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Smart Shopper Owe more than it's worth... I'm upside down and I can't get up!
1160 messages, Last post on Oct 22, 2009 at 7:11 PM
You are in the Smart Shopper Forum. Your Hosts are kirstie_h & tidester
| 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? | |
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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. |
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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. |
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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. |
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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. |
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| 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! | |
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| that his response describes 90% of people trading a car with a loan - being in the car business, I see it every day. | |
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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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20 payments of 456 equals 9120 (less than a payoff of 9244 which would not include 20 months interest.) 9244-5700 = 3544 upside down (a lot less than 5000). might be fuzzy math, but it looks like you would have to pay $350 a month for a $250 a month vehicle for 36 months. |
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First, keep in mind that the negative equity situation you are in is based upon a dealer's opinion. If you have only shopped one dealer, you may be surprised to find how wide of a range of estimates you will get for your car. If it is in great condition and is a popular color (red and white are near the top of the list) some dealers will pay more for it than others. Your $5K negative equity may suddenly become $3K or less at the right dealer. Second, the BEST way to get rid of a car (legally) is to sell it yourself. If you don't want to have strangers coming to your house, consider running it on ebay. I'm amazed at the range of cars that are selling on there for much more than they seem to bring in my local market. Also keep in mind that if you are exposing your vehicle to millions of people on ebay, rather than hundreds or thousands in your local paper or Auto Trader. If you go the online route, do your homework first. Investigate what cars like yours are bringing on ebay. Make sure your car is in great condition and spotlessly clean; I'm continually amazed at how a good looking car will bring more money than a similar car with a new engine or transmission that only looks fair. Take some excellent photos of your car in an attractive setting, such as an upscale resteraunt, large or historic building or an easily recognized landmark. Make sure the photos show your car inside and out, including the engine area. Do NOT use a Polaroid or any camera that takes poor photos. Shoot the car on a clear, sunny day and do NOT put the car in the shade when you take the photos. MOST importantly of all: shoot the car CLOSE. Fill up the viewfinder with the car; if the car looks like a speck in the photo, positive things like its' condition won't show up well. Write your narrative carefully, completely and accurately. For example, if you are in New Jersey and your car has heated seats but you overlook mentioning that in the narrative, it could cost you a sale. If it has all-wheel drive or traction control, that could also be a huge plus to a potential buyer in snow country. If you don't know what some options or features are called, use your owner's manual, a sales brochure or look at the wording used in other ads. Finally, be REASONABLE about your price. If a retail book says your car retails for $10,000, I've seen buyers think their car is worth that and not a penny less. But, if your car is high-mileage, not equipped properly or in sub-par condition, or in an area where that model isn't popular, then getting that price is more of a fairy tale than it is likely to be reality. As I mentioned earlier, investigate to see what cars like yours are actually selling for. All of the dealers in this forum will tell you that the retail books, no matter which one you use, are at best guidelines, and sometimes more like wishful thinking. Good luck! Joe |
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