Category Archives: How To Guide

Lease agreement is shown on a photo using the text

Lease it to Us: Ways of Getting out of a Car Lease Early

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Leasing a car can give you flexibility and lower monthly payments, but if life circumstances require you to end your lease early, it can be tough and pricey. This guide outlines the various leasing options available, detailing their pros and cons to assist you in making a well-informed decision.

Understanding A Car Lease

Before discussing end strategies, it’s important to know what a car lease involves. Leasing is like renting a car for a set time, usually two to five years. You cover the vehicle’s depreciation during the lease, plus interest and fees. Leasing often costs less upfront and monthly than buying, but you don’t gain ownership of the car.

4 Ways to End a Car Lease Early

  1. Return the Car and End the Lease

Returning the car to the leasing company and paying all related fees is a straightforward option. It ends the lease obligations quickly but can be very costly due to fees and remaining payments. It might also affect your credit score if payments are missed.

  1. Trade the Car for a New Lease

Certain dealerships allow you to swap your leased vehicle for a new lease. This option lets you enjoy a new car while potentially lowering fees. However, be aware that early termination fees may still apply, and you’ll need to sign a new lease agreement.

  1. Transfer the Lease

Transferring your lease to another person means they take over the remaining payments. This can be cheaper if the leasing company allows it, avoiding termination fees. However, not all leases allow transfers, and you might be responsible if the new lessee defaults.

  1. Sell the Car

You can buy out your lease and sell the car to someone else, possibly recovering some costs. If the car’s market value is higher than its residual value, you might make a profit. However, you must buy out the lease first, and selling may not cover all costs depending on market conditions.

The Cost of Early Lease Termination and Alternatives

Ending a lease early can be pricey, as you might pay the difference between the lease balance and the car’s value, plus any fees in your contract. Check your lease agreement for details. If these options don’t work, try negotiating with your leasing company. They might offer other solutions or payment plans, and short-term lease extensions could provide temporary relief.

Making the Right Choice

Before choosing how to end your lease, assess your financial situation, the lease terms, and each option’s impact. Some strategies may have higher upfront costs but save money and stress over time. By understanding these methods, you’re better prepared to choose a strategy that fits your needs.

Are you ready to set up your lease transfer or sale today to reduce future financial burdens? Visit Charge-A-Car for help making the right choice when it comes to ending your lease. Our financing department will be delighted to help you exit your current lease and get into a vehicle you’ll love. Our team looks forward to seeing you soon!

Car keys and money on table with man using calculator. Buyer counting savings and gas cost or salesman calculating sales price, vehicle value or road taxes.

How to Sell Your Car with a Loan Payoff You Still Owe

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Selling a car that still has a payoff can feel tricky, but it’s possible with some know-how. Whether you want to upgrade, lower your bills, or just want a change, this guide will help you understand how to sell your car smoothly while you still owe money.

Understanding the Basics of Selling with a Payoff

When you have a car loan, the lender owns part of your car until you pay it off. This means you need to settle or transfer the loan before the new owner can take the car. While this adds some steps, it shouldn’t stop you from selling.

What to Consider Before Selling

Before you sell, think about:

  • Loan Balance vs. Car Value: Check how much you owe on the loan compared to what your car is worth.
  • Financial Goals: Make sure selling fits your financial plans, especially if you owe more than the car is worth.
  • Lender’s Policies: Ask your lender what their rules are for selling the car, including any fees.

How to Sell a Car with a Loan Payoff

Step 1: Find Out Your Car’s Value

First, check how much your car is worth using trusted sites like Kelley Blue Book or Edmunds. This will help you set a fair price and see if you have positive or negative equity. Selling your car privately usually gets you a better price than trading it in at a dealership, so compare both options.

Step 2: Get the Loan Payoff Amount

Contact your lender to find out how much you owe. This is called the payoff amount and might be different from your remaining loan balance due to interest. Ask if there are any penalties for paying off the loan early.

Step 3: Know Your Car’s Equity

To figure out your car’s equity, there are two things to know: Positive Equity and Negative Equity. Positive Equity means your car is worth more than what you owe, so you’ll get money from the sale after paying off the loan. Negative Equity means you owe more than the car is worth, so you’ll need to pay the difference.

Step 4: Talk to Your Lender

Before you sell, talk to your lender. They may have specific instructions or deals with car dealers to help with the sale. They also hold the car title, so you’ll need their help to transfer it to the new owner.

What to Do If You Have Negative Equity

If you owe more than your car is worth, you have a few options. Refinancing your loan could lower your monthly payments and help you build equity faster. A personal loan might help cover the gap if you decide to sell but be careful of high interest rates. Lastly, you could use savings to pay the difference and avoid more debt.

Make Selling Your Car Easy

Selling a car with an outstanding loan involves some extra steps, but with planning and research, it’s manageable. At Charge-A-Car we can help you navigate through the finances of the car selling process today. Whether you have an outstanding payoff, need to sell your car, or want to trade up, visit us today, and let’s explore your options to ensure you get the best deal!

Ready to sell your car? Explore your options and start planning today!

