I know this is a very common question, but I usually either sell a car I have paid off or have traded in. If I sell to a private party and still owe the bank, how dose one handle the sales transaction so that the bank gets paid and the title gets transfered? Some sites say only take a cashiers check while othese warn that they can be a scam. Some sites recomend escrow accounts while other sites say they are scams as well. I am confused.

What is the typical way to handle a sale like this? I am assuming the buyer would not feel comfortable handing over a check without the pink slip.

 

I've never done it before but I am assuming you could call the bank with the buyer and let them know you are sending the payment and they should send it to the buyer once its been paid off?

I would suggest the buyer send the money directly to the bank and you do the same. Then the bill of sale of course.

 

Typically... the best way to handle this is, by asking the buyer to give you a certified check... the check will be in the banks name and not yours... the buyer is paying of the loan really.

now if you owe anything in addition to the amount the buyer is paying then you need to provide a check for the difference as well.

some banks issue you the title on the spot upon receiving the payment (which is what happened to me). The buyer and me went to the bank together... my bank called the buyers bank to verify the a/c and the available funds... once satisfied they gave me back my title within 1/2 hr. I transferred the title to the buyer in the bank itself and gave him the keys to the car.

some banks take 3-5 business days to process the transaction (basically they want the funds transfered in their account) before they issue the title and then whatever times it takes in the mail.

remember the title will be given back to you and not to the buyer. you have to then sign off the title and give it to the buyer.

you have to assure the buyer of the process and provide a surity... transactions like this are common.

 

I actualy have some equity in the car compaired to what I owe. Can I have the buyer cut 2 checks, one to the bank and the remainder to me personally? Would that be strange?

 

Aah... you are one of the lucky few to be owing less than the value of the car. I had that in my case as well... but lucky for me the bank I took the loan was the institution I bank with ... so the extra just went into my savings a/c after paying off the loan. You can do the same if you fall in my category.

Else, ask your bank ... that if you payoff more than whats needed, will they send you a check with the difference and the title together??