Can You Trade In a Car If You Are Still Making Payments?

Many car dealerships claim to offer top dollar for your trade-in when you're ready to upgrade, but the exact terms of a trade-in can be a bit confusing. For instance, when you're ready to buy a new car, you may wonder if you can trade in your older one even though you still have a running loan balance.

Trading in a Car

When you trade in a car you give the car dealer the vehicle in exchange for a quoted value that the dealership deducts from your new car purchase. The amount that a dealer offers is commonly less than what the car is worth on the private market, but it saves you time and the headaches of trying to sell it on your own. You can determine the estimated trade-in value for a car at the Kelley Blue Book website. However, the ultimate decision on what to offer for the car is up to the dealer.

What If You Still Owe ?

You can trade in a car if you still owe money on your current car loan. In this case, the dealer has to complete the extra step of paying off your lender before completing the sales transaction. The dealership simply deducts the leftover value (if any) after you pay off the existing car loan from your new car sale. So in short, the dealer's offer less the loan payoff balance is your credit toward the purchase.

Calculating New Transaction

It is sometimes confusing to understand how the dealer calculates your trade-in credit when determining your final amount due for the new car. The dealer takes the sales price you've negotiated for the new vehicle, deducts the trade-in estimate and then adds the loan payoff amount to determine your amount due. The dealer also includes financing costs (if you're seeking a new car loan), sales taxes and any applicable rebate offers into the equation.

Concerns

Though a car dealer may quote you at or above the Blue Book value of the car, that is no guarantee that it will be enough to satisfy the outstanding loan. If the loan payoff figure exceeds the amount of the trade-in offer, the dealership will commonly either try to roll the deficit over to your new loan or require you to pay the difference in cash. In this case, it is wise to consider trying to sell the car on your own to get a better price for the vehicle to payoff the loan and possibly have money left over.

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Does California's Lemon Law Apply to a Car Bought From a Tow Company?

In California, the Car Buyer's Bill of Rights covers new and used vehicles purchased from car dealers in California on or after July 1, 2006. It does not cover transactions between private parties and does not cover off-road vehicles and motorcycles. Tow truck companies may have to comply with the Car Buyer's Bill of Rights, but must comply with the two-day sales contract rescission laws if they are covered by them.

California's Lemon Law

The California lemon law requires both new- and used-car dealers to provide disclosures to car buyers. They must provide itemized financing disclosures and whether their vehicles come with warranties and insurance. They must also provide financial disclosures. The state's lemon law, or the Song-Beverly Consumer Warranty Act, requires dealers to offer trade-ins or replacement vehicles to consumers who purchased defective cars and request repairs within 18,000 miles or within 18 months of purchase.

Tow Companies

Since tow companies generally sell used cars, they are required to comply with the state's new-car laws. Dealers that sell used cars must provide itemized price statements that disclose their true costs for purchasing their vehicles. Tow companies are covered by the state's two-day rescission or cancellation law if they sell more than five vehicles annually. They must offer all buyers a right to purchase a cancellation option limited to $75 for vehicles that cost $5,000 or less; $150 for a car that costs between $5,001 and $10,000; and $250 for a car that costs $10,001 to $30,000. After $30,000, tow truck companies and used-car dealers can charge one percent of the vehicle's purchase price for the portion over $30,000 and up to $39,999.99. All figures are as of May 2011.

Exceptions

The two-day cancellation requirement does not apply to cars that retail at $40,000 or more, new cars or vehicles used commercially. Furthermore, it does not apply to recreational vehicles, motorcycles and off-road utility vehicles. Buyers who do not purchase the two-day cooling-off option are not entitled to refunds.

Buyers' Rights and Duties

Buyers who are covered by the cancellation option can return their cars by the end of the second day for a full refund. If they exercise their option, dealers and tow truck companies must offer a refund of the used-car purchase price, any trade-ins, registration and title fees, and taxes. Dealers and tow truck companies do not have to provide refunds of the price buyers paid to purchase the option. Furthermore, they may charge a nominal fee for restocking, but must reduce it by the fee buyers paid to purchase the cancellation option.

To exercise their legal rights under the state's cancellation law, car buyers cannot return their cars if they exceeded the mileage and use allowance required under the contract of at least 250 miles. They must bring all of their cancellation-option receipts, vehicle purchase receipts and contracts. They are not entitled to exercise their option to cancel their contracts if they subsequently placed liens on their vehicles, except for original finance liens.

Considerations

Since state laws can frequently change, do not use this information as a substitute for legal advice. Seek advice through an attorney licensed to practice law in your state.

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Facts About Financing a Car

Buying a new car generally requires having the financial condition to finance the vehicle. Most people don't walk around with thousands of dollars in their pocket or even in a bank account. Because of this, you need to understand how financing a car works and what is expected of you in the process. Financing facts not only make you a more educated consumer, but might also help you to get the most bang for your buck when you purchase a new vehicle.

Dealer Financing

Most auto dealerships have a financing department that works to obtain financing for your new car. However, this is not always the best deal you can get. You are allowed to get your own financing to purchase a vehicle. Shopping around might get you better loan terms than you might have gotten at the dealership. Always keep in mind that focusing on the monthly payment is not your only consideration, the interest rate matters just as much, which is why it pays to shop around. A dealer, while not obligated to, will generally accept financing if you've already obtained it yourself to buy the vehicle.

Lien Holder

Even though you are purchasing the vehicle and consider yourself to be its rightful owner, keep in mind that your lender has the lien on the car until it is paid in full. You cannot sell the car or get a loan against it without the approval of the title holder, which is the bank, finance company or creditor that extended the loan to you to purchase the vehicle. This is why, no matter how many payments you've made, the finance company can repossess your vehicle if you miss payments, even if you are nearing the end of your loan period.

Credit Insurance

A financing company or lender might ask that you buy credit insurance on your new vehicle. This ensures that the loan is paid off if you should become fatally injured or otherwise incapacitated and are unable to make payments on the loan. However, this is not something that is required by federal law, so consider if this is an expense you can afford. Also, check with your state's attorney general office about the requirements for this kind of insurance and keep in mind that the cost of the policy must be included in the amount of credit extended to you from the finance company.

