What to Do if You Are Upside-Down on an RV Note & Need to Sell It

To transfer the title of your RV, you must pay off your loan and obtain a lien release or proper title signature, depending on your state's requirements. You may use the proceeds of your sale to pay off your lender, but you'll have to provide the rest of the money yourself to satisfy the loan.

Lender Payoff

Call your lender to find out how much you owe on your RV loan. Also ask for your loan's per-diem amount, which is the amount of interest charged to your loan daily. You'll have to add the per-diem amount to your payoff each day until your sale. This is a good time to ask about the loan pay off process so that you can communicate better with your buyer during the selling process; your buyer will want to know when he can take ownership of the RV. If the lender is local, you can likely arrive in person to pay off the RV loan and obtain a title or lien release to give to your buyer the same day.

Valuing Your RV

The more you can get for the RV, the less you will have to pay out-of-pocket, so you want to make sure you get a fair price. Access online RV appraisal guides and use a median value among the different guides, as values will vary. Keep in mind that values will differ by area. You might find you can get more or less than online appraisal values. Checking RV classifieds will help determine how much similar RVs are selling for in your area.

Buyer Payment

Once you have an idea of how much you can expect to get for your RV, budget accordingly to satisfy your loan. You'll need to have your money ready before you find a buyer. This way, you and your buyer can go to your lender (if it is local) to satisfy the loan. If the lender isn't local, you can arrange a conference call with the buyer and lender to verify the amount due on the loan. Make the excess payment before your buyer so that he can verify that his payment satisfies the loan amount. Your buyer can pay you or your lender for the remaining balance due on your loan after you make your payment.

Trade Option

A dealer can take your RV for trade toward another purchase. The excess value that you owe on your loan goes toward your new purchase or loan amount. Many states offer a tax deduction for RV trade-ins. Since you already paid tax on the RV you want to trade, you can reduce the selling price of the new RV by the dealer's appraisal value before applying sales tax. Depending on your RV's value and your area's tax rate, you can save thousands of dollars in tax charges.

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California Liability Law on Used Vehicles

In California, the Car Buyers Bill of Rights protects consumers that purchase new and used vehicles. Under the state's consumer protection law, used car buyers have rescission periods to cancel their purchases. California further protects used car buyers with mandatory disclosure laws that dealers must comply with prior to completing the invoice or sales transaction. These used car consumer protection laws generally apply to transactions between a used car dealer and car buyer.

Song-Beverly Consumer Warranty Act

The Song-Beverly Consumer Warranty Act is California's lemon law. Under the state's lemon law, manufacturers that cannot remedy a defect under their express car warranties must replace the vehicle or refund the owner for the cost of the transaction. The law covers both buyers and lessees leasing new cars. Under the law, buyers or lessees have the sole discretion to determine whether they would like a replacement car or refund of their fees, including purchase price, taxes, registration fees and incidental damage and repair fees the owner incurred. However, dealers may deduct fees for reasonable use determined by the state's calculation for deduction rules.

Exceptions to the Song-Beverly Consumer Warranty Act

Generally, California's lemon law applies to only new vehicles. However, it applies to used vehicles still covered under an express warranty. For example, car dealers that sell used cars still covered under the general warranty period are bound by the state's lemon law.

Car Buyer's Bill of Rights Rescissions

To provide used car owners with some consumer protections against dealers that sell "lemons," California enacted a rescission law allowing used car buyers with an option to cancel their purchases during a two-day cooling off period. Buyers purchasing used cars for less than $40,000 can cancel their transactions. The rescission rights do not apply to buyers who buy luxury vehicles exceeding $40,000 or buyers who buy cars from private sellers. The rescission rights do not extend to consumers buying RVs, ATVs, commercial-use vans or trucks.

Two-Day Timing

Car dealers can charge a contract cancellation fee up to a limited amount depending on the car's sticker price. Car buyers that buy the option must return their vehicles to their dealers by the end of the second rescission day unless the terms of their agreement provide otherwise. Purchasers have at least 250 miles to drive the car, but dealers can charge reasonable fees for restocking in addition to the charge for the rescission options. Buyers must provide the dealers with all of their original receipts and may not have altered the vehicle or have used it as collateral. Buyers that do not comply with the two-day rescission allowance must receive a nonacceptance letter from the dealer of its refusal to provide a return.

Invoice and Odometer Fraud

Under California law, dealers must provide car buyers with price accounting itemizations for all charges. Dealers must also provide buyers with an inspection report certifying the car's odometer reading and certifying the vehicle did not previously suffer any damage or accident. Dealers that do not comply with these disclosure laws are guilty of violating California Civil Codes by committing odometer fraud or inspection fraud punishable by imprisonment or fines.

