Car loan payout letters: how to get and read one before you sell
Key takeaways
- Ask your lender for a payout figure valid for the day you expect the sale to settle, and use that figure instead of the balance in your banking app.
- For a car loan taken out mainly for personal use, the National Credit Code gives you a right to a written payout statement within 7 days of a written request, itemised if you ask.
- Moneysmart says variable-rate car loans usually have no early exit fee. On a fixed-rate loan, check your contract and the itemised letter before you compare offers.
- Your equity is the sale price minus the payout figure. The lender is paid first, and whatever is left over is yours.
Ask your lender for a payout letter: a written statement of the exact amount needed to close your car loan on a set date, including interest to that date and any fees. For a car loan taken out mainly for personal use, the National Credit Code requires the lender to provide it within 7 days of a written request. Whether the figure includes an early exit fee depends on your contract: Moneysmart says variable-rate car loans usually don’t have one, so fixed-rate loans are the ones to check closely.
This guide covers how to request the letter, what each line on it means, who gets paid first when the car sells, and how to turn the letter into an equity figure, using a worked example with made-up numbers.
Why isn’t the payout figure the same as the balance in my app?
The balance in your banking app is a snapshot. The payout figure is what the lender needs to close the loan on one particular day. It can include things the app balance doesn’t show yet.
- Interest up to the payout date. Interest keeps building between repayments, and the payout figure adds it up to the day the lender expects to be paid.
- Fees for closing the loan early. Some contracts charge an early termination fee or break cost. If yours does, it is added to the figure.
- Missed amounts or other fees. Anything overdue on the account is part of what has to be cleared.
A repayment that is still being processed can also make the two numbers differ. If your loan has a balloon or residual payment, the payout figure includes that lump sum even though it isn’t due until the end of the term. The practical rule is simple: when you work out what you would walk away with from a sale, use the payout figure, never the app balance.
How do I ask my lender for a payout letter?
You can usually ask by phone, and many lenders also take requests through online banking or their app. Some call it a payout quote, payout statement or payout figure. Whatever the name, ask for the same things:
- A payout figure as at a specific date. Pick the day you expect the sale to settle. When you sell to us, a car under finance usually takes 2 to 3 business days to settle, so allow for that.
- An itemised breakdown. A single total hides whether there is an early exit fee. Ask how the amount is made up.
- Payment instructions. You need to know how the lender wants to be paid and which reference to use, so the money lands on the right loan.
- Your loan account number on the letter. It saves confusion when someone else pays the lender at settlement.
If your car loan is a consumer loan covered by the National Credit Code, you have a legal right to this statement. Under section 83 of the Code, if you ask in writing, the lender must give you a written statement of the payout amount as at the date you choose, within 7 days. If you ask, it must also list the items that make up that amount, and the statement must say the amount may change depending on the day it is paid. Lenders often answer faster than 7 days, but the 7-day rule applies to a written request, so keep a copy of yours. The Code covers loans mainly for personal, domestic or household purposes, so if the car is financed through a business, ask your lender what its process is.
You don’t have to do this alone when you sell to us. Ask your lender for a payout figure, or give us permission to request it on your behalf.
What does each line on the letter mean?
Lenders lay their letters out differently, but most show some version of the lines below. Read them in this order.
| Line on the letter | What it means | What to check |
|---|---|---|
| Payout amount | The total needed to close the loan on the stated date | That this, not your app balance, is the number you use |
| Valid until (or payout date) | The last day the figure holds | That it covers your likely settlement day |
| Balance outstanding | What you still owe before interest to date and closing fees | That it roughly matches your latest statement |
| Interest to payout date | Interest from your last repayment up to the payout date | The date it has been calculated to |
| Early termination fee or break cost | A charge some contracts make for closing early | Whether your contract allows it, and the amount |
| Other fees or arrears | Anything overdue or still owing on the account | Any item you don’t recognise |
| Payment details | The account and reference the lender wants used | Confirm them by calling the lender on a number you already have |
Check the valid-until date before you rely on the figure. Interest keeps adding up while the loan stays open, so the figure only holds until the date on the letter. If the sale settles after that date, the old figure is out of date. Ask the lender for a fresh one rather than estimating the difference.
Will I pay an early exit fee?
It depends on how your loan was set up. Moneysmart’s car loans guide says: “Variable rate car loans usually don’t have an early exit fee.” It doesn’t say the same of fixed-rate loans, which may charge one, and early repayment fees vary from lender to lender.
| Your loan | Early exit fee? | What to do |
|---|---|---|
| Variable rate | Usually none, says Moneysmart | Confirm it on the itemised letter |
| Fixed rate | May apply, and varies by lender | Read the fees section of your contract, then check the letter |
| Loan with a balloon | Depends on your contract | Check the balloon is in the payout figure and look for any fee line |
| Novated lease | A different arrangement | Talk to your employer or the leasing company about the payout and any fees |
If you are not sure, ask the lender one direct question: “Is there any fee for paying this loan out on [your settlement date], and how much is it?” Get the answer in writing on the payout letter.
A fee doesn’t decide the sale on its own. It comes off what you walk away with, so include it when you compare a sale against keeping the car. If a balloon is about to fall due, our guide on whether to pay, refinance or sell when a balloon payment is due walks through that choice.
Who pays the lender when the car sells, and in what order?