Full Disclosure

Anytime you finance a vehicle or any large purchase, a lender must fully disclose all of your rights and responsibilities to you. Generally, lenders provide paperwork to this effect so that you can peruse the literature at your discretion. Two important pieces of information that your finance company must share with you include the Truth In Lending Act, which requires that your lender provide you with the full terms of the lending agreement. These terms must include an accounting of the finance charges, interest rate, late fees and anything else that may cause your payment amount to fluctuate. The finance company must also provide you with information on the Consumer Leasing Act, which talks about amount due at signing or at the delivery of the vehicle as well as monthly payment amounts and how many there are in the lease period.

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How Can I Add the Balance of My Old Car Loan to My New Car Loan?

You can elect to transfer your existing car loan balance to your new car loan. When this occurs, your new lender simply extends a larger loan than you need to purchase the new car. You can pay off your old loan with the outstanding balance, and you will then begin payments to the new lender. This process often happens without you even having to touch the money, making the process of adding the balance of your old car loan to your new car loan fairly straightforward.

Instructions

1

Ask for a payoff quote on your existing loan. Often, your payoff quote will be slightly larger than your remaining principal debt due to interest charges. Your lender will be able to tell you exactly what it will cost to repay the loan today considering these fees.

2

Get a trade in estimate on your car. If the sales price of your current car will repay the balance on your old debt, you do not have to worry about the outstanding loan balance. If the sales revenue is only enough to cover part of the debt, you will need to rollover a portion of the balance onto your new loan. You must good credit and a verified income source in order to qualify for new debt.

3

Get pre-approved for a new loan. The size of your new loan must be large enough to cover the cost of your new car and payoff your old debt. It is wise to get pre-approved so you know how much you will have left over, after paying your old debt, in order to purchase a new vehicle.

4

Shop for a car. Stay within your budget in order to give yourself the best options to pay off your debts in the future.

5

Arrange to close your old loan with your new loan. Typically, this can all occur on site at the car dealer. Most car dealers offer a financing arm, and you will be able to take a loan for your new car. You can offer your trade in to reduce the sales price of the new car. Then, tell your dealer you have an outstanding loan balance. The dealer will pay your old lender directly out of funds from your new loan. You will be able to trade in your car, pay off your old balance and finance your new car fairly easily.

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How Can I Check If There Is Still a Lien on My Car in New York?

A vehicle title lists a lienholder when an auto loan provider has a financial interest in a vehicle. New York does not send new titles once a borrower satisfies a lien, nor will it send a lien releases. The only way to remove a lien from a title is to submit a lien release to a motor vehicle office, which you can obtain from the listed lienholder. Since New York is one of the few states that allow title transfers when a lien exists, make sure the car's previous owner supplies you with a lien release if you're purchasing a car.

Instructions

1

Go to the New York State Department of Motor Vehicle's website. Click on "Online Transactions."

2

Scroll down until you reach the "Title Transactions" section. Click on "Title Certificate or Lien Status."

3

Locate your vehicle identification number (VIN) on your title, insurance card or registration. Click on "Begin Title Status Check."

4

Input the VIN, year and make of the vehicle. Click "Continue." If a lien still exists on the vehicle, you'll see the lienholder's name and the date it was first reported.

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Can I Buy the Car I Rent?

Sometimes, a person renting a car may wish to buy it. Whether the person will have the opportunity to do so will depend on the terms of the lease. Some leases allow a person to buy a car after the lease has been paid for a certain period of time. However, other leases will not afford the person this same opportunity, particularly if the lease is a short-term one.

Car Leasing

When a person leases a car, he is contracting to use the car for a set period time. The person does not take ownership of the car, but only pays for the privilege of driving it. When the lease period is over, the car's owner will retake possession of it, and the leasee will no longer be allowed to use it. However, some owners will be willing to sell the car.

Long-Term Leases

Generally, long-term leases -- leases of a year or more -- include an option that allow the renter to buy the car at the end of the term for a pre-set price. While the leasee does not have to exercise this option, he may wish to. In some instances, doing so may make financial sense, particularly if the price the leasee is required to pay is below the car's market price.

Short-Term Rental

In nearly all cases, a person who takes out a car for a short-term rental -- say, for a week while on vacation -- will not be given the option of buying the car after the rental is over. This is because the company renting the car uses a different business model than leasing companies. These rental companies rent cars for short periods of time to many customers, not long periods of time to a single customer.

Contracts

Whether a person can buy a car he is renting will come down to what his contract says. Some leases may allow the person to buy the car at any time, while others will not allow him to buy the car at all. For short-term car rentals, a person will likely not be allowed to buy the car, but it can't hurt to propose a deal to the car's owner.

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How Does APR on a Car Loan Work?

APR stands for annual percentage rate. The APR on a car loan is the interest rate of the loan. The APR is one of the factors that determines the amount of a car payment and is a factor that a buyer has significant control over. The APR a buyer receives on a car loan is based on several factors.

Function

The payments on a car loan are calculated with each payment comprised of part interest and part principal repayment. The amount of interest is higher for early payments because the interest amount is based on the amount of principal outstanding. Each payment has less interest and more principal paid than the previous one. A higher APR requires that more interest be paid resulting in a higher monthly payment.

Significance

The effect of different interest rates or APRs can be dramatic. A $20,000 car loan with a 7 percent rate and 60 month term would have a monthly payment of $396. If the car buyer can only qualify for a 12 percent loan, the payment would jump up to $445 per month. The loan with the higher APR will pay almost $3,000 more in interest over the term of the loan.

Considerations

The most important factor in what APR a car buyer qualifies for is the buyer's credit history and credit score. Buyers with good credit will qualify for the lowest APR and have several financing options to choose from. Car buyer with bad credit will pay a higher APR and will have limited choices for terms and payments.

