New car deal?

Question

I have a Ford Focus with 33 K on it. I got a letter from the dealer I bought it from asking me to come in and see if I can trade it in. The salesperson told me that the value of my old car has reduced to 8k and I bought it for 14,999 (I owe around 13K on it). He is saying I can buy a new Ford Focus with 0 miles on it and no negative equity on it along with 5 year warranty and at 12k. Do you think it is a good deal? The only thing that would be a minor issue is that I would be making a little more (20 bucks more) then what I am paying now as payments on the old car.

Answer 1

What you're saying doesn't make sense.

What are the terms that he's offering you? Is he extending out your loan terms? (ie you only have 3 years left and he wants to extend your loan terms out another 5 or 6 years?)

Your description seems to indicate that you're upsidedown on your current loan. The dealer would have to show me how he's doing the magic to eliminate any negative equity you have in the current vehicle.

I'd be weary unless you know exactly what your getting into.

Answer 2

unless they are actually giving you what you owe on your car, it is impossible to avoid negative equity. It's simple math $13,000 -$8000 does NOT equal $0.
I'm guessing they are extending the term. They are simply giving you an option. It is up to you as the consumer to be heads up enough to realize there isnt a negative equity fairy that comes along and pays off your old car.
Good Luck

Answer 3

how are you going to avoid negative equity if you owe more than the car is worth. something does not sound right. I used to get notices from the Honda dealer that they were looking to get my 05 civic as a trade-in on a new one. Let's just say it was not worth it in the end,.

Answer 4

WHAT HE IS TELLING YOU IS FLAT OUT UNTRUE BECAUSE WHAT IS GOING TO HAPPEN WITH THE BALANCE THAT YOU OWE.

THIS GUY IS GOING TO TAKE ADVANTAGE OF YOU AND THE NEGATIVE WILL BE ADDED SOMEWHERE.

BE CAREFUL.