Car Finance Part Exchange Calculator

Part exchanging a car that's under finance isn’t just a straightforward trade.

Depending on the type of finance you have and the lenders terms, it may not even be possible to part exchange a financed car.

From understanding if it's even possible to figuring out the financial implications, read on to discover everything you need to know.👍😊

Can I Part Exchange My Financed Car?

It is possible to part exchange a car that is still under finance, but there are specific considerations to be aware of.

Firstly, the outstanding finance on the vehicle must be settled as part of the part exchange process.

This means if the car's value is more than the remaining finance owed, the excess can be put towards your next vehicle.

However, if you owe more on the finance than the car is worth (known as negative equity), you'll need to cover this difference.

It's important to check any restrictions in your finance agreement that may affect your ability to part exchange.

Some agreements may have early repayment fees or other conditions you need to know about.

So, check your agreement to see what rules and restrictions may apply. You can also calculate the cost of early settlement to see if it’s worth it.

Calculating the Cost of Car Finance Part Exchange

Understanding how much it will cost to part exchange a financed car is essential.

This involves calculating the car's current value and comparing it against the outstanding balance on your finance agreement.

You can find the current value of your car through online valuation tools or by getting a valuation from a dealership.

Once you know the car's value, subtract the remaining finance owed to understand if you're in a position of positive or negative equity.

Positive equity means the car is worth more than the finance owed, which is an ideal situation for part exchange.

Negative equity, where you owe more than the car’s worth, requires careful consideration as you will need to cover the shortfall.

Pros and Cons of Part Exchanging a Car on Finance

Part exchanging offers a streamlined way to move from your current car to a new one. It can also potentially save you money.

However, like any financial decision, it comes with its own set of advantages and drawbacks.

Below, we break down the pros and cons of part exchanging a financed car. This should help you understand what to expect and how it could affect your financial situation.

Pros of Part Exchanging a Car on Finance:

• Quick and convenient way to upgrade or change vehicles
• Can consolidate the settlement of existing finance and the cost of a new car
• Potential positive equity can contribute towards the next vehicle

Cons of Part Exchanging a Financed Car:

• Risk of negative equity, requiring additional payments
• May incur early settlement fees from your lender
• Limited to the valuation offered by the part exchange dealer

How to Part Exchange a Car on Finance

To part exchange a financed car, start by getting a settlement figure from your lender. This is the amount needed to pay off the current loan.

Next, get your car valued to see how much it’s worth against the settlement figure. This can be done through online valuation tools or at a dealership.

Once you have these figures, you can approach a dealer to discuss part exchange. They will consider the valuation of your car against the settlement figure.

If there's positive equity, it can go towards your next car.

If there's negative equity, you'll need to decide whether to cover this cost upfront or incorporate it into the next finance agreement.

Refinancing Your Car Loan with Carmoola

Before deciding on part exchange, consider refinancing your car loan as an alternative.🤔

Refinancing can offer better terms or a lower interest rate, which may make more financial sense than part exchanging; especially if you're facing negative equity.

At Carmoola, we offer competitive refinancing rates that can potentially reduce your monthly payments or overall loan cost.

Refinancing with us is fast and simple, and it could save you a lot of money compared to part exchanging.

We also provide great value hire purchase deals if you do decide to part exchange.😘🚗

Read more part exchanging or refinancing your car loan:

• What are the Benefits of Refinancing Your Car Loan?
• Can I Reduce My Car Loan Repayments?
• Can I Transfer My Car Loan to Another Person?