Can a Mortgaged Car Be Sold?
2 Answers
A mortgaged car cannot be transferred because the vehicle has already been mortgaged, and the ownership temporarily does not belong to the owner. Therefore, the owner does not have the right to transfer a car that does not belong to them to someone else. The mortgage must be fully repaid and the lien released before the transfer can be processed. Additional details are as follows: Fully Paid Mortgaged Car: A fully paid mortgaged car must meet one of the following conditions: the car was purchased with a one-time payment; or the car was purchased through installment payments, the payments have been completed, but the owner is unwilling or unable to repay the financial company and does not cooperate with the transfer, leading the financial company to legally transfer the debt. Non-Fully Paid Mortgaged Car: A non-fully paid mortgaged car refers to a vehicle that is still under mortgage with the DMV and the bank when it is sold or similar actions occur.
Last year, I tried selling a used SUV that was still under a lien, and the experience was quite complicated. Initially, I thought I could just find a buyer directly, but later discovered the car still had an outstanding bank loan, meaning I either had to pay off the loan first or obtain a release letter from the bank to transfer ownership. The process was quite tedious—the bank required income verification and took several days to review, while the buyer was also concerned about potential default risks. I took it step by step, first assessing the car’s market value to ensure it could cover the remaining loan before proceeding with the sale. In the end, the sale went smoothly, though it took extra time to handle the paperwork. A word of advice: always check the loan status and consult professionals before selling a financed car to avoid pitfalls, especially avoiding private deals, which can easily lead to trouble.
