Selling car but not paying off loan

A

A_b

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Hi,

whats happens if you have a car loan with bank based on your current car but are downsizing and keeping the cash from sale for other purposes. Do you need to inform the bank or just continue paying car loan as if you have the car?

Thanks!
 
If it's a loan for a car, then as long as the bank continues to be repaid, they won't either be aware that you sold it or necessarily care. The car is your property and can't be repossessed even if you were to default on the loan.

On the other hand, if it was a hire purchase agreement, you don't have title to the car until the final instalment is made and it is not yours to sell, therefore, until this point.
 
I traded in my car on Tuesday and just paid the difference in cash. I am going to keep paying the loan against the old car, think it ends July 09.

I was able to do this as it was a personal loan for a car (any car) as opposed to an Agreement secured against a particular car.
 
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