coupe Join Date: Jul 2008 Location: Tampa, Fl iTrader: (6) Garage List 2009 135i M sport c ... [0.00]	Yes you would save on tax. Lets just say the CPO E92 sells at $34k & your trade in value is $28k. So the taxable difference would obviously be $6k (plus your EXISTING balance owed on your trade in) even though BMW would be paying off that loan it would just simply be rolled into your new car purchase. Hope this helps __________________
	Appreciate 0 Quote

03-31-2009, 10:17 AM	#6
tke344 Lieutenant 38 Rep 463 Posts Drives: f15 X5 50i Join Date: Jan 2009 Location: Charlotte iTrader: (1)	Oh, thats excellent news, I was expecting to pay tax on the entire purchase price. Makes sense when you think about it... Thanks again
	Appreciate 0 Quote

04-01-2009, 01:24 PM	#8
adr1974 Lieutenant 128 Rep 415 Posts Drives: 2021 X5 xDrive 40i Join Date: Jun 2008 Location: Maryland iTrader: (0)	Hope you guys will excuse my rookie question. Do dealers ever take more in trade but less off msrp? For example: Owe: 48 Trade: 45 MSRP: 53 Invoice 48 If a normal deal were to occur at invoice + 500, would the dealer do trade at 48 and sell you a new car at 51,500?
	Appreciate 0 Quote