A consumer can sell a car if they still owe money on it, but the balance must be paid in full to release any liens against the title. That's why car owners always want to sell a car for at least as much as the balance of the loan.
However, there are circumstances where the loan balance actually exceeds the worth of the vehicle or the amount it can be sold for. In these cases, the seller remains responsible for ensuring the loan is paid in full so the buyer can obtain the title. The seller must give the proceeds of the sale and any additional funds necessary to pay the car off directly to the lender.
Some sellers have the funds available in savings to cover the balance of the loan. Otherwise, sellers can take out a small personal loan to cover the remaining balance. Before selling a car that has a loan on it, one should make sure to contact the lender for an exact payoff amount. This amount is good for a specific amount of time, generally 10 days. Ensuring that the car is paid off during this period helps decrease the chances of having a small balance due.