Overhaulin'

Upside down on loan looking to trade for a different car- How do I do this? Any Suggestions?

I need to trade my 2002 chevy tracker in for a car. I owe $12,000 yet on the tracker. Blue book says $7500 trade in value. I currently have every extra warranty and gap on the tracker. What can I do? How do I do it? I'm looking for a Toyota car. Should I go newer like 2005 or older like 1998? Which would be the best way to go? Should I hope and pray for it to get totaled? Can I sell it instead of trade it in? So far where I live I've found: 2005 Corolla $10,500 and 47,920 miles, 1998 Camry $5,944 12,2657 miles, or 1996 Camry $3,977 177,207

Public Comments

1. you will be trading down so you will take a beating. grease up and don't expect a kiss
2. Actually, trading down like that with that much negative equity is darned near impossible unless you happen to have the cash sitting sround. The best bet you have is to go with something brand new and with HUGE rebates... like a leftover new '06 or something along those lines. Also remember that because of this little gadget called a computer, people will only pay blue book when the buy a used car, so the actual wholesale trade value of your tracker is probably more like $5500 to $6000. Sorry to be the bearer of such bad news, but that's the auto business.
3. The good news is that both the exted warranty and gap coverage are items that can be cancelable at the dealership your purchased your Tracker from. The dealer will prorate the unused portion of the gap and ESC and refund the difference to your lienholder. Hopefully after doing so, your payoff will only be $11K. Next, assuming the dealer gives you $7500.00 for the Tracker - that makes you $3500.00 upside down. Say your looking at a 2005 Corolla S with 40000 miles on it for $9995.00 or a 1998 Corolla CE with 95000 miles on it for $5995.00. Keep in mind you have to add the $3500.00 on top of the price your paying for the Toyota. Would you rather owe $13495.00 for a 2005 with 40000 miles or $9495.00 for a 1998 with 95000 miles?
4. Your pro-rated refund on the extended warranty will only equate to a couple hundred dollars at best, not $1,000. If you go for a 1998 model, a prime lender won't finance the car because it is older than 2001, so if those are your options, go with the 2005 model. Most dealerships go by Black Book, not Blue Book, so don't be surprised if they only give you $7,000 or less. Kelly Blue Book is only guide and doesn't actually purchase vehicles at the prices they claim. I don't know what the value of your car is in regards to Black Book, but sometimes it is close to Blue Book. You can sell your car yourself, however if you sell it for lets say $10,000, you will have to come up with $2,000 before the lender will release the title. $3,500 upside down is not all that bad compared to many vehicle purchases. Definitely examine the paperwork before you sign it, so you aren't stuck into a 7 year loan or something like that. Good luck!