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Old 03-16-2011, 03:41 PM   #1
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How long does it take for the dealer to actually pay off the car you trade in?

I needed a commuter car so I traded in my G35 for something much more fuel efficient. It's been nearly 3 weeks and I still have the balance on my G35 with a payment due in about 3 days. I'm going to give the dealer a call to see what's the deal but would like to get some input.
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Old 03-16-2011, 04:19 PM   #2
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Generally, they won't send the check out until they get funded/paid on the car you bought from the bank. That check is usually over nighted, and the bank usually takes about a week to process it. It usually is a 2-3 week process if everything funds promptly, if they don't get paid on their car they won't pay yours off.

And some dealers, the shady ones I'm sure, may not be so prompt. Where did you buy it? The worse your credit is the longer it takes to fund generally. I used to do finance so if you have any other questions just let me know.
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Old 03-16-2011, 04:24 PM   #3
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My car is actually a lease from Nissan(not going to want it 3 yrs from now). Everything you said made sense and now I'm thinking they are going to wait to sell it before they pay off my balance. God knows when that will happen.
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Old 03-16-2011, 04:26 PM   #4
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That is illegal.

Edit: The second they receive funds, they need to send your payoff out. Want to find out if it was sent? Call them and ask for the tracking number. Call Nissan Finance and ask if it's been received and/or processed. Call the bank you signed with (new loan) and see if your loan has been paid to the dealer. Etc. The dealer can't hold out to sell it prior to paying it off.
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Last edited by chrislis; 03-16-2011 at 04:28 PM.
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Old 03-16-2011, 04:33 PM   #5
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That is illegal.

Edit: The second they receive funds, they need to send your payoff out. Want to find out if it was sent? Call them and ask for the tracking number. Call Nissan Finance and ask if it's been received and/or processed. Call the bank you signed with (new loan) and see if your loan has been paid to the dealer. Etc. The dealer can't hold out to sell it prior to paying it off.

I actually called the finance co this morning and they said they have no record of the car being paid off by the dealer. Even though I leased a car and traded in my car so they can wipe off the debt, they have to pay off the loan as soon as possible?

Just want to make sure I have these points correct before giving them a call.

Last edited by MB Guy; 03-16-2011 at 04:38 PM. Reason: Sorry meant the finance co not the dealer
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Old 03-16-2011, 04:43 PM   #6
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Read your contracts. When the dealership is paid by the bank on your new purchase they have received funds for three things which are as follows:

1. To cover their cost and profits on the car they sold.
2. To pay off the existing loan on the car in which you traded in.
3. To pay for all additional accessories, warranties, taxes, registration, and/or aftermarket products.

Now go through your bill of sale. There should be an "amount financed" line at the bottom. This includes all charges that roll into your new loan. Look for your trade lines. There should be a "Trade Allowance" spot in which they have the number your car was given to the dealership for. Another line will have "Balance owed on trade" which is how much the dealership is responsible to pay as soon as they receive funds on your new car.

Just think of it like this.

Dealership sells you car for $10,000.
Your car is worth $2,000.
Balance is now $8k.
Payoff is $4,000.
Balance is $12k.
Bank forwards dealer $12k.

Do you see what just happened? Your payoff is in your new loan.
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Old 03-16-2011, 05:59 PM   #7
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Just a heads up-its not illegal (no law has been broken) to attempt to sell a car (especially a lease rtn) prior to paying it off-its just poor etiquette.
MN has a 7 day rule-from the time of trade in (on the contract) to the time the payoff check has to be cut to the lender being paid off.
As for the above-yes-there may be neg equity-but we dont know the specifics of the purchase order (trade value, purchase price, pay off, fees) to determine if his debt was zero'd or not-prob not considering youre terming a lease early.
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Old 03-16-2011, 09:26 PM   #8
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Thanks for the replies. I wasn't aware that the car that is leased is also financed. I figured it was just a rent a car type of deal.
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Old 02-17-2012, 11:00 AM   #9
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New Car Purchase with Trade In - Lien Payoff

Any help?

I just purchased a vehicle and traded in my car that I still owed on. The contract shows total sale of car, traded in value given, and amount still owed on trade (lien) with all fees etc.. They let me leave with the new car and wrote the contract for 1.9%. My credit is not good and I am worried because my trade in is for sale already and my bank has not received the payoff yet. I guess I am a little worried that they will sell my trade-in and if the financing does not go through, they will take back the new car leaving me with nothing and a payment on my old car still. Should I be concerned about this? Any help would be appreciated.

Thanks
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Old 02-19-2012, 07:37 PM   #10
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It took a little over 2 weeks for MB Financial Services to receive the payoff when I bought my Range Rover. It was coming close to my payment date so I made a payment just in case. They sent me a refund a week after the payoff.
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Old 02-19-2012, 07:37 PM
 
 
 
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