Selling and Part Exchange
Selling a Motorbike With Outstanding Finance: What You Need to Know
Can you sell a bike that is still on finance? What a settlement figure is, why buyers check, and the safe ways to sell or part-exchange.
Many riders want to change bikes before their finance ends. It is possible, but the finance has to be dealt with properly, and getting it wrong can cause serious problems for you and any buyer. Here is what you need to know.
Who owns the bike?
On many finance agreements, such as hire purchase, the finance company usually remains the legal owner until the agreement is paid off. That means you generally cannot sell the bike as if it were fully yours. Check your agreement for the exact terms, as they differ between lenders and products. Read our guide to HP vs PCP for how the main types work.
Why you cannot just sell it
If you sell a bike that is still subject to finance without settling it, the lender may still have a claim on the bike. That can leave the buyer in trouble and cause you legal and financial problems. It is never worth hiding finance from a buyer.
Get a settlement figure
Ask your lender for a settlement figure. This is the amount needed to pay off the agreement in full on a given date. It can differ from what is left on your monthly payments, and fees or charges may apply, so ask for it in writing and check how long the figure is valid.
Why buyers check
A vehicle history check shows outstanding finance. Sensible buyers, and all good dealers, run one. A buyer who purchases a bike with finance still owing can face serious problems. Be open with buyers and never hide it. Our buying checklist explains why history checks matter.
Your options
- Part exchange at a dealer: the dealer can pay off your finance from the value of your bike. If the bike is worth more than you owe, the difference can go towards your next bike. See our guide to using part exchange as a deposit.
- Settle first, then sell: pay off the finance yourself, then sell with a clear history. This is the simplest for a private sale, if you can afford it.
- Private sale with the lender's help: some lenders will take the sale proceeds directly to settle the debt. Ask what they require and how the process works.
If the bike is worth more than you owe
This is called positive equity. After the finance is settled, the difference is yours, and can be put towards your next bike.
If the bike is worth less than you owe
This is called negative equity. You will need to cover the difference, or in some cases it may be added to a new agreement, which increases what you owe. Work it out before you commit to a new deal.
Voluntary termination and early settlement
In some circumstances you may have the right to end certain agreements early, and early settlement can reduce the interest you pay. The rules depend on your agreement and how much you have paid, so check with your lender or get independent advice, such as from a free money guidance service.
Steps to take
- Read your agreement to understand the terms.
- Ask your lender for a written settlement figure.
- Get a valuation for the bike.
- Compare the value with the settlement figure.
- Choose how to sell: part exchange, settle first, or a lender-assisted sale.
- Keep all documents and confirmation that the finance has been settled.
Selling your bike
Once the finance is clear, see our guide to selling or part-exchanging your bike for how to prepare it and get the best price.
Frequently asked questions
Can I part exchange a bike on finance? Yes. The dealer can usually settle the finance from the value.
How long is a settlement figure valid? It is usually valid for a set period. Ask your lender.
What if I cannot afford to settle? Contact your lender early to discuss your options.
Ask the DH Superbikes team if you want to talk it through.
This article is general information, not financial or legal advice. Check your own agreement.
