Overhaulin'

I'm upside down on my car loan, what should I do?

I want to get rid of the car and get something with lower payments. Should I take it to a dealer, or should I try to sell it myself? Thank you!

Public Comments

1. try paying the downpayment and keep the car but if that seems very difficult then just give it a chuck and sell this one to buy a cheaper better car on pocket
2. Well, if you sell it yourself you will get more for it although it will not be enough to pay off the balance if you're upside down on the loan and you'll have to pay off the rest before the new buyer takes your car. If you trade it in, the dealer will give you less for you car but will take what you owe and add it to your new car payment making your new car more than what it is worth.
3. You will get more money if you sell it yourself, but you will have to deal with the hassle of paying off the loan so the buyer can get the title. There are services that can do this for you. You can also try Carmax. They generally give a little more than what a dealer would give on trade, but it's gonna be nowhere near retail. They can do all the paperwork for you, but you will end up writing them a check. The easiest thing to do is find a car that has a big rebate and have the dealer roll your negative equity into the new car loan. They will use that to pay off your trade. Do it this way: get quote from carmax go to new car dealer make best deal on car have them appraise your trade show them the carmax quote (if diff is only a few hundred $, you may be better off trading it at the new car dealer)
4. That's going to be a touch trick. You might be able to get lower payments by getting a 6 year loan and a much cheaper car. Only other thing is to try to save the differnce between the value of the car and what you can sell it for. Then payoff the whole car when you sell it and start from scratch with a car you can afford.
5. If you are upside down on your loan, selling it won't give you a better payment on the next one. The difference of what you owe minus what you get for the vehicle is rolled into the price of the new car. So the original payment might have been low on the new vehicle, but once you roll in the "upside down" part of the old loan into the new one, you probably arent saving any money, and most likely will hurt yourself by being even MORE upside down. You need to weight the feelings about a new car, versus a big debt. If you can suck it up, keep the car for awhile.
6. get every Penney and pay it down
7. If you are upside down by a significant amount, trading and getting a cheaper car doesn't get you lower monthly payments. In fact, your payments could be much higher than your current payments. Keep your current car, keep paying off your loan until you are no longer upside down. Then, you'll have a lot more options that make sense.