Factors

There are several factors that affect the APR on a car loan. Longer term loans will have a higher APR than short term loans. New cars will qualify for lower rates than used car loans. Buyers who put down a cash down payment will usually qualify for a lower APR than buyers with no down payment. Promotional rates from car manufacturers will be lower than the rates offered by banks and credit unions.

Potential

Unless the car loan APR is a promotional rate or the buyer has very bad credit, most APR offers from car dealers are negotiable. Dealers get the rates from the lender at a wholesale APR and then add to the rate to earn additional profit. Always negotiate with the dealer finance department for a lower APR on the car loan. Saving one-half or one percent on the interest is like saving several hundred dollars on the price of the car.

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Paperwork Needed to Donate a Vehicle in Texas

Charities that accept car donations try to make the process as easy as possible. In the state of Texas, you need the title of the vehicle, without any liens attached to it, to donate your car, truck or motor home. Ask for a receipt from the charity for your tax return, and you should submit a Vehicle Transfer Notification form to the Department of Motor Vehicles.

Title

The most important paperwork you need to donate your vehicle is the title. The vehicle's title documentation shows that you are the legal owner and have the right to dispose of the vehicle. Sign and date the appropriate portion in the title, which is identified as "seller's information." Although a donation is not a sale, the information you must provide on the title document is the same as you would if you were selling the vehicle. Enter your name, address and date of the transaction.

Lien Release

If the vehicle's title does not show a lien, signing the title document in the presence of the charitable organization's representative is sufficient. If, however, the title shows the name of a lien holder, you cannot sell or donate the vehicle until the lien is removed. A lien means that another party, usually a lender who provided some of the funds for the purchase of the car, has legal claims to the vehicle. Before the vehicle can be sold or donated, all loans must be paid and a "lien release" obtained from the lien holder. This documentation will show that the lien holder no longer has any claims on the vehicle and that the person whose name is printed on the title can sell or donate the car freely.

Vehicle Transfer Notification

Fill out a Vehicle Transfer Notification form to notify the Texas Department of Motor Vehicles that the car no longer belongs to you. This notification will absolve you of any legal penalties associated with the misuse of the vehicle. If the car is parked illegally after you donate it, for instance, and the owner is tracked through the vehicle identification number, you may be liable unless you have filled out a Vehicle Transfer Notification.

The Vehicle Transfer Notification should be mailed to the address shown on the form, together with a $5 processing fee.

Receipt

Vehicle donations are tax deductible, if you have a receipt proving that ownership was transferred to an IRS-recognized charitable organization. Obtain a receipt at the time of the donation, clearly identifying the make, model, year and vehicle identification number of the car. The charity's name and address should clearly be indicated on the receipt, along with the date of the donation. The receipt should be signed by a representative of the charity. In addition to providing the necessary proof for your tax deduction later on, the receipt will provide further security in case of illegal operation of the vehicle following the donation. By presenting a copy of the receipt, you can more easily prove that the car was no longer yours following the date and time of the donation and you are not responsible for any damage arising from its improper use.

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How to Refinance a Car Under the Name of a Spouse

Several situations could lead you to refinance a car under your spouse's name instead of yours. One common situation is in a divorce when the spouse who is going to keep the car is not the one who has full legal responsibility for repaying the loan. Another reason for refinancing is if one spouse has better credit than the other and can get a lower interest rate on the car loan. Regardless of the reason, refinancing a car loan under a spouse's name requires a few major actions.

Instructions

1

Call the current lender and ask for the loan payoff amount. This might appear on your most recent statement, but you should call to confirm because some lenders will add a prepayment penalty.

2

Choose the lender who your the spouse will use for the refinance. You can either use the same lender or choose a different one that offers better interest rates.

3

Apply for an auto loan refinance with the desired lender. Only the spouse whose name will appear on the loan should fill out the application. Include the information on the loan payoff amount on the application as the amount that you need to borrow, unless you plan to make a cash down payment so you can borrow less.

4

Complete the refinance; have the new lender send payment on the loan to the old lender.

5

Sign over the car title to the spouse whose name is on the refinanced loan. If the car is already in both of your names and you are not getting divorced, you should not need to change the title. However, if the car was titled only in your name and your spouse is refinancing the car, you will need to sign over the title.

6

Take the title to your state's department of motor vehicles to complete the transfer of ownership. You will need to pay a titling fee to obtain a new title with the correct name on it.

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Can a Repo Be Removed From Your Credit Report in Florida?

Once you have a repossession on your credit report, you can only have it removed under specific conditions. Florida complies with the guidelines outlined in the Fair Credit Reporting Act for disputing information on your credit report. Florida's statute of limitation laws also impact your ability to have a repossession removed from your report.

Definition

The term "repo" generally refers to automobile or other vehicle repossession. Repossession is often the result of defaulting on a loan in which the vehicle was used as security. Specific credit agreements define the terms of default and give the creditor the right to repossess the vehicle as soon as a default occurs. In Florida, creditors may come onto your property without notice to seize the vehicle, but they may not use physical force or threats of force to do so. Florida laws consider physical force or threats to be a "breach of the peace." If the creditors commit a breach of the peace, they are liable for penalties and compensation for any harm.

Deficiency Judgment

Creditors who repo property in Florida may then resell the property and apply the proceeds to your outstanding loan. If the sale does not produce sufficient funds to cover what you owe, the creditor may choose to sue you for a deficiency judgment. Deficiency judgments are negative entries on your credit report in addition to the negative repo account entry. Florida judgments are valid and collectible through wage garnishment, property seizures and bank account levies for up to 20 years.

Statute of Limitations

Vehicle installment loans fall under the written contract statutes. The Florida statute of limitations for written contracts is five years. This means that the creditor has five years from the date of your last payment to sue you for a deficiency judgment. The creditor may file a suit if the repo account is out-of-statute, but you can present an SOL defense and block the deficiency judgment.

Dispute

To have a repo in Florida removed from your credit report, you must file a dispute with each credit reporting agency listing the repo account. According to the FCRA, negative account listings may be removed from a consumer's credit report after seven years. If the creditor won a deficiency judgment against you, the judgment is allowed to remain part of your credit report for as long as it is valid, or up to 20 years in Florida. If the deficiency judgment or the repo account listing is inaccurate, you may file a dispute to have them removed prior to seven or 20 years. Each credit reporting agency offers multiple ways to dispute the information on your credit report.