Classic white piggy bank floating in water.

Navigating Negative Equity Your Car and Your Finances

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Dealing with a negative equity vehicle can be a stressful experience, especially if you’re looking to trade in or sell your car. But don’t worry—you’re not alone, and there are steps you can take to manage this situation effectively.

What is Negative Equity?

Negative equity, often called an ‘upside-down’ loan, occurs when you owe more on your car loan than the vehicle is worth. This situation can happen for several reasons:

  • Depreciation over time
  • Accidents or repairs that reduce the vehicle’s value
  • High-interest rates or long-term loans

When you have negative equity, selling or trading in your car can become more complicated.

How Negative Equity Happens

It can be surprisingly easy to end up in a bad situation ‘upside-down’ car loan. No-money-down purchases mean your loan not only involves the vehicle, but also the taxes, licensing, registration, and fees, making your financed amount larger than your car’s value. Long-term loans and rapid car depreciation due to usage and accidents are common culprits that lead to being in a tight, negative equity situation.

Options for Dealing with Negative Equity

1. Pay the Difference Upfront

One straightforward solution is to pay the difference between your car’s value and your loan balance out of pocket. This approach allows you to start fresh with a new car loan or lease without carrying forward any debt.

2. Refinance Your Loan

You may be able to refinance your current loan to a lower interest rate or shorter term, reducing your monthly payments. However, this option typically requires good credit and may not be available to everyone.

3. Keep the Car and Pay Down the Loan

If trading in or selling the car isn’t urgent, consider keeping your vehicle and making extra payments to reduce the loan balance faster. This method can help you reach positive equity more quickly without the need to take on additional debt.

4. Sell the Car Privately

Selling your car privately could fetch a higher price compared to a trade-in. While this might not get rid of your negative equity entirely, it could reduce the amount you owe significantly.

Get Help with Your Negative Equity Today!

Negative equity on your car loan doesn’t have to be a financial nightmare. By understanding your options and taking strategic steps, you can effectively manage this situation and move towards a more secure financial future.

Ready to take control of your finances? Schedule a consultation with our financing department today and let us help you get out of a bad situation and into a car you love! Visit Charge-A-Car in Aurora to regain your freedom financially and on the road!

A Guide to Organizing Your Car’s Paperwork

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As winter retreats here in Aurora, we look ahead to the spring and one of its inaugural activities: spring cleaning. Much more than dusting windowsills and scrubbing sinks, spring cleaning is an opportunity to take inventory of your life, a conscious un-cluttering of both your personal space and your mind as you prepare for the year ahead. 

Part of this process includes properly organizing your paperwork. As with anything else in modern life, car ownership involves a great deal of documentation. It can be overwhelming to keep everything straight – but simplifying your auto needs is what we do here at Charge-A-Car, where you can purchase and finance your next car in the same afternoon! 

What You Should Have 

License & Registration: If you’ve ever seen someone pulled over in a movie, chances are you know to always have your license and registration handy while driving. Make sure your registration is up to date; if the expiration date is near, take the necessary steps to renew it. It should then be signed and stored somewhere in your vehicle, such as the glove compartment or beneath the central console. As for your driver’s license, hopefully it’s already safely stored away in your purse or wallet – otherwise, your spring cleaning to-do list just got longer. 

Proof of Insurance: Owning vehicle insurance is a requirement for every licensed driver. It’s another item you’ll want to keep in your car in the event that you’re pulled over. You should also have it on hand in case of an accident, so that you can exchange insurance information with the other driver. At the very least, keep a photo of your insurance card available on your phone.

Vehicle Title: Unlike your registration and insurance cards, the title to your car needs more protection than your glove compartment can offer. This piece of paper is the only proof of ownership of your vehicle that you have, making it immensely valuable. Keep your title stored away in a secure place you’ll remember, such as a home safe. 

Service & Maintenance Records: Though documenting your vehicle’s history of service and maintenance isn’t a requirement, it’s still a good idea. It will keep track of what services were performed when, so that you’ll know the next time you’re due for, say, an oil change. More importantly, keeping detailed records of your car’s history will serve you well when it comes time to sell. 

Keeping Your Paperwork Organized 

While your registration and insurance should be kept inside the vehicle, we recommend keeping all other paperwork together. A safe space in your home is preferable, as it allows you regular access. This includes the title and service records, but also any other relevant paperwork, such as warranty and emissions test documentation. If necessary, divide and categorize accordingly, i.e. keep your insurance payments bundled together. Make sure you have the proper storage space to accommodate everything. 

In today’s digital world, it’s important to back everything up. Make physical copies of your paperwork if that’s your preference, but also consider uploading your files to cloud storage. By digitizing, you’re ensuring your files will remain available to the world – even when you’re having difficulty tracking down their physical counterparts. 

One Last Step 

Once you’ve collected and organized all relevant paperwork, your future suddenly becomes much more open. For starters, you now have everything you need to trade in your ride today! Any vehicle in our extensive inventory could be yours when you schedule your test drive at Charge-A-Car, Aurora’s number one spot for used car shopping.