i just recently brought a nissan 06 sentra. Its a nice car but i want something bigger (the new 07 chevy impala). I am looking to keep my new sentra for a year in order to show a consistency in payments to make my payment history look good. After that year when i go to trade my sentra in for the next car, will the money i have already paid for the sentra go to the cost of the next car? How does it all work?
2006-10-27 04:54:19 · 10 answers · asked by byrdman26 1 in Cars & Transportation ➔ Car Makes ➔ Nissan
first, stick with foreign cars. nissan is a great company, and if u want more room, go with an altima or maxima for a sedan. when u trade in a car, they give u money for what its actually worth, and then u can use that to buy your new one IF u buy it from the place u traded it in. good luck whatever u do.
2006-10-27 04:57:30 · answer #1 · answered by SLP fanatic 3 · 0⤊ 0⤋
Sorry, it doesn't work that way. Car company finance departments and banks make their profit during the first 3 years of a car loan.
Most car loans are structured where you pay mostly interest in the front years of the loan (and very little to pay off the prinicipal.) Not until the last 1 or 2 years of the loan will you start paying off the majority of the principal.
(Unless you got a car loan from a credit union - those loans are more friendly to you.)
You need to ask your lender for a payment analysis showing your payments, and how much goes to interest and principal each month. It's also called an amoritization schedule.
The worst part about a new car loan is that the value of the car is dropping every month - you can lose as much as 25% of the value of a new car as soon as you drive your new car off the dealer's lot, and it continues to drop. In that case, you are not building any equity in the car until the loan is nearly paid off - 36, 48 or 60 months in the future.
In the car business, they call being 'upside down' - when you go to trade in your car, you owe more money on the loan than the car is actually worth as a trade-in.
Wish I had better news.
2006-10-27 12:04:36 · answer #2 · answered by Tom-SJ 6 · 0⤊ 0⤋
Depending on the vehicle you purchase,In your case an '06 Sentra.You lost about 6 grand the moment you drove it off the lot.When you go to trade it in next year the amount you get for it will be used to pay off whatever finance charges you owe.
A dealer is not going to give you even close to wholesale "Blue Book" value.Because he will take that vehicle and sell it for as much profit as possible.Basically,when you buy a car get the lowest interest rate possible,service it regularly(keep records) and don't spend over you're means.The purchase of a brand new vehicle is never an investment,As it just goes down in value.
2006-10-27 12:06:19 · answer #3 · answered by grandeweso1 2 · 0⤊ 0⤋
They look in the Kelley Blue Book to figure the trade-in cost of your car, in this case the 2006 Nissan Sentra. They take the asking price of the new car, minus the trade-in value of your "old" car and arrive at the amount that you need to finance. If you have an outstanding loan on the "old" car, any negative difference between that loan amount and the new loan amount is tacked onto the new loan. For example ...
You pick out a "new" car worth $30,000.00 USD
Your "old" car is worth $15,000.00 USD in trade.
Making the finance amount for the "new" car is $15,000.00 USD.
You have a loan on the "old" car with a pay-off value of $20,000.00 USD.
The loan on the "new" car would be $20,000.00 USD because $15,000.00 USD for the "new" car, plus the $5,000.00 USD difference between the trade-in value and the loan value on the "old" car.
2006-10-27 12:04:23 · answer #4 · answered by kc_warpaint 5 · 0⤊ 0⤋
most of he time if you buy while still in the red you lose. you first payoff the first car then you trade it in . then you buy the next one.when borrowing money the bank gets the bulk of the interest the first few years so when u buy a car most of what u pay the first year is interest .so there is little or no equity plus the value of the first car will go down. not a good move.
2006-10-28 23:36:09 · answer #5 · answered by dana 1 · 0⤊ 0⤋
When you trade in a car, it has a "book value" based on the year, make, model, accessories and millage.
If you trade it in to a dealer you should get that amount, more or less. You could take it in cash or put it on a new car.
Get an idea of how much it will be worth here --> http://www.kbb.com/
2006-10-27 12:03:45 · answer #6 · answered by DanE 7 · 0⤊ 0⤋
hello when you go to trade in your car they will need the amount of what the cost to payoff your loan. so if you owe 6000 they will pay the remainder off but you will end up adding your payoff to the top of your new loan. depending on what you choose and how much its worth
2006-10-27 11:59:50 · answer #7 · answered by biddixis1 1 · 0⤊ 0⤋
No.
The value of the car is applied to the loan..
the amount of money you owe on the old loan is aslo applied to the new car loan.
2006-10-27 22:06:30 · answer #8 · answered by Anonymous · 0⤊ 0⤋
the value of the car at the time you sell it is what its worth...not the amount you paid for it when you bought it
2006-10-27 11:56:51 · answer #9 · answered by michael m 2 · 0⤊ 0⤋
yes it should take off what you paid on the other vechile.
2006-10-27 12:00:59 · answer #10 · answered by texasrose7855 1 · 0⤊ 0⤋