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How Can I Lower My Monthly Car Payments?

Car payments can get overwhelming to the point of making you consider turning the car into the bank. Although the idea may be tempting, this will result in a blemish in your credit report, and you will also lose all the money you paid for the car up until that point. Instead of giving up the car, consider working toward lowering your monthly payments.

Make Yourself Look Good

The first step to lowering your car payments is to be a responsible creditor. If you always pay your bills on time and your credit score is good, chances are you can simply ask the company to lower your payments. It may not work, but it doesn't hurt to ask. If you do it, wait at least a year since you begin your payments, so they have a way to check your past behavior and see that you're responsible.

If you come into a lump sum of money at some point, consider making a larger payment at once and then asking the company to recalculate your payments based on the fact that you made that payment. You can also choose to pay a little bit extra each time for as long as you can. That will also affect the overall total you owe and you'll have more chances for a price reduction later on. If you can't get them to agree to lower payments, see if they would agree to drop the percentage you're being charged in interest.

Consider a Car Refinance Loan

A car refinance loan is essentially what the name implies, a loan meant to help you pay off your car or lower your overall payments. Lending companies should help you figure out whether you qualify for a loan without charging you a fee, so shop around if you're being asked to pay something. If you have bad credit and don't qualify for a full loan, a refinancing company can help you get a reduction in interest rate or to extend the length of your original loan, so in turn your monthly payments will drop.

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What Are the Consequences of Not Paying a Car Title Loan?

Car title lenders offer quick, easy-approval loans using a borrower's vehicle as collateral. Loan amounts are based on a fraction of the car's resale value. Expect to leave your title, spare keys and a signed contract to obtain your loan. The USA.gov website warns that interest rates for car title loans are as high as 25 percent for a one-month term and are often difficult to pay back for borrowers with limited resources.

Vehicle Repossession

If you don't pay the title loan company, it will likely repossess your vehicle without warning depending on your state's rules. Some title loan companies repossess a vehicle as little as one day after a missed payment. The company can seize your vehicle from just about anywhere, such as your employer's parking lot, your driveway or from a store parking lot. Once the company repossesses your vehicle, it may resell it and keep the profit from the sale unless you pay your loan balance in full.

Damaged Credit

Some title loan companies report to the credit bureaus; some don't. Ask your lender directly about its credit reporting procedures. If you fail to make your payments, the repossession is reported to the credit bureaus and remains on your credit report for at least seven years. A repossession affects future lending opportunities. You might obtain a loan approval after the repossession, but with higher interest rates and restricted loan terms, such as a short term or large down payment requirement.

Interest Charges and Late Fees

Car title lenders are considered predatory lenders because of extreme interest charges and late fees. Some loan companies charge a high interest rate, such as 25 percent, and a full loan payment within 30 days. If you don't pay the loan, you can roll the balance into another 30-day payment plan and pay an additional 25 percent interest including late fees. If you're unable to make payments by the loan maturity date, you might pay back thousands of dollars in interest. The USA.gov website warns that triple-digit interest charges from extending the loan results in high payments.

Warning

Don't pursue a title loan unless you have the resources to repay the loan amount. Most people who need fast cash on short notice are often experiencing financial hardship, so paying back the loan with high a interest rate might prove difficult. Title loan lenders provide loans equal to a small percentage of a car's value, so consider selling your vehicle for its full private sale value instead. If you have questions about the title-lending rules in your state, the USA.gov website suggests contacting your state's consumer protection office.

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What Happens to Your Deposit at the End of a Lease on an Auto?

The main difference between buying and leasing an auto is the type of financing you receive. When buying a vehicle, you secure purchase financing, while leasing results in use financing. All other differences are a direct result of this fact. One of these differences is the deposit you make at the lease inception, a fee that does not apply to purchase financing. Whether or not you receive all or a portion of your initial deposit at the end of your lease depends on the condition of your auto and the terms of your lease.

Down Payment versus Deposit

The number of fees you pay at the beginning of your lease may make it difficult to distinguish one from the other. Especially confusing to some is the difference between the down payment and deposit. These are not the same. A down payment, which your lender may or may not require and you never get back at the end of the lease, reduces the total amount you finance and lowers your monthly payment. A deposit, also known as a security deposit, is a flat fee your lender charges as protection in case you damage the vehicle or violate the terms of your lease agreement. A lender may return this amount to you at the end of your lease agreement. Not all lenders charge a deposit, especially if you have good credit or are a returning customer. When they do, the minimum deposit you pay is most often the same as your monthly lease payment

Factors Affecting Your Refund

An auto lease specifies the number of miles, usually 12,000 to 15,000, that you may drive over the term of the lease. Mileage in excess of this amount reduces the value of the auto, and you will incur an excessive mileage charge according to the terms in your lease agreement. Another factor that can affect your deposit refund is excessive wear and tear. This includes both visible and unseen damage, such as broken or missing auto parts, body damage, cracked or broken windows, permanent damage to the carpet or upholstery fabric, excessive wearing of the tires and subpar repairs.

Time Frame

When your lease ends and you return the auto, it may take up to a few weeks to find out how much of your deposit to expect as a refund and to receive any amount due. After receiving a cost estimate for excess mileage, wear and tear or damage to the auto, your lender checks to see if there are any other costs, taxes, or fees, such as parking tickets, still outstanding. When your lender compiles this information, you will receive a refund of your deposit, minus any outstanding charges.

Considerations

If you have a few extra dollars but less-than-stellar credit, consider offering to make a larger deposit than your lender requires. According to LeaseGuide.com, you may be able to negotiate a lower finance rate and reduce monthly lease payments by increasing the size of your deposit.