Considerations

Since 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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How to File a Motorcycle Lien

An improperly filed lien leaves a creditor with no avenue to its collateral. The owner of a motorcycle does not truly own the vehicle until his financing is paid. The creditor's information is printed directly on the title at the time of acquisition. When the debt is settled, the state's Department of Motor Vehicles issues a new title without the creditor's name. If the creditor doesn't correctly file the lien, the creditor lacks the recourse needed to repossess the motorcycle.

Instructions

1

Read the title to get the motorcycle's year, make, model and vehicle identification number. Include this information on all paperwork.

2

Obtain financing paperwork, which varies by state and transaction. Typical documents include a promissory note and a security agreement. The promissory note is the agreement to repay the loan. The security agreement offers the motorcycle as collateral.

3

Acquire a motor vehicle financing statement from your state's Department of Motor Vehicles. The form must be specific to the state in which the motorcycle is registered. Complete and sign the financing statement along with the motorcycle's registered owner.

4

Attain a written statement from the vehicle owner specifying that he grants you permission to encumber the title to the motorcycle. Ensure that he identifies the vehicle using make, model and vehicle identification number.

5

Bring the motorcycle title, the financing statement, the owner's statement and a photo ID to your state's Department of Motor Vehicles.

6

Pay the registration fee. The amount varies by state.

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Why Do Dealers Ask for More Than the Kelley Blue Book Retail Price?

The Kelley Blue Book has grown into one of the more reliable resources for consumers looking to price an automobile away from the dealership. The source is so trusted by consumers, an auto dealer who prices his vehicles outside of the Blue Book's suggested range may raise eyebrows and lose customers. Despite this, there are some viable reasons a dealer may price his vehicles higher than Kelley Blue Book price.

Kelley Blue Book Doesn't Sell Cars

The Kelley Blue Book is a tool for measuring the average price of an automobile in certain circumstances and market conditions. The Kelley Blue Book has never sold a car, however, and does not take into account the facts on the ground at a dealership like the popularity of models in a given year or the location of the dealership. For example, if market conditions in a certain area show a car is selling well at a certain price, dealers are going to price those vehicles to match the successful selling price regardless of the Kelley Blue Book suggested retail.

Cetified Parts and Servicing

Kelley Blue Book's suggested retail pricing does not factor dealership-certified parts for used vehicles into its quotes to consumers. Certified used vehicles undergo stringent dealership inspections and often carry limited warranties which protect the vehicle for up to a certain mileage after purchase. A dealership typically charges more for these vehicles because they are less of a risk for premature failure than a used vehicle which has not undergone such thorough testing and replacement of potentially faulty components.

The Manufacturer Sets the Retail Price

For new cars, the manufacturer's retail price allows very little wiggle room for a dealership to price a new car. Since Kelley Blue Book suggests a "fair retail price" for a given new vehicle it can give consumers the notion that dealerships are charging an unfair price, when in reality they're simply charging the price required by the manufacturer. The belief that a consumer can haggle over the price of a new vehicle in the modern world is largely a myth.

It's Only a Suggestion

The price listings available through Kelley Blue Book's website and its print publications are only suggestions, not requirements. A dealer is free to charge whatever he likes for a new or used vehicle. You, as a consumer, are free to look elsewhere if you believe the price a given dealership is charging is too high. If a dealer continually prices his vehicles out of what the market will pay for them, he most likely won't be in business for long.

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Can You Purchase a Car Mid-Lease?

You can purchase a vehicle in the middle of a lease contract or trade it to a dealership to pursue another purchase. Financing or trade obstacles may exist because of the vehicle's equity. Consider the benefits and disadvantages of purchasing a car in the middle of its lease so you can decide if it is financially beneficial.

Buyout Price

Call your leasing bank to find out your leased vehicle's buyout price. The price is often equal to the number of monthly payments you have left and the lease buyout amount, which is stated in your lease contract as the last payment. A dealership can do the same if you plan to trade the car toward another purchase. In the event that you trade the car, you can transfer negative equity to your new car's purchase price. If you owe less than the vehicle's purchase price, you can put the credit toward your new purchase as a down payment.

Value

Purchasing the lease may not prove worthwhile if you owe significantly more than the vehicle's current value. Depending on the vehicle's negotiated price when you initially leased it, the amount of payments you made and your leasing term, you may have too much negative equity in your car to finance it or trade it in. After you have the car's purchase price, check retail values. Edmunds.com or the Kelley Blue Book website offers vehicle appraisal tools. Use the guides to access your vehicle's suggested retail pricing.

