Can a Car Be Transferred If the Mortgage Is Not Fully Paid Off?

[LaAndres]

A car purchased through installment loans cannot be transferred if the loan is not fully paid off, as the ownership of the vehicle does not yet belong to the buyer. A car with an outstanding loan is essentially mortgaged to the lending institution, and any transfer of the vehicle requires the consent of the creditor. Vehicles still under loan repayment cannot be traded or sold, and thus cannot be transferred. Article 49 of the "Guaranty Law" states that during the mortgage period, if the mortgagor intends to transfer a registered mortgaged property, they must notify the mortgagee and inform the transferee that the property is mortgaged. If the mortgagor fails to notify the mortgagee or inform the transferee, the transfer is invalid. If the transfer price of the mortgaged property is significantly lower than its value, the mortgagee may demand the mortgagor to provide additional security. If the mortgagor refuses, the transfer cannot proceed. The proceeds from the transfer of the mortgaged property must be used to repay the secured debt in advance or be deposited with a third party agreed upon with the mortgagee. Any surplus belongs to the mortgagor, while any shortfall must be covered by the debtor.