UAE | General
Check your loan status before selling vehicle
If you are planning to sell your car in the UAE, be aware that if you have taken out an auto loan with a bank, the car technically belongs to the bank.
- By Alice Johnson, Staff Reporter
- Published: 00:04 August 2, 2008
- Image Credit: Gulf News Archive
- It is important to keep your car's interior and exterior clean before you find a prospective buyer.
Dubai: If you are planning to sell your car in the UAE, be aware that if you have taken out an auto loan with a bank, the car technically belongs to the bank.
As the registration transfer to a new driver needs to be undertaken with no outstanding finance (after the loan is settled), this proves a problem with selling your car.
There are a couple of solutions to this issue. One is to take a personal loan instead of an auto loan. This means that the car technically belongs to you and you can sell it at a time of your choice.
However, auto loans generally offer lower interest rates.
Some used car dealers also offer to refinance the bank and de-register cars, offering a second solution.
If you do want to sell your car and there is an outstanding amount on an auto-loan, the balance (also called 'mortgage') can be transferred to the new owner. This will be arranged with the finance provider.
According to a leading auto loan provider, you technically have to settle the balance of the loan before you can sell the car. This can be done through the 'mortgage' transferrable to the buyer, who will settle the loan amount.
Be aware that if you have taken out an auto loan, you are likely to still be charged for the interest calculated on that loan.
However, it is best to check with your finance provider before taking any steps or advertising that your car is for sale.
Cars older than 10, 15 (1993 or before) and 20 (1988 or before) years are also subject to regulation. Transfer of ownership/registration cannot be made on cars that are this old in the future.
According to recent Ministry of Interior announcements, cars older than 20 years cannot have their registration renewed from December 1, 2008. Cars older than 10 years will not be allowed to transfer registration from January 1, 2009 and for cars older than 15 years, regulations will be enforced from January 1, 2010.
If you want to sell your car privately, you are allowed to advertise in the newspaper or display an advert on authorised notice-boards, but it is illegal to stick a notice in your car window advertising its sale.
Gulf News has a large daily classifieds section with many cars for sale advertised.
Lastly, make sure your car is washed on the outside and clean on the inside, with no strong smells from the interior.
Do not offer to take a buyer on a test drive unless you are comfortable with the situation.
Outstanding traffic fines or tickets need to be cleared before you sell the car - this can also be done by the buyer, but you will need to finance the fines.
check list: Tips for selling your car
- Consult your finance provider to gauge the situation on your auto loan
- Pay any outstanding fines or tickets
- Advertise your car's sale in authorised places, such as Gulf News classifieds section or shop notice boards - NOT on the car itself.
- Take the vehicle to a car wash or valet service, to attract buyers.
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