I currently have an '06 Isuzu Ascender that is in good condition. Kelly Blue Book values it at $16,550. I know I won't get that exact amount but I am hoping to get close to that as I can. I would like to get an '07 or '08 Toyota Camry LE or Honda Accord LX or EX. I don't have a lot of cash to put down right now - maybe $500. I have poor credit, although we bought a house a little over 7 months ago. So far, there have been 6 payments due and we have made every payment on time. Also, we have two cars - my husband's is in his name only and mine is in both of our names with him as the primary borrower. We have never went over 30 days late with those either. I think my credit score is still poor because I have a lot of medical bills on there and some that are still reporting. I tried to trade the SUV in at an Acura dealership about 5 months ago, but they turned me down because they said I am too upside down. Currently the 10-day payoff is $21.803 and the 20-day payoff is $21,909.
2007-11-07 10:52:02 · 7 answers · asked by Hoping he will bless me with #1 4 in Business & Finance ➔ Credit
It doesn't seem like a very good move to trade in for several reasons.
1: You never get as much trade in as if you sell it private party. If you really want to get rid of this car, you are much better off selling your car as a seperate transaction. That will leave you upside down, and you would have to come up with addional money. However, that is much better than refinancing bad debt (the portion of what you owe that you are upsidedown on) into good.
2. Your car is in good condition. Why get a new one? If it is just because you feel like it, that is NOT a good reason. Your finances have to come before your taste. That is never a popular view point in the world of "I see it and I want it now!" Long term, suspending your taste for a couple of years until you pay down more of your car will result in you NOT being upside down and NOT losing a solid 5-6 grand in one transaction. If the dealership came to your door and demanded you hand them 5-6 grand, you never would do it! Going there now and getting a new car is exactly the same thing.
3. I used to work as an underwriter for a big bank. Your credit situation is likely pretty bad right now. If you go get a new note, the house you purchased is going to really push your score down, and you will likely end up with a VERY high rate. The only car dealer that will work with you are the "Everyone's appoved" variety AKA the "Bend you over with a 13% rate" dealerships.
My suggestion, lilke the others posted here, is to wait a year at least before getting a new car. Swallow your pride and just accept the car you have for the time being.
Check out the articles I've listed below for more detailed information.
2007-11-07 11:09:50 · answer #1 · answered by Anonymous · 11⤊ 0⤋
You probably will have very bad luck trying to trade in a 2006 vehicle worth $5000 less than you owe. Even if you do get them to take the trade, adding that $5000 to a new loan may make your new car payment and interest rate unaffordable.
If you already have two other car payments, and your credit is is poor condition, and you just bought the house, you will have an even more difficult time.
It seems the only option you should consider is keeping your car and not buy a new one.
2007-11-07 11:06:36 · answer #2 · answered by Jen 5 · 4⤊ 0⤋
The question that begs asking is why, given all the other debt you have, are you trading in an '06 car in good condition? The first two years are when a new car depreciates the fastest, so you've already "bought" that depreciation on the '06. Now you want to do it again!
2007-11-07 10:55:58 · answer #3 · answered by Anonymous · 5⤊ 0⤋
It is currently worth around $3000 but we still owe around $6000. What happens to what we owe on the current car when we trade it in. ---------------- That means you need to cough up $3000 cash down upfront to cover your negative equity in the Focus...or this deal won't be happening. Your question is a good one...that amount owed does not disappear--see my first statement as to what goes on.
2016-04-03 00:52:37 · answer #4 · answered by ? 4 · 0⤊ 0⤋
Thats a good question and I hope you'll find some reasonable answers
2016-08-26 05:55:57 · answer #5 · answered by Anonymous · 0⤊ 0⤋
Please visit daveramsey.com to learn ur hard lessons from others mistakes.
sorry u got into debt slavery.
2007-11-07 12:49:49 · answer #6 · answered by Anonymous · 1⤊ 3⤋
in a word NO!
2007-11-07 10:55:10 · answer #7 · answered by Anonymous · 1⤊ 3⤋