1. Where is the registration certificate?
If you finance a car with a loan, you often never even see the registration certificate Part II (Zulassungsbescheinigung Teil II, formerly Fahrzeugbrief). Many banks have the vehicle transferred to them as security, known as a transfer of ownership by way of security (Sicherungsübereignung). You drive the car, you are registered as the keeper and you pay the instalments, but the bank keeps the certificate until the loan has been repaid in full.
This matters for the sale: without Part II, a buyer cannot register the vehicle in their name. And as long as the bank holds ownership as security, you are generally not allowed to sell the vehicle without its consent. So the route always goes through the bank.
Not every loan is secured this way. If you paid for the car with a general-purpose personal loan and the certificate is at home with you, the sale is usually a perfectly normal sale in legal terms. You then either keep paying off the loan separately or settle it with the proceeds.
2. Check the loan agreement
Before you sell, it is worth looking through your paperwork. Pay particular attention to these points:
- Has the vehicle been transferred to the bank as security, and where is the certificate?
- How high is the current outstanding balance?
- Is there a final balloon payment, as with balloon or three-way financing?
- What does it say about early repayment? With consumer loans, the bank may under certain circumstances charge an early repayment fee, the amount of which is capped by law.
If you are unsure, ask your bank directly. Customer service can tell you what applies to your agreement.
3. Request the settlement figure
The most important step is the settlement figure. This is the amount that will fully clear your loan on a specific date, including interest up to that day and any charges. Most banks issue a written settlement statement for this, often with a validity date, because the amount changes every day.
With this figure you know how much of the sale price is left for you after the settlement. If the sale price is below the outstanding balance, you have to pay the difference out of your own pocket, otherwise the bank will not release the certificate. Plan for this before you sign a purchase agreement.
4. How payment works
In practice there are two usual routes:
- You settle the loan yourself. You transfer the settlement figure to the bank, the bank sends you the certificate, and you then sell the vehicle like any other. This is the simplest route, but it requires you to be able to raise the amount temporarily.
- The buyer pays the bank. Part of the purchase price goes directly to the bank, namely exactly the settlement figure. You receive the rest. Once payment has been received, the bank releases the certificate, to you or to the buyer, depending on what has been agreed. It is important that everyone involved records the order of steps in writing beforehand.
Depending on the bank, it can take a while for the certificate to arrive. So clarify in advance when the vehicle will be handed over and when it will be deregistered.
5. Special case: leasing
A leased vehicle does not belong to you but to the leasing company. That is why you cannot simply sell it. If you want to leave the contract early, talk to the leasing company about whether an early settlement is possible and on what terms.
6. Tips for a safe sale
- Tell the buyer from the start that the vehicle is still financed. That builds trust.
- Have the bank's settlement statement ready.
- Only hand over the vehicle once payment has been sorted out.
- Inform your insurer about the sale.
If the certificate has been lost rather than being held by the bank, read our guide Selling a car without the registration certificate. The other papers you need are listed under Documents for selling.