trading a new car?

Question

if i buy a new 2006 car and i havent finish the payment yet but after 1 year i go and trade it for a used 2004 car at the dealer that cost about $8000. do i still continue paying for the new car i bought? or do the dealer deal with the payments and i only and pay for the used $8000 car?

Answer 1

Well, we need a little more info on this question like what is your current balance on the loan that you are paying on currently and how much your current car is worth. Then you would know if you owe more than your current car is worth. Either way, depending on the equity in the car, whether negative or positive, you would then adjust the 8,000 dollar price tag on the 2004 vehicle. No your payments on the 2006 car would not go away and it would be more like transferring the balance of the 2006 car minus what it's worth onto the 2004 vehicle. Hope this helps and it would be more helpful if you disclosed the vehicle year, make, and model of your current car and an estimate of you currently still owe on the loan.

Answer 2

When you trade in your new car, the price of your next car has the buyout price incorporated in the sale. But since you're buying a lesser (price wise) vehicle, there should be a balance due you. You can have the dealer process the payoff amount on your new car or you can do it yourself.

The price that you trade your new car in will probably take a loss since no dealership pays exactly what you had to pay for the car, plus in one year's time, the car has depreciated in value (check NADA book pricing as this is what dealers use). So if you're paying 18,000 for the new car, and have paid off 2,000 with a balance of 16,000 left, it is now worth 8,000 to the dealer. You still owe $8,000 on the new car which has to be paid before you can get the title to be transferred to the dealer. That means that the dealer can pay off the balance to get the title, and process another loan on the 2004 car. Be careful and if your credit is not great, check the percentage on the 2004 car. If it is higher than your previous loan, it will set you back some. Changing registrations, titles etc are fees which will be added to your next loan unless you have the cash to pay for it upfront.

I take it that you want to pay on a smaller loan rather than the larger one you already have. You can either get a loan on your own (Bank, best option: credit union) and then just paid the financial institution.

Do your research on carfax (get the vin number) to make sure it's not been in an accident which will cost you more repairs bills later. Good Luck.

Answer 3

It would be kind of like re-financing your old car loan into a new car loan. It is done every day, but it is difficult to do when you've only had your vehicle for a year and lenders don't often like to see inexpensive vehicles carry a lot of negative equity.

For the sake of financing--in the lenders' eyes--It would be really easy to do if you put a lot of money down when you bought your current car or if you have a substantial amount to put down now.

Here's a good way to think of it:

the price of the car you are planning to buy
- the value of the car you're trading in (dealer's value)
= trade difference (amount you pay taxes on)

+ balance that you owe on your trade-in
= amount you would be financing (the amount you are charged interest on, and what your payment depends on)

Answer 4

I doubt that you have much if any equity in the 2006. Bear in mind that most of the early payments are applied towards the interest.

If you can swing a trade at all, your new note will include the principal balance of the 2006, less any equity towards the down payment.

do the dealer deal with the payments
When pigs fly!

Answer 5

0the different between the amount owed and the trade-in cost the dealer gave you. the diff. is added to the cost of the used car you are buy..exp.owe 32000, dealer gives you 30000. the 8000 car now cost 10000...

Answer 6

depends on what your car is worth, lets say you owe 18k on your 06 and its only worth 14, you would have to pay the 8000 for your new car, and the difference, 4000 from your old car.

Answer 7

1

Answer 8

Sounds fishy... yet once you hand somebody a *signed* identify of possession, you're in result giving them your vehicle. chuffed which you probably did no longer sign, yet this remains no longer risk-free... different than for them no longer providing you with the money for the commerce, they are in a position to nevertheless artwork w/DMV to flow possession and so on... according to risk by a lien. Please be direct with them, you go with your money... the dealership owes you, and who's to declare what the tale is going to be in 25 days?

Answer 9

you could trade it and buy a better one.