I bought a car in 2003 and owe about $8000 on it but am thinking of buying a new one. What will happen to my existing loan if I were to buy a new car? I would still owe that right? Would they just add that amount to a new loan amount? I'm confused about how this works. Please help!
2007-07-27 04:52:31 · 0 answers · asked by *Cara* 7 in Cars & Transportation ➔ Buying & Selling
I just did this in January..they will give you so much for you're car and take that amount off what you owe for the loan on you're old car. then the rest is payed off by them but they add it onto the car you're buying. i owed 7200 and they gave me 4500 so they added on 2700 to the car i was buying.
2007-07-27 04:57:35 · answer #1 · answered by Jackie M 2 · 0⤊ 0⤋
They will add the difference of the cars trade-in value and the amount owed to the new loan. This will make you upside down in a big way in your new loan. Here's the math:
Amount owed: $8000
trade-in value: $5000
================
Difference $3000
New car: $15,000
+ diff : $3,000
===============
New loan: $18,000
In no time at all, your $15000 car will be worth $12,000 due to depreciation, and you'll still owe $18000. This leaves you upside down by $6k, and will make it even harder to sell or trade the new car in the future.
Just because it can be done doesn't mean it makes sense to do it.
2007-07-27 05:06:45 · answer #2 · answered by Anonymous · 0⤊ 0⤋
They would give you a trade in value for your old car and subtract that from what you owe on the loan. They would then add the remaining balance of your existing loan to the new car loan.
2007-07-27 04:58:39 · answer #3 · answered by Robert T 3 · 0⤊ 0⤋
Ok, you owe 8K, and u trade it in on a new one. Lets say just for conversation they appraise yours at trade value of 6K, then you would owe what the new car deal is plus the 2K difference. They would pay off your old car and your new car would just be that much more money which may make you have to put up more money down, ie new car cost 20K, trade difference 6K, new car now 14K but u still owe 8K on trade in so new total for new car with your trade is now 22K.
Now for example they appraise your car at 9K, then you'd have a 1K credit towards your new purchase, but don't expect that to happen.
Despite what they say, dealers can often times finance a car at 110% of the selling price.
Either way you will have to come up with something down, more than you would if you weren't trading.
Good luck.
2007-07-27 05:06:06 · answer #4 · answered by junkyarddogfan 6 · 0⤊ 0⤋
You owe 8 grand on a 6 3 hundred and sixty 5 days outdated very own loan. this is a extensive quantity. the two to procure a ferrari or you obtain an extremely undesirable apr on the very own loan. which potential your credit is probable no longer so super. you would be even worse off in case you purchase yet another vehicle such as you opt to do. i could persist with this vehicle. your vehicle is probable in basic terms somewhat worth 0.5 of your last volume. that money would be tacked directly to the recent vehicle. that will strengthen your money even greater. what's the automobile? you are able to sell it outright yet could desire to have 8 grand to pay the monetary institution or you won't be able to sell it. you are able to desire to have adequate money to make up the adaptation from what you get for it.
2016-10-12 22:19:34 · answer #5 · answered by ? 4 · 0⤊ 0⤋
Where would the new car loan go toward? Will it go toward the bank i have currently with the old car or will it go to a different bank loan?
2016-03-24 14:46:07 · answer #6 · answered by Rafael 1 · 0⤊ 0⤋
When you sell your old car, you pay off the loan. If you owe more than it is worth (upside down) you may qualify to have the remains tacked on to the new loan.
2007-07-27 04:58:45 · answer #7 · answered by mybuttstinks2001 5 · 0⤊ 0⤋