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A List of Cars Eligible for a Canadian Clean-Car Rebate

The ecoAUTO rebate plan, also known as the Clean-Car Rebate, was in effect in Canada from March 20, 2007 to Dec. 31, 2008. The plan gave rebates ranging from $1,000 to $2,000 to people who bought new, fuel-efficient cars. Qualifying vehicles needed to use 6.6 liters per 100 kilometers or better for cars and 8.3 liters or better for light trucks. Flexible-fuel vehicles had to have a rating of 13 liters per 100 kilometers. The government gave $191.2 million in rebates to over 169,800 applicants in the two years.

2006 Models

The 2006 Toyota Prius, diesel Mercedes-Benz Smart Fortwo CDI Coupe, diesel Mercedes-Benz Smart Fortwo CDI Cabriolet, Honda Civic Hybrid, diesel Volkswagen New Beetle TDI, Ford Escape HEV (including the 4X4) and diesel Volkswagen Golf TDI qualified for a $2,000 rebate. These vehicles had a Combined Fuel Consumption Rating (CFCR) of 4.1 to 5.5 liters per 100 kilometers.

The diesel models of the Volkswagen Jetta TDI, Volkswagen Jetta Wagon TDI, Volkswagen Jetta TDI, Lexus RX 400H 4x4, Toyota Highlander Hybrid 4X4 and Volkswagen New Beetle TDI qualified for a $1,500 rebate with CFCRs of 5.9 to 6.0 liters per 100 kilometers.

The Toyota Yaris (manual and automatic), Toyota Corolla, diesel Volkswagen Jetta Wagon TDI and diesel Volkswagen Golf TDI CRCRs ranged from 6.3 to 6.5 liters per 100 kilometers and qualified for $1,000.

2007 Models

The 2007 Toyota Prius, Honda Civic Hybrid and Ford Escape HEV gained $2,000 rebates for their owners with a CFCR of 4.1 to 6.6 liters per 100 kilometers.

The Toyota Camry Hybrid, Nissan Altima Hybrid, Ford Escape HEV 4X4 and Toyota Camry Hybrid qualified for $1,500 from the government with a CFCR ranging from 5.4 to 7.8 liters per 100 kilometers.

The Toyota Yaris, Toyota Corolla, Mini Cooper, Saturn VUE Hybrid, Lexus RX 400H 4x4, Toyota Highlander Hybrid 4X4, Jeep Compass 2x4, Jeep Patriot 2x4, Jeep Compass 2x4, Jeep Patriot 2x4, Chevrolet Impala FFV, Chevrolet Monte Carlo FFV and Chrysler Sebring FFV (automatic and manual) were worthy of $1,000. They had CFCRs from 6.3 to 15.0 liters per 100 kilometers.

2008 Models

In 2008, the last year of the program, the Toyota Prius, Honda Civic Hybrid, Smart ForTwo (coupe and convertible), Ford Escape Hybrid (FWD and AWD) and the Saturn VUE Hybrid qualified for $2,000. These models had a CFCR of 4.1 to 7.3 liters per 100 kilometers.

The $1,500 vehicles were the: Toyota Camry Hybrid, Nissan Altima Hybrid and Toyota Highlander Hybrid 4x4. CFCRs of 5.7 to 7.7 liters per 100 kilometers were seen.

The remaining $1,000 rebates went to the Toyota Corolla, Toyota Yaris, Mini Cooper Clubman, Mini Cooper, Toyota Yaris, Honda Civic (2- and 4-door), Honda Fit, Lexus RX 400H 4WD, Jeep Compass 2x4, Jeep Patriot 2x4, Chevrolet HHR FWD, Chevrolet HHR Panel FWD, Nissan Rogue FWD, Jeep Compass 4x4 (and 2X4), Jeep Patriot 4x4 (and 2X4), Chevrolet Impala FFV, Dodge Avenger FFV, Chrysler Sebring Sedan FFV and Chevrolet Impala FFV. These models had a CFCR of 6.3 to 8.3 liters per 100 kilometers.

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What Can I Do When I No Longer Want to Make Payments on a Car Note?

Car payments are usually the second largest payment a person makes per month, after their rent or mortgage. In troubled economic times, many find it hard to make the payments on their cars. There are several options on things to do if you no longer want to make payments on a car note, but it all boils down to whether you want to keep the car or not.

If You Want to Keep the Car

The only way to get out of making payments for the car and to keep it is to pay the loan off in full. The bank does not care where the money comes from to pay off the loan--a friend, family member, home equity loan, and so on. Until the car is paid off and the title is sent to you, you are on the hook to them for payments. Even making significant payments toward the principal will not place payments on hold for a while; it just shortens the term of the loan.

If You Are Leasing the Car

If you let the car go, there are more options for getting out of your payments. If you have a lease, look into a lease exchange program. These are programs that connect people who are looking to get out of a lease with those that are looking to assume one. The person assuming the lease will have to qualify for the lease and it has to be approved by the leasing company. You could also find out the payoff figure from your lender and sell the car. If you owe more than what the car is worth, then you will be expected to pay the difference. The lender may be willing to make payment arrangements for the balance, or you may get it from another source.

If You Are Financing Ownership of the Car

If you are financing the car, you can also sell the car. You can then buy a less expensive car, if you owe less than what you sell the car for. If you owe more than what you can sell the car for, you have two options. You can sell the car and either pay the lender the balance, or you can ask the lender to agree to a short sale. This is when the lender agrees to take less than what is owed on the car in order to avoid the fees and hassle involved with repossession. Once the title changes hands, the balance of the loan is due in full, so you cannot have someone assume the title and the payments, like subletting an apartment.

If you do not want to make payments, the only other option is repossession, whether voluntary or involuntary. Both are equally damaging to your credit and can keep you from being able to qualify for a mortgage, car loan or credit card for up to seven years. In repossession, the car is sold at auction and you are responsible for the balance between what the car sold for and the loan amount plus fees. That means you will be paying for a car you no longer own and have trashed credit along with it. The only benefit to voluntarily turning in the car is that you avoid being responsible for the fee to the repo agency.