The lender is paid first. With a secured car loan, the lender usually registers a security interest over the car on the Personal Property Securities Register (PPSR) until the loan is paid in full. The full payout figure has to reach the lender before the loan can close and that interest can be released. Whatever is left of the sale price after the lender is paid is yours: that is your equity. Our guide to finance showing on the PPSR explains what happens to that record after a payout.
How that plays out depends on who is buying.
| Step | Private sale | Selling to us |
|---|---|---|
| Getting the payout figure | You request it and show it to the buyer | You request it, or give us permission to |
| Paying the lender | The buyer pays the lender, or you arrange it between you | We deal with your lender directly |
| Your equity | The buyer pays you the difference separately | Paid into your bank account |
| Handing over the car | Only after the lender is paid and your share has cleared | Only after you confirm the funds have cleared |
In a private sale, a careful buyer won’t want to pay you while finance is still registered against the car, so agree up front how the lender will be paid. Some loan contracts don’t allow a private sale while the car is under finance, so read yours and tell your lender before you list the car. Some sellers hope a buyer can simply take over the repayments, but a car loan generally can’t be transferred, as our guide on whether a buyer can take over your car loan explains. When you sell to us, the lender side is our job. You can read how that works on our page about selling a car under finance.
When does the money left over reach me?
When you sell to us, we deal with your lender directly to pay out the loan, then pay any equity into your bank account. Cars under finance usually take 2 to 3 business days to settle, because the payout figure has to be confirmed with the lender and the loan paid out. Everything else works like any other sale: a genuine offer, a deposit, the inspection, the balance into your bank account, then collection only after you confirm the funds have cleared.
In a private sale, the timing is whatever you and the buyer agree. Get your share in your own account, and confirm the lender has been paid, before the keys change hands.
Worked example: reading one letter (illustrative numbers)
The numbers below are made up to show the arithmetic. They are not typical figures, a valuation or a quote for any car.
Sam is selling a car bought on a variable-rate loan. The banking app shows $27,340 owing. Sam asks the lender for a payout figure as at Friday 23 October 2026, the day the sale is expected to settle, and asks for a breakdown.
| Line on Sam’s letter (illustrative) | Amount |
|---|---|
| Balance outstanding | $27,340 |
| Interest to 23 October 2026 | $112 |
| Early termination fee (none in this contract) | $0 |
| Payout figure, valid until 23 October 2026 | $27,452 |
Sam has accepted an offer of $36,000 (also made up). Here is the sum.
- Sale price: $36,000
- Less payout figure: $27,452
- Equity to Sam: $8,548
Now change one thing at a time:
- Settlement slips past 23 October. The figure has expired, so Sam asks for a new one. The new figure adds the extra days of interest, and Sam’s equity goes down by that amount.
- The loan was fixed-rate with an exit fee. The fee appears as its own line, the payout figure rises by that amount, and the equity falls by it. That is why you read the breakdown before you compare offers.
- The accepted offer is $25,000 instead. Sam would be $2,452 short. The lender still has to be paid in full, so that gap has to be covered before settlement. Our guide to selling a car with negative equity covers the options.
Putting the letter next to a real offer
A payout letter answers one half of the question. The other half is what someone will genuinely pay for the car. Put the two together in our car equity calculator and you can see your equity, or the shortfall, before you commit to anything.
For the second half, you need a genuine offer. We are Sell Your Car Australia, run by Autohaus Australia Pty Ltd, a NSW licensed motor dealer (MD 077404). We buy cars, utes, SUVs and 4WDs 2021 or newer with 100,000 km or less, and if yours is older or has more kilometres, send it through anyway and we will tell you straight away if we can help. The valuation is free, with no obligation, and the offer comes by phone from a licensed dealer, not an online estimate.
If you go ahead, we deal with your lender, pay out the loan, pay any equity into your bank account and arrange collection anywhere in Australia once you have confirmed the funds have cleared. In Roy’s words: “They helped me through the transaction of a high value car and made it very pleasant. From paperwork and working with the lenders, to a personal touch.”
Have your payout letter handy when you call 1800 73 55 73, and you will know your equity as soon as we make an offer.
Questions sellers ask
Can a buyer get the payout figure from my lender for me?
Not without your say-so. The loan is in your name, so your lender will generally only deal with you or someone you have authorised. In a private sale, request the letter yourself and show it to the buyer. When you sell to us, you can ask your lender for the figure or give us permission to request it.
Will paying my car loan out early hurt my credit score?
Paying a loan out in full is not a missed payment or a default. Moneysmart says your credit report lists the credit accounts you have held in the last two years, with their opening and closing dates and whether you paid on time. It says your score is based on things like how much you have borrowed, how many credit applications you have made and whether you pay on time. You can get a free copy of your report every 3 months if you want to check it.
Should I keep making repayments while I wait for the sale to settle?
Yes. The loan stays open until the lender receives the full payout amount, so repayments are still due. Moneysmart says your credit report records missed payments, meaning payments not made within 14 days of the due date. If a repayment comes out after your letter was issued, ask the lender for an updated figure so the payout is right.
Is a payout letter the same as a PPSR search?
No. A PPSR search shows whether a security interest, such as a car loan, is registered against the car, but it does not show how much is owing. The payout letter comes from your lender and gives the exact amount. A careful private buyer may want to see both.
