Overhaulin'

Want different car, upside-down on loan...?

I HATE my current car (a Chevy) and want a Honda. I made a huge mistake when trading a while back. I owe $15k on a car that is probably worth half that. I have credit problems approximately 3 years old, but have paid off all bad debts. I have 1 credit card with a balance that I pay at least the minimum on time. I have student loans in default until I am done with school. I have rent and one job (that I have been at for 5 years). I've never paid my car payment late. I don't even want a new car, I just want a Honda with decent mileage. Do I even stand a chance? Are they going to laugh at me when I go to the dealerships? :( I HATE MY CHEVY POS!!!

Public Comments

1. be careful as dealer wants to sell you a car that has profit for him too
2. Don't go to a dealership. I used to work at one as a salesmen. I got out because i got tired of putting people in the situation your currently in. What you need to do is try to sell privately. It may take some time but its the only way you will be left with less owing on your current loan. This is where it gets interesting. Before you actually find a buyer, Apply for a loan at your bank. The only way you will get a loan is if you offer them money up front. For this reason you will need to apply for at least $30 000. That way when you sell your chevy. You can use that money to put down at your bank for the loan. Then when you get the loan from the bank, pay off the chevy loan immediately and go shopping for your new car. I suggest an auction. Good cars low mark up. When you've achieved all of this. You've just done everything a dealership would do but you haven't been ripped off with all their hands in your pocket. It sounds hard but its your only option if you want to save money or even get approved for any loans for that matter. Read this over many times. it works.
3. This is always a tough situation. With so much negative equity, no lender is going to want to roll it into another loan in which you would be even more upside down. You could consider selling the car but you would have to come up with the negative equity in cash to fully pay off the loan. Here's an article with more details: http://www.firstcarguide.com/finance/can-i-buy-a-car-if-i-am-upside-down-on-another-loan.html .
4. Save up some money, and pay cash for your next car.
5. Sorry to have to say this: You have a bad problem, it comes with a bad solution. The following advise will keep you from making your problem worse, and help you learn a lesson you will never forget. Keep you car, pay it off. Next time you buy a car follow these guidelines: 20% down payment, finance the balance over no more than 48mos. If you cant do that; you cant afford the car. good luck
6. You have several things working against you that will keep you from getting this done. 1) You own a car that's worth (I'm assuming due to your statement) half of what it's worth. If you're going by Bluebook or another online source, you're probably not accurate, as most dealers' wholesale value is not based off of Bluebook. Right now, dealers are giving as little as possible on trades. 2) With that negative equity, you have to add it to the purchase price of the new vehicle, AND ask the bank to overallow a huge percentage. So, that $7500 (assumed) overage is now added to (for example) a $10,000 car. Now, you have to see if the bank will give you $17,500 in loan on a vehicle worth maybe half that. 3) With bad credit, the above scenario in #2 won't happen. Even with an excellent FICO score, banks will only overallow "maybe" 110-115%. If you come in with a bad score and past issues, they won't even consider it. You got into a bad situation where you do not like your current car. Learn from it. Next time, make sure. There is no "magic" way to erase negative equity (a common question on here). Even if you found a bank to overallow that much onto a new loan, you're worse off than where you started... owing double what a vehicle's worth. You're even more upside-down than when you started. Advice? Drive that Chevy, pay it off, and then re-think your situation.
7. You don't want to hear this, but you need to learn to love that Chevy. The best option for you is just to keep it. You owe too much on this vehicle to be able to get rid of it.