Yes. You can trade a car with a loan. Ask your lender how much you owe, and then plan how you will pay off the loan with positive or negative equity. If it’s positive, you can pocket the excess. If you will owe more money than what the car is worth, that’s negative equity. You’ll need to determine what option works best for you financially for paying off the loan, whether paying cash, taking a loan to cover the amount, or trading in the vehicle at a dealership.