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Owe more than it's worth... I'm upside down and I can't get up!

1186 messages,  Last post on Jul 16, 2012 at 2:49 PM

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What is this discussion about? Car Leasing

Messages Page 1 of 119

#1 of 1186 Help me please...I'm upsidedown and I can't get up! by fillesmom

Dec 19, 2003 (5:31 pm)

I am very new to car buying and I need help! A few years ago I just had to have a Volvo 850T wagon. I LOVE this car but the payments ($456) are killing me! (Not to mention the cost of any repairs - $163 for a headlamp!) I am finally ready to give up my beloved dream car. Unfortunately I find that my payoff is $9244 and the trade in is only $5700. What in the world should I do? Can I roll this over? I was thinking of leasing something with a much lower payment. (That way I could avoid repair costs.)

#2 of 1186 Ouch. by lancerfixer

Dec 20, 2003 (9:50 am)

I'm assuming you bought this used. How long was the term for...are you more than halfway done with the payments? If you go over to the "Real World Trade-In Values" thread on the Smart Shopper forum and post a very detailed description of your car, Terry over there could probably give you an idea of a good asking price if you want to sell it yourself. I advise against rolling over negative equity into a new car; eventually, you're going to be paying this money you owe one way or the other.
You're not alone in this; I've been in a position of negative equity in the past, and made the mistake of rolling it over into another car. It's awful, but it's survivable (I sucked it up and made all the payments, and lived to tell the tale; the car is paid off and I've still got it.) Good luck.

#3 of 1186 more than half paid for by fillesmom

Dec 20, 2003 (12:50 pm)

Yes , the car is more than half paid for. I foolishly financed it for 60 months. Just HAD TO HAVE IT! Believe me I learned my lesson and won't make that mistake again. Now I am just trying do damage control.I have gotten a good idea about what it would sell for. I am thinking that I should get rid of it now because of the huge repair costs that are popping up pretty often. I is it bad to roll it over and just pay the amount on the new loan? Or maybe I should try to get the value and amount owed even with a lump payment and then sell or trade?

#4 of 1186 Tough spot... by isellhondas

Dec 22, 2003 (9:12 am)

Personally, I think you should probably just keep it. Volvos have a nasty way of getting expensive as they age and it sounds like you are finding this out.
 
Still, trying to roll 5000.00 of negative equity is going to be VERY hard to do. You will then be double buried.
 
I would just try to tough it out.

#5 of 1186 Yep, it's a Catch 22 - by driftracer

Dec 22, 2003 (9:49 am)

rolling $5K into another car takes a huge rebate - like those on Chevy products - therein lies the dig. You're going to be an owner for whatever would be next for a LONG time - if I were buying a car to keep 5-6 years, it'd be a Honda Accord. Problem is, there's no rebates to help you.
 
On the cars with rebates, I wouldn't bet a dollar on being able to keep one for 5-6 years without significant major component replacements/repairs.

#6 of 1186 by bolivar

Dec 26, 2003 (1:03 am)

No, you are not 'trying to do damage control'.
 
You are wanting someone here to reinforce what you want - to buy another car, which will inflict more damage, by burying you further in this next car.
 
Keep the car. With $5,000 negative equity plus the cost of another car, I don't see how you could reduce your payment amount.

#7 of 1186 by q45man

Dec 26, 2003 (4:58 am)

You are alot more than $5,000 in the hole because the next 20 months will require at least 10 cents per mile driven in maintenance and repairs. Plus your payments and all the other associated costs [gas/insurance/tag/tax]
The State of Texas uses 8 cents per mile for their fleet and Volvo might run 12-15 cents.

#8 of 1186 by fillesmom

Dec 27, 2003 (8:45 am)

I'm not trying to get anyone to "reinforce what I want"! I LOVE the Volvo and don't want to give it up. I am just seeing if there is a way to help the families monthly budget! What a nasty response from bolivar!

#9 of 1186 fillesmom- please understand by driftracer

Dec 27, 2003 (8:48 am)

that his response describes 90% of people trading a car with a loan - being in the car business, I see it every day.

#10 of 1186 by anonymousposts

Dec 27, 2003 (11:46 am)

Leasing isn't as great of an alternative as it used to be. Rebates and 0.0% financing have driven residual values down to the point where leasing is often just as expensive as purchasing the car. This is the case unless you are looking to lease a Honda, VW, etc which have retained high residual values.
 
Do what you feel will be best for your personal financial situation but remember that whatever vehicle you choose you will be stuck with for years to come. Therefore, make sure it is something that you can live with and will have reasonable repair/maintenance costs.

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