Can I sell this?
By: Alex Rechenmacher

In a pinch, many people find a convenient source of cash in selling off a few of those assets that are no longer being used, or don't work as well as they once did. But is there any harm to be found in using this method to make a few bucks? As it turns out - maybe.

Although it may go without saying, a common trap that plagues many is the fact that they may not own the item they wish to sell. Only the owner of property has the right to sell it or, if necessary, destroy it. Sometimes, consumers make the mistake of thinking that they own something, when really they have only paid for the right to use the item, as is the case with a lease or a license.

Another problem is the misconception that getting rid of the property relieves your obligation to a lender. Especially in recent years, more and more consumers take out financing to purchase many of the items in and around their home. Just as a home cannot be sold without payment to the underlying mortgage lenders, consent may be needed to sell less obvious items.

Financing is commonly used to purchase vehicles, electronics, furniture, jewelry and other items. Just because you have sold the item to a friend, relative or eBay customer, unfortunately does not mean that you will no longer have to pay on your loan. The lender may repossess the property or may sue you for the balance of the payments.

So be careful when you sell that TV or lemon of a car to make sure that you own it, and have the right to sell it “free and clear” of any security agreements, lien rights or other similar encumbrances.