---
id: department-0025
title: "What happens to my existing car loan when I trade in my vehicle?"
category: department
subtopic: trade-in
page_type: department
source_url: "https://www.castlecadillacmchenry.com"
tags: ["trade-in", "financing", "used-vehicle"]
questions:
  - "Can I trade in a car I still owe money on?"
  - "How does a trade-in work if I have an outstanding loan?"
  - "Will Castle Cadillac McHenry pay off my loan?"
  - "Do I need to pay off my old loan before trading in?"
related: [trade-in-value, finance-approval, used-sales]
dealer: Castle Cadillac McHenry
---

Yes, you can absolutely trade in a vehicle with an outstanding loan-this is very common. Here's how it works: Castle Cadillac McHenry will assess your trade-in vehicle's current market value. If that value is greater than what you still owe, the difference becomes credit toward your new purchase. If you owe more than the vehicle is worth (being 'upside down'), our finance team can work with you to roll that amount into your new loan, subject to approval.

Our finance professionals handle the paperwork, including contacting your current lender to pay off the loan from the trade-in proceeds. You won't have to manage that directly-we take care of it.

**Ready to get started?** Call us at (779) 265-4427 or visit **https://www.castlecadillacmchenry.com** to discuss your trade-in and explore your new-vehicle options. We're here to make the process smooth and straightforward.