Financing Issues

If you are upside-down in your car, you may have difficulty obtaining a loan for the lease purchase price. In this event, you likely have to offer a down payment to decrease the car's negative equity. If you apply to finance the leased car, make sure you note all of the vehicle's options. Banks decide vehicle lending amounts based on value, which increases when the vehicle has more features. Be sure to note vehicle features such as leather, a sunroof, alloy wheels, a navigation system or DVD player before you pursue financing.

Disadvantage

Depending on the current market value of your vehicle, it may not make sense to purchase it. Most lessees initially pursue a lease based on its monthly payment, not the vehicle's overall price. Because it is likely you leased the vehicle at or close to its sticker price, a down payment is likely necessary. Checking the sales price of other like vehicles can help you to determine if the purchase is worthwhile. Most states do not charge tax on the total price of a leased vehicle, so expect to pay taxes on your purchase price as well.

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How to Apply for Vehicle Finance

Many people finance to own a reliable vehicle that they may not be able to afford otherwise. If you're buying from a dealership, they can handle your financing, as most dealers use a variety of banks. Once you choose your car, the process of applying for a loan is rather straightforward. Know which information you should have on hand to apply for a vehicle loan.

Instructions

1

Gather information for the vehicle you want to purchase. If buying from a dealership and applying for a loan elsewhere, ask for a buyer's order, which will list the information needed for an application. Otherwise, have the vehicle identification number (VIN), year, make, model, level, odometer reading and selling price ready to provide to the bank.

2

Check the vehicle over for extra options, as bank values depend not just on the basic vehicle information, but how well it is equipped. Note the following options: alloy wheels (not hubcaps), leather, sunroof, spoiler, DVD player, navigation system, power windows and any additional options you find. If using a dealer and applying elsewhere, ask for vehicle options to be listed on your buyer's order.

3

Get your paperwork ready to provide with your application. Bring your driver's license, proof of income (most recent pay stub or tax forms) and proof of residency (a recent electric, water or cable bill in your name). If planning to purchase from a dealer, you'll also need this information.

4

Go to the bank or dealer you plan to apply to. Speak with a representative, who will take your application. Give the representative all of your vehicle information (not necessary at a dealership) and let her know that you have your proof of income and residency ready.

5

Fill out the credit application, providing your name, address, phone number, date of birth and Social Security number. Provide your address, how long you've lived at it, and your monthly rental or mortgage payment, if any. State your employer, time on the job, business phone number and gross annual income.

6

Sign your credit application. Let the representative know if you plan to put money down toward your loan.

7

Go over your options with your potential lender. Decide on the best term that both fits your budget and your plans to pay off the car. You can take out as little as a 12-month loan or as much as an 84-month loan at some banks -- have the representative run different monthly payments.

8

Wait for your notification of approval. If using a dealership, this process is either instant or can take up to an hour. Under special financing circumstances, such as poor credit issues, the process can take days. If using an outside bank, your approval will either be instant, or can take up to several days for official approval.

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How to Downsize a Car With a Loan

Many people struggle with their car payments because of the downturn in our economy. It is possible to downsize their vehicle and reduce their payment. The current vehicle needs to be appraised by a reputable dealer and paid off to remove the lien on the title. By purchasing a smaller and more fuel efficient vehicle, money will be saved in the long run.

Instructions

1

Arrive at the dealership prepared with the bank name, account number and payoff amount. Time will be saved with this necessary information needed for the dealership to pay off the loan.

2

Drive your current vehicle to the dealership to be appraised. Have the vehicle in clean and good working condition for maximum trade value. Money will be deducted for any damage or obvious mechanical defects. By researching the trade in value on one of the many web sites on the Internet there is more bargaining power. Be educated on the trade in value and pricing on new vehicle

3

Choose a less expensive vehicle that meets your needs.The less the replacement vehicle costs, the lower the payment is going to be. Downsizing to a smaller and fuel efficient vehicle will help accomplish the goal of reducing the cost of ownership.

4

Prepare yourself for the facts. Salesperson will calculate the numbers after the replacement vehicle is chosen and present the new payment. If there is inequity between what the trade is worth and what is owed, the payment may not go down much. Evaluate the situation and decide if downsizing is the best move. If there is equity in the trade, it is very possible payment will be reduced. Overall costs will go down and mission will be accomplished.

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