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How to Check the Financing on a Car

If you are about to purchase an automobile you may want to know about the financing, including the terms and conditions. The dealership may have their own financing department, and they will provide you with a rough idea of what your financing options are. The interest rate you receive will determine the amount of finance charges you pay over the term of the loan. You also pay more finance charges the longer your loan term is. If you dont want to get financing from the dealership, you can apply at your own bank. You will not know the interest rate until the lender looks at your credit report.

Instructions

1

Decide where you are going to apply for automobile financing. You can apply at the car dealership, a credit union or your own bank. Depending on the amount of the loan you may be able to finance your automobile with a credit card if the limit is large enough. Check several sources for financing.

2

Apply for financing. Submit an application to the institution of your choice. They will need your name, address, date of birth, Social Security number, several personal references and phone numbers for your home and place of employment. The lender will get a copy of your credit report. If you have a bad credit you could receive a higher interest rate, which increases your payments and the finance charges you pay.

3

Review the terms and conditions of your financing with the lender. Once your application is approved, the lender will provide you with the details including how many months you will have to pay, the amount of your monthly payments, interest rate and the total amount of the loan. For example, an auto loan in the amount of $20,000 for 72 months with an interest rate of six percent will have monthly payments in the amount of $331.46. The total amount of the payments will be $23,865.12 (72 x $331.46). This figure includes principal plus interest ($20,000 + $3,865.12).

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How to Get Financing for a Truck After Bankruptcy

Bankruptcy affects your ability to get credit, but a secured loan, such as financing for the purchase of a vehicle, is easier to get compared to an unsecured loan product like a credit card. You have several different options to try to get truck financing after a bankruptcy, and the effectiveness of these options depends on your personal financial situation.

Instructions

1

Check local dealerships for "Buy Here, Pay Here" establishments that offer bad-credit loans. Some of these dealerships may offer loans specifically for post-bankruptcy clients, while others give higher interest rates for bad credit borrowers.

2

Call local truck dealerships and ask to speak with the financing department or loan officers. Ask if any financing is available for post-bankruptcy consumers.

3

Visit local credit unions and talk to loan officers directly. Credit unions often have programs in place that are more lenient on credit requirements, and you can try to convince the loan officer to give you a truck loan when other lenders will not.

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Alabama Car Repossession Rights

Vehicle repossessions occur when car buyers obtain vehicle loans to finance their car purchases. In exchange for the loan proceeds, banks retain their ownership rights to their security interests. When car buyers default on their loan agreements, banks typically have legal rights to reclaim their security interests or collateral after one missed payment. State laws determine what recourse buyers may have against repossession agencies hired to repossess vehicles for banks.

Alabama Consumer Credit Rights

Under Alabama law, creditors must provide consumers with two copies of all signed documents signed during the loan application process. Furthermore, loan documents must contain a consumer protection provision, in all capitalized letters, warning consumers to review their loan agreements prior to signing them.

Contractual Rights

Alabama allows credit agencies to insert acceleration agreements in their contracts providing them with the right to demand full payment of the remaining loan balance when borrowers default on their loan agreements. In addition to requiring car buyers to pay any remaining loan balances after banks sell their vehicles, the state's statutory code allows them to request repayment of repossession costs. However, when borrowers obtained original loans that were less than $1,000, then, under state law, they are not personally liable for any remaining deficiency after repossession and sale.

Repossession Notifications

Repossession agencies must notify car buyers of scheduled sales. Although some states provide consumers with a redemption period allowing them to cure their deficiencies in exchange for a return of their vehicles, Alabama does not. Debtors do not have rights of redemption, and as long as owners provide car buyers with notification of private or public sale, then they have satisfied their notification obligations.

Breach of Peace

Alabama law allows banks to reclaim their vehicles upon buyers' default on their loan obligations through judicial or nonjudicial methods. Judicial methods allow banks to obtain court orders prior to seizing their vehicles. Nonjudicial methods allow banks to hire third-party repossession agencies to reclaim vehicles on their behalf. As long as those repossession agencies do not violate public policy laws by using force or destroying property, then banks may engage them to repossess vehicles used as collateral for their loan proceeds.

Considerations

Since consumer protection laws can frequently change, you should not use this information as a substitute for legal advice. Seek advice through an attorney licensed to practice law in your jurisdiction.

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What Legal Actions Can I Take as a Co-signer on a Delinquent Car Loan?

A co-signer on a car loan is liable for the payment of the delinquent balance in the event the borrower defaults in his repayment obligations with the lender. In the absence of fraud on the part of the bank that issued the loan, the legal actions a co-signer can take in the event of delinquency are somewhat limited.

Function

In order to reduce their credit risk for loans to potential borrowers who either have a poor credit record and/or no credit or employment history, many lending institutions require a co-signer as a condition for making a car loan.

Co-signer Liability

In the event of a delinquency, the contractual liability of the co-signer is absolute: It is not contingent upon the lender's first seeking recourse against the borrower. Once the borrower breaches the repayment terms and conditions of contract with the lender, the co-signer assumes all liability for payment of the loan. Some car loans may contain an acceleration clause that gives the bank the right to demand the remaining balance due in the event a scheduled payment is delinquent.

Terms of the Agreement

All parties to the car loan agreement (borrower, co-signer and lender) are bound by the terms and conditions of the contract. A co-signer may have a right of action against the lender if they do not comply with the terms of the loan. For example, some loan agreements may have a cure provision that allows the borrower or co-signer the ability to cure the default by tendering the missed payment within a specified number of days after it was due. If the lender fails to abide by the cure provision, the co-signer would have a right of action against the bank for breach of contract.

Notice Requirements

Many loan contracts contain notice provisions that obligate the lender to provide written notice to the borrower and co-signer in the event of a default. If the bank fails to timely notify the co-signer of a delinquency prior to declaring the loan in default, the co-signer would have an action against the lender for breach of contract. Compliance with the contractual notice provisions would have particular significance if the co-signer had been able to exercise his right to cure the default and avoid the consequences of any acceleration clause.

