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Is a car trade in a good idea?

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gatorgal
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Is a car trade in a good idea?  Reply with quote  

Hi,
As a single adult I was always frugal and saved my money. I always had a comfortable amount of money for my needs in my savings account. I have now been married for 6 years and find it very difficult to manage our money. My husband is the money earner and he is in sales. Our income varies from month to month. We bought our first home a year and a half ago. One year ago we purchased TWO 2014 vehicles. Our car payments are almost $800 a month. We simply can not afford to spend that kind of money and it is stressing me out. I am very ignorant about loans and selling cars and so forth. Can I trade in one or both of our cars and get something older and more affordable? How does that work? What happens to our loans? Is it even possible to get the cars paid off so that our new car(s) have lower payments than we currently have? I am clueless. TIA.
Post Thu Feb 04, 2016 9:40 pm
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littleroc02us
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When I was younger and stupid I leased a Dodge Ram 1500 and it was the worst idea ever. I could afford the $415 payments until I got laid off in 2001 because of the Tech bust. I almost got the stupid thing repossessed, but luckily I got some help with a loan to buy the vehicle outright and then work for years to pay it off. As Dave Ramsey says, stupid tax is what that's called.

So now I'm a little older and more mature. My wife and I don't buy new cars, we pay cash for used cars that have 100k on them and we drive them into the ground. They are quality brands and models that have a good track record. Because we don't have payments, we can afford to invest and save for retirment.
What I'd advise for you to do is to go on KBB and find out the private sale value of both vehicles. Compare that to what you owe on both models and then take a loan out from a bank to pay off the remainder is any and also a small auto loan of no more then 5k each and go out and buy a quality used vehicle that runs well. It doesn't have to be anything special. For example, I sold a 2007 Mitsubishi Galant with 107k miles on it and it will run for another 100,000. Wouldn't you rather have small monthly payments on a reliable vehicle then $800 payments on new?
The lesson learned here is to gain wealth, you don't buy depreciating assets.

Risk comes from not knowing what you're doing. (Warren Buffet)
Post Thu Feb 04, 2016 9:56 pm
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oldguy
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quote:
we purchased TWO 2014 vehicles.


Also, it depends on what you bought. If you bought modest Japanese functional cars, you are probably set for over 200,000 miles. OTOH, if your bought Euro performance cars, they will get expensive by 100,000 miles. So if you bought the right cars, you might want to suffer the payments for 4 ? more years and keep them another 10 or 12 years after that.
(We have a 2006 Toyota Van that we bought new in late 2005, it now has 190,000 miles on it, runs well, no issues.)
Post Fri Feb 05, 2016 12:03 am
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gatorgal
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We have a 2014 Honda Civic SI and a 2014 Chrysler Town and Country Touring. The Civic is a manual 5 speed which my husband adores and I know Hondas are great. There are mixed reviews about the mini van. Would it be wise to refinance?[/quote]
Post Fri Feb 05, 2016 2:23 am
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oldguy
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quote:
Honda Civic SI and a 2014 Chrysler Town and Country Touring


One great, one not so good. You are probably upside down in the loans (you owe more than the car is worth). Eg, you might still owe $30k on the minivan but today the van is worth only $22,000. So the most that a lender could lend on a $22K car is $22k. Ie, he would lend you $22k and you would need to pay the old lender $30k, you would have to come up with the $8000 cash.

Give us the actual numbers and we can calculate it for you.
Post Fri Feb 05, 2016 7:03 pm
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rahul_25
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Dear gatorgal ,
First of all whatever mistake occurred with you.....accept it so that you can get some peace.......and your mind became able to fight with this situation after all that was also ......your best decision according to your that time of consciousness level ........ so by my experience if you really want to overcome this challenge of current emi ........ so go with any reputed Cash Advance services which has higher rates of approval, due to the fact that is not heavily based on a credit rating. In order to be more specific ....just mail me your problem in detail with your financial status.

healpinghands4all@gmail.com

It would be my pleasure to healp you out from this trouble.
Post Mon Feb 15, 2016 12:55 pm
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