If you want to sell your financed car in UAE, you must first grasp the process and manage the laws and restrictions. To achieve a seamless and successful transaction, selling a financed car necessitates careful planning and attention to detail.
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What Is A Financed Car?
Financed car is one that was acquired with the help of a loan or financing agreement, in which the buyer borrows money from a lender to pay for the car and agrees to return the loan with interest over a certain period of time. Many people in UAE choose to finance their car purchases through banks or other financial organizations since it allows them to spread out the cost of the vehicle over time rather than making a lump sum payment upfront.
It is crucial to understand, however, that when a car is financed, the lender normally holds possession of car as collateral until the loan is entirely paid off. This implies that the borrower is responsible for making regular loan payments and following to the terms and conditions of the financing arrangement. The outstanding loan amount and legal requirements related with the financing agreement must be handled in sales process when selling a financed car in UAE.
Pay The Loan
Paying off the loan is one of the simplest things to do if you’re selling a vehicle with bank financing. After paying all your debt:
- Check that your bank has notified the RTA of the debt clearing. It might take a few business days to be notified.
- The bank should provide you with an official release letter. It is an important step that many car owners are unaware of.
Look For A Finance Buyer
If you are unable to pay off the balance, here are several options for selling Your Financed Car
- Look for a buyer that can finance the car through the same bank as you have financed.
- Notify the bank that you have a buyer and transfer the loan to their account. This policy is not followed by all banks, However, Emirates NBD, Noor Bank, and Dubai Islamic Bank do. As a result, it’s critical to verify with the bank to see if this alternative is doable.
- Request that the buyer begin a loan application and obtain approval from your bank.
- They will also need a valuation certificate to establish that the loan is based on the car’s worth.
- If you have requested a price that is greater than the outstanding debt amount, request that the bank clear your balance using the buyer’s loan. An early settlement charge (often 1% oaf the loan amount) might be added to the debt.
- You must then transfer vehicle ownership to an RTA or Tasjeel center. – (Guide To Tasjeel)
- The buyer must supply the bank with their new registration card and a copy of the insurance policy as evidence of ownership before the loan can be closed.
Buyers must have valid car insurance, a passport, a residence visa, and a driver’s license from the United Arab Emirates.
The vendor must assess the car’s value and supply all necessary documents and papers. Furthermore, the vendor must provide a free and fair automobile inspection report.
There are various advantages to purchasing a financed car in UAE. Lower loan rates some firms even offer 0% interest rates, monthly payments, and depreciation can all be obtained. You also do not need to put anything up as collateral. Your collateral is the car itself. To meet your demands, the bank provides a variety of convenient payment methods.
If a car is financed by a bank, it cannot be sold unless one of the aforementioned procedures is used to clear the debt.
To ensure that the cars is operational, you must perform the car test. AED 150 is charged for car testing. If the car passes the test, RTA will issue a certificate.
Find A Buyer Who Will Pay By Cash
Another alternative for selling a financed car is to locate a cash buyer who would pay off the debt to the bank on your behalf. However, you must promise the buyer that they will receive ownership of the car after the remaining loan amount is paid off. You will need to apply the following things to do this:
- Inquire with the bank about the outstanding loan balance and any early settlement costs for ending the loan before the entire term is completed.
- Sign a Power of Attorney or a seller’s agreement granting the new buyer the ability to transfer the car to their name after the bank loan is paid off.
- You must go to the bank with cash or a certified manager’s check for the value of the car. The buyer can clear the debt by paying the outstanding amount at the bank.
- Once the bank electronically notifies the RTA of the loan clearance, the buyer must visit the RTA to finalize the transfer procedure.
Go For An Auto Loan Payout
Another simple alternative for selling a car on loan in Dubai is auto-loan payout. AUTO SWAP is an effective financing solution provided by Emirates NBD. Vendors can sell financed autos in Dubai without having to return their obligations. This feature enables the buyer to acquire a fresh loan to fund the transaction.
Here’s how to use AUTOSWAP:
- Please visit Emirates NBD website.
- Select Personal Banking, then Auto Loans, and finally AUTOSWAP.
- Enter your name, email address, and phone number.
- Mention the car’s age.
- Apply
Things To Consider Before Selling Your Financed Car In UAE
- A car purchased with bank financing can only be sold if the debt is cleared via the methods described above.
- A car test must be completed by the seller to guarantee that the vehicle satisfies all criteria and is fully functional. The charge for vehicle testing in Dubai is AED 150. For additional information, see our guides on car testing centers in Dubai and RTA vehicle tests.
- The RTA will provide a clearance certificate if you pass the vehicle test.
Here are some of the tips and law for selling your car. These guidelines can assist you in determining how to prepare your car for sale.
Conclusion
This concludes our tutorial on How To Sell Your Financed Car In UAE. If you’re selling a car in UAE for the first time, make sure you’re informed of all your alternatives. Furthermore, prospective purchasers who do not wish to obtain a bank loan can buy used cars in Dubai, UAE, or any other UAE Emirates through Cars Club. From high end used Mercedes Benz and BMWs to low cost used Nissan, you’ll find a wide range of used vehicles here. Make sure you are informed of UAE traffic fines before acquiring a car.
Check out UAE’s top auto blog for more information about the automotive industry.