Action Against the Borrower

A co-signer may have an action against the borrower for fraud if the borrower made fraudulent representations to the co-signer related to his employment or ability to pay back the car loan in a timely manner. In addition, a co-signer may have entered into a binding legal contract with the borrower that specifies that in the event of a delinquency that triggers the co-signers repayment obligation on the car loan, the borrower will be liable to the co-signer for all amounts paid to the lender as a result of the borrowers delinquency.

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Can I Buy the Car at the End of the Lease?

You can purchase your car at the end of its lease. The car's purchase price is stated in your lease contract as the last payment. To purchase the car, you can obtain financing at a lender of your choice; you don't have to use the same bank for financing as you did for your lease.

Vehicle Value

Before purchasing your lease, determine if its purchase price is fair. Just as you wouldn't purchase a used car for more than suggested retail value, you should not purchase a leased vehicle for a price higher than retail value. Research your car's value at Edmunds.com or the Kelley Blue Book website. Your lease purchase price was determined the day you signed your contract, so the value may be higher or lower than the current market suggests. If you find your lease buyout price is higher than resale value, offer a lower price to your leasing bank. Otherwise, you may find yourself in an upside down car loan, or owe more than your car is worth.

Shopping for Financing

Leasing banks offer competitive financing for new cars; the banks usually work with the manufacturer to offer lower-than-average rates or cash incentives. However, rates offered for used cars are rarely as competitive. Ask the leasing bank about the rates it offers for used-car purchases. Check the rates of banks in your area, such as a credit union or a bank where you hold an account. Once you find a good rate, you can often apply for a loan online at the bank's website, call or go to a bank branch to submit your application.

Warranty and Insurance Considerations

If you're out of factory warranty or will be soon, consider adding an extended warranty to your lease purchase. Most leases run during the term of the car's factory warranty. Without additional warranty coverage, repairs become your responsibility. Most banks allow borrowers to add the cost of warranty coverage into the loan amount. If your vehicle's loan balance is more than your vehicle's value, ask your bank or insurance agent about adding gap insurance, which covers the gap between your loan balance and vehicle market value if you suffer from a loss.

Other Lease-End Options

You do not have to purchase your lease to avoid paying over-mileage or lease-end fees. If you plan to pursue a new purchase, you can trade your leased vehicle to a dealer or sell it privately for the amount stated in your contract. If your vehicle's value exceeds the lease buyout price, you can keep the profit or put it toward a new loan. If you owe more than the car's value, you can provide a down payment or roll the extra fees into a new loan.

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How Long Do I Have to Cancel a Car Purchase?

The right to cancel an automobile purchase usually ends once you sign your loan agreement or pay the dealership in full for the vehicle. Federal and state laws do not provide the same protection for returning a car for a full refund as with retail purchases of different types. Checking your dealership's policy on returns can help protect your finances in the event you change your mind.

Dealer Discretion to Cancel

No state law provides a "cooling-off" period for automobile sales where you can change your mind and return the vehicle without penalty. This means your ability to cancel the purchase of an automobile rests solely in the hands of the dealership where you purchased the vehicle. You should inquire if the dealership you're purchasing a vehicle from has a return policy or a money-back guarantee before you complete the sale and take delivery of the car. Doing so can help you make an informed purchase.

The Cooling-Off Rule

The Federal Trade Commission oversees the proper application of the federal cooling-off rule. This regulation allows you as a consumer to seek a full refund for a retail sale of $25 or more within 72 hours of the purchase. According to the Federal Trade Commission's website, this law does not apply to an automobile purchase. This means no law exists at the federal or state level giving you the right to cancel a car purchase. The sale is usually final.

State Lemon Laws

Each state across the country has a Lemon Law for automobile purchases. This allows you to return a defective vehicle under a specific set of circumstances. The total time you have to report a defect to your dealership varies by state, though usually falls in the 1- to 4-year period plus any additional time allowed by vehicle warranty. To qualify under a state's Lemon Law regulations, your vehicle must have a defect that significantly impacts performance or vehicle safety; in addition, your dealership must have attempted to repair the defect repeatedly, but without success. The total number of required repair attempts varies by state.

Contacting Your Dealership

If your financial situation changes due to sudden job loss or serious injury, you should contact your dealership as soon as possible. You may be able to work out an arrangement with your dealership to return the vehicle as long as you purchased the vehicle recently and the vehicle has no damage. However, your dealership has no requirement to allow you to return the vehicle, and your obligation to repay an existing auto loan remains.

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What Is Needed When Purchasing a Vehicle From a Private Seller in Florida?

When purchasing a vehicle from a private party in the state of Florida, you must obtain the title, with the appropriate portion filled out and signed by the seller. In addition, you have to fill out the Application for Title. These two documents must be submitted to your local Department of Motor Vehicle Office, together with a receipt that shows payment of the mandatory fees.

Title

First and foremost, you must obtain the title of the vehicle. Check all pertinent information printed on the title and ensure it matches the claims made by the seller. The correct model year and model information are always those printed on the title. The name of the legal owner of the vehicle will likewise be displayed on the title document.

The legal owner must complete the "Transfer of Title by Seller" section of the title, signing his or her name and dating the transaction. When in doubt, ask for identification to ensure the individual signing the title is the actual owner of the vehicle. Only the owner or someone who is given power of attorney for this transaction can sign the title over to you.

Application for Title

After obtaining the title, complete with the seller's signature, you need to fill out the "Application for Certificate of Title With/Without Registration." The form asks for your name, address, date of birth, information on co-owners, the intended use of the vehicle and information on lien holders. The odometer reading of the vehicle at the time of the purchase also must be recorded and the form signed and dated.

If no sales tax is due on the vehicle, the reason for the exemption must be noted. Such reasons include, but are not limited to, the transfer of title due to inheritance and the exchange of one vehicle for another of the same or lower value.

Sales and Use Tax

Before you can proceed with the transfer of title and registration, the tax due on the transaction must be paid to your county's tax collector office. The intended use of the vehicle and the value will determine the tax due. If the vehicle was obtained at significantly less than fair market value, make sure to obtain a Bill of Sale from the previous owner stating this sale price. Otherwise, the tax assessment will be based on the estimated fair market value of the vehicle.

