How does a car trade-in work? I've paid about $4720 on my car so far. The car is about $33,000 total.?

Question

The car is like $22,000 and the financing is like $11,000(I know) which totals it out to 33K. Lets say I want to trade it in for a $18,000 car after I pay off the 11k in financing but my car is worth only 10-11K at that point what is my grand total gonna look like? I got screwed bad when I bought this car but I was only 22yrs. FYI, it's a 2.7L Dodge Magnum, freakin' 2.7L!!

Answer 1

When you are in a negative equity situation, like the one you are describing, you have to pay the bank the difference between what the car sold for (or the trade value if your trading it in) and the amount you owe.

Here's how it works. Take the amount of the car you want to buy. Subtract the value of the car you are trading in(the amount the dealer is willing to give you) and then add back any money you still owe on your trade.

New Car 18000
Trade in -10000
Balance 8000
Loan payoff +11000
New car price 19000

Answer 2

The dealer will give you the blue book trade in value for the car. He will deduct the amount of the loan payoff, and offer you that much for the trade in value of the new car. To find the payoff amount, just call the loan company and ask what it is. Sometimes they will offer you more, but they will charge you more for the new car.

You are better off selling the car yourself, and getting a fair value, and then take the money and use that for the down payment on a new one. Good luck.

Answer 3

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Answer 4

Wah