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Can you sell a car on finance?

Securing a car on finance has become increasingly common in recent years, thanks to the popularity of payment plans to spread the cost. But can you sell a car on finance? Is it harder to sell this way? The answers might depend on your agreement type and who you want to sell with.

If you’re legally able to sell your vehicle, we make it hassle-free at Money4YourMotors. However, if you’re unsure whether your plan allows this, our motoring experts explain how the process works, and run through each agreement type here.

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Can I sell a financed car?

Yes, you can usually sell a financed car legally if you take the relevant steps for your payment plan (excluding Personal Contract Hire, which we’ll cover further down).

When you took out your finance agreement, it was likely done so under one of the following plans. Your finance provider can let you know which one you’re on.
• Personal contract purchase (PCP)
• Hire purchase (HP)
• Personal contract hire (PCH)
• Personal loan

For most of these options, you’re not the legal owner of the car until the finance has been paid off, so it’s important to understand how each plan works and how it affects selling your financed car.

Can you sell a car on PCP?

If your car was financed with PCP, you can sell it if all repayments have been made, including the final lump sum ‘balloon fee’, or, if you’ve agreed a settlement figure with the finance provider. The settlement usually includes remaining payments, interest accrued and the balloon fee, the latter of which is needed to own the car outright.

To sell your car privately, you’d legally need to pay off the remaining finance yourself beforehand, however, you can enlist our help, or that of a dealership, to buy your car and pay your provider directly. If the purchase offer covers the settlement fee, any other money goes to you. If not, you’ll need to pay the difference.

Can you sell a car on HP?

A car can also be sold if it is under HP (hire purchase). Unlike PCP however, there is no final balloon fee, so you will own the car at the end of your repayments.

Again, selling early during your plan requires a settlement figure, which like PCP can be agreed with your provider and brought to a car-buying service like ours, or a dealership.

Can I sell a car on PCH?

No, you can’t sell your car if it was ordered under personal contract hire. This plan is essentially a rental period, and so you don’t have the right to sell it.

Some providers may agree a fee for you to buy the car, but it is at their discretion to do so.

Can I sell a car bought with a personal loan?

Yes, if you ordered your car with a loan, it is yours to sell. Any debt will still need paying off, but you can sell with us, a private buyer or a dealership with more freedom. Money made from selling the vehicle can be used to pay off the loan, purchase a new car or otherwise; it’s your choice.

Selling a financed car FAQs

Is selling a car with outstanding finance illegal?

It is illegal to sell your car if you don’t own it. As we’ve highlighted previously, this is the case with several finance plans, so make sure you know which plan your car is under before selling, and communicate with your finance company if you do decide to sell.

What can happen if I sell a car with outstanding finance?

You can be asked to pay what is owed, and legal action is also possible.

Can I part exchange my car on a finance plan?

No, the car is not yours to part exchange until the outstanding finance has been settled (though again, some dealerships might be able to support with this).

Selling a financed car comes with its own challenges, but we make it easy to sell with us and aim to remove any obstacles that might occur during your sale.