I currently own an '06 Silver tC and am considering trading it for a local car...'93 Blue RX7, perfect condition and new engine parts. But I'm not sure how the trading process will go/what needs to be done, since I'm paying a monthly bill for my tC, I'm not sure what happens with that. So if anyone with any experience or knows what happens with a complete trading process, would you mind posting here, I'm on a press to get to work so I didn't have enough time to search to see if there was any other posts about trading cars. If there is just link them up here and I'll see them later. But if people know what I need to do to prepare for a trade like that just let me know.

 

You could go back to your dealer and ask for an estimate.

 

I work for GE Retail Sales finance so deal with this all the time. It sounds like you are going to give this guy your Scion tC and he is going to give you his RX-7. It also sounds like you are making a monthly payment so you don't actually own the car and don't posses the title. If you did then a trade would be as simple as exchanging keys and pink slips. When you took your loan out, your finance company made a calculated decision to grant you credit based off of your financial records and also took into accound the item you were going to purchase, you cannot simply take the RX-7 and expect your finance company to extend you the same credit for that particular piece of collateral. Basically you will need to satisfy (pay off) your original loan and then qualify for a new loan on the RX-7. Be aware that it will be hard to get financed for a car that old. Also, and this has nothing to do with financing an RX-7, but those cars have tons of problems. Go pick up the most recent edition of Road and Track and you will see what I am talking about. Those engines need to be totally rebuild every 50-60k and use a quart of oil every 3k miles. There are tons of other problems with those cars. If you are looking for reliablity you should stay away from the RX-7. Well anyway, you cannot simply trade.

 

Alright well this post helped me make my decision...It's a sad one, but I guess it's for the best. Thanks.

 

I have my title, and I'm making monthly payments. I'm pretty sure that only applies for leasing(they keep the title). However, you are right, technically, the financial institution, from whom you are borrowing money, owns the car until it's paid off...TFS in my case. To the OP, good luck.

 

If you're making payments, you don't have the title unless somebody really screwed up. Some states like Maryland have a two part title and the owner gets one part and the bank gets the other. You don't get both until you pay off the car. Most states just have a single title.

In order to trade, you have to get your loan paid off. If the car is at a dealer, that's fairly easy. They will finance the new car and take yours in trade. They will make the payoff to your current lender as part of the transaction.

If you're buying/trading with an individual, it gets a lot more tricky. It really has to happen as two different transactions. The other guy buys your car. He gives you a check which you take to your lender to pay off the loan and they will give you the title. You give the title to the new guy or to his bank if he is financing it. Then, you arrange for a loan to buy the Mazda. Give the seller the loan proceeds check and he will give you the title which has to be given to your bank.

What you can not do is to just swap cars and keep paying your current loan. That is bank fraud. The bank gave you a loan against specific collateral (the Scion) and if you no longer possess that collateral, its a big problem. You can't just substitute collateral. The bank may or may not consider the Mazda to be as good of collateral as the Scoin.

 

I bought my car, I'm not leasing it. My dad's Escape is the same way. We have our titles. My mom doesn't have the title for her Camry because it's a lease, and the car is never yours. Maybe Michigan is different than everywhere else...

 

Does your title have a lien recorded to it? If not, then you own the car free and clear. Otherwise the bank has to be paid off and you can see my other comments above.

We've had a few situations where a customer was sent a title in error before it was paid off. In VA and most other states the title is proof that you own the car free of liens and encumberances. If you have this proof, you can do whatever you want and the bank has no recourse. I'm sure MI has some form of protection for the banks such as a lien recording on the title.

 

yeah, there is a lein on the title until it's paid off, but I do have the title itself.

 

Alright, well thanks again guys, once again it really helped.

 

I live in florida and I have the title as well... However like cliffy1 explained I have a lein recorded on the title, therefore I do not own the car free and clear.