Submit Application

When you have collected all necessary documentation, you can apply in person at your local tax collector or license plate agency, or mail in the package. Expedited service is available in some tax collector offices for an additional $10. Contact your local tax collector office to find out if it offers expedited service.

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Tennessee Law on Title Loans

Title loan laws vary from state to state. Some states have heavy restrictions on title lenders, and others do not. In Tennessee, lenders must conduct their business according to the Tennessee Title Pledge Act.

Benefits

The Tennessee Title Pledge Act helps prevents lenders from taking advantage of borrowers. The law sets restrictions on licensing, rates and holding periods before a car faces repossession. If lenders do not follow the law, they can face penalties and lose cash.

Significance

The Tennessee Department of Financial Institutions enforces the law and regulates, examines and investigates complaints of the title loan industry. "In 2009, 812 examinations were conducted, resulting in refunds of $64,815," according to the 2010 Report on the Title Pledge Industry which is posted on the department's website.

Ammendments

On June 17, 2005, several amendments to the Tennessee Title Pledge Act were signed as law. These amendments changed how lenders practiced business in the state but did not affect how they can set interest and rates.

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How to Get a Loan on a Van

Van loans are available from a variety of different lenders. Most dealerships offer financing for the buyer at the time of the van purchase, but the buyer should check with other loan sources to try and find the lowest available interest rate. If the buyer is purchasing a van from a private seller, a local bank or credit union is usually the best source to check with for financing.

Dealer Financing

Once you finalize the purchase, apply for a loan with the dealer's financing source. The salesperson will take you to the finance manager's office to complete a loan application. The finance manager will send your application to all of the lenders that the dealership uses for vehicle financing. If you receive multiple approvals on the application, the finance manager will let you know what interest rate and loan term each lender offers. Choose the lender with the lowest interest rate or the longest loan term if you want a lower monthly payment.

Bank Loan

Contact your bank and ask to speak with a consumer loan officer. Find out what the interest rate is for the type of van you are buying. Ask the loan officer if you can get a discount on the rate by having the monthly van payment taken directly out of your checking account. Apply for the loan if you are buying the van from a private seller, or if the interest rate is lower than what the finance manager offers you at the dealership. When you receive an approval, arrange a time to close on the loan. Make a note to subtract the payment from your checking account each month, if you are using the automatic deduction option.

Credit Union Loan

If you are a member of a local credit union, check with a loan officer to find out the interest rate for your van. If you are not a member of a credit union, you can still research the interest rate and then join the credit union if you want to apply for a van loan. If the credit union has a better financing package than your bank, contact your bank loan officer and cancel your application. Arrange a time to take delivery of the van once you close on the credit union loan.

Home Equity Loan

Apply for a home equity loan with your bank or credit union if you do not want to use traditional auto financing. Depending on the interest rate environment at the time you buy the van, home equity rates may be lower than auto rates. There may also be tax advantages to using a home equity loan, which can save on your total van purchase cost. Check with an accountant for advice before you decide to use a home equity loan to finance the van. Once you close on the home equity loan, contact the seller to take delivery of the van.

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Can You Trade in a Lease Early?

Almost any car lease or finance arrangement can be terminated early by trading in the vehicle. This does not mean a lease can be traded in with little or no out-of-pocket cost, however. The major considerations are the amount of money still due on the lease and the terms of the lease contract.

Lease Function

A leased car is actually owned by the leasing company. To trade in a lease, the dealer for the new car must pay off the lease termination cost to the leasing company. The dealer will allow the wholesale value of the car as a trade credit and the cost to terminate the lease will be charged against that credit. The termination cost of a lease is usually significantly higher than the trade value of the leased vehicle. This puts the person trying to trade the leased car in a negative equity position.

Time Frame

The ability to get out of a leased vehicle into a new car is dependent on the amount of time remaining on the lease. The Leaseguide.com website notes that it is very difficult and expensive to get out of a lease early or in the middle of the lease term. The leased car is depreciating rapidly and the lease termination costs will be very high. Only in the last four to six months of a lease will it be possible to trade out without paying a lot of upfront cash.

Pay the Payments, Not the Lease

It is often less expensive for the dealer of the new car to make the remaining lease payments and turn the leased vehicle in to the leasing company. The balance of the payments for the lease can then be rolled into the financing or lease for the new car. The total of the remaining payments may be significantly less than the amount the leased car is upside down in relation to the lease termination cost. The person trading the lease will still be responsible for possible lease end charges such as excess mileage.

Same Brand Trade-In

If you trade your leased vehicle in for another car of the same brand, the leasing company may give you a break on the lease termination costs. This only works if the leasing company is the finance arm of the car manufacturer, for example, a Honda leased through Honda Financial Services. To facilitate the sale of new cars and provide a supply of good trade-ins to dealers, there are times when the captive leasing companies cut special deals for car owners who want to trade a leased car in early.

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How to Find Out If There Is a Loan on My Title

If you purchase a car from another private party it involves an immense amount of trust. You trust that the car is in acceptable working condition and not a "lemon." But you also trust that the car title you received from the previous owner is free and clear of any bank or title loans. Also, when you finally pay off your own car loan, you may want to verify that the department of motor vehicles has officially removed the bank's claim on the vehicle. Luckily, it is usually simple to figure out this information.

Instructions

1

Review the title document thoroughly and check under "Lienholder" or the similarly named section of the title. If you see a bank listed under this section that indicates that a loan, or lien, is still associated with the car ownership. If not, you can still proceed with additional checks if you wish to verify that the title is free and clear of loans.

2

Write down the vehicle identification number for the car as well as the make, model and year --- all of which are commonly printed on the title. Determine the state where the car is currently registered as well.

3

Call the state department of motor vehicles where the car is registered and provide it with the vehicle information you've retrieved from the title. Request current information about the car's lien history to see if a bank is currently associated with the car. You may have to pay for a full vehicle history report. You can also retrieve this information from a third-party paid car history reporting service as an alternative option.

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