The Safe Way to Sell a Car With Installment Payments

Some auto owners decide to trade in their old vehicles when buying a new one; but to get the most money for their vehicle, other owners decide to sell their car privately. Several methods can help sell a car privately, and when someone interested in the vehicle can't qualify for a loan or doesn't have the cash to pay outright, you may agree to accept installment payments for the vehicles.

Instructions

1

Know the fair market value by visiting Kelley Blue Book online. This website provides information on prices for private sales and trade-in values based on the make, model and condition of the automobile.

2

Place ads to find a buyer for your car. After deciding a price for the car, advertise for buyers with classified ads in the automotive section of the newspaper or put a "for sale" sign inside the window of the car. Include your telephone number, make, model, price and overall condition of the vehicle. Mention your willingness to accept installment payments in the car ad.

3

Negotiate the price and terms. Meet with potential buyers to agree on a sale price; and once you've decided in a price, discuss terms for the installment loan. In other words, find out how much the buyer will pay each month, and for how long.

4

Write the contract and include information regarding the installment payments. Put everything in writing before giving the buyer possession of the automobile. The contract need include the name of both parties, the sale price, the monthly payment, due dates, penalties for missed payments and installment term. Include a space for both parties to sign, and have the document notarized. Give the buyer a copy, and keep a copy for yourself.

5

Complete the bill of sale to finalize the deal. Transfer ownership by completing the bill of sale located on the back of the car's title. Make a copy for yourself and the give the buyer the original copy. Indicate terms of the installment agreement on the bill of sale.

6

Send a lien release. Once the buyer makes the final installment payment, present them with a lien release form, which indicates that they satisfied the term of the agreement. Download forms from the Department of Motor Vehicle's Official website.