advice needed re:car payment

Okay when i didn't own or rent I brought a car with a decent monthly payment(considerint at that time i had no mortgage/rent payment)........its been almost 2 yrs and i now own a home and find it hard to make the monthly car payment! what are my options if i now want to trade it in for something more affordable for me? people have tried to explain it but i don't fully understand the whoe trading down and paying old loan plus ne loan? any advice please share.......i havent gone to dealerships yet b/c i don't want to be talked into something i'm unsure about. ps the terms of my car loan is for 72 months .

Re: advice needed re:car payment

Basically from what I understand is whatever is left on your loan after the trade in value of your car will be rolled over into your new car loan so your payment may or may not be cheaper than what you have now.

Re: advice needed re:car payment

Get the buy out number from your current vehicle - the amount you owe now.

Shop for a less expensive car.

"Sell" your car to the dealer. The amount they are willing to pay will first be applied to the payout amount on your car loan and the balance will be used as a down payment on the new car.

You can use online calculators like kelly's blue book to get an idea of what you'll get from the dealer.

You could also sell the car privately, pay off the loan yourself and use the balance as a down payment for a new car.

Re: advice needed re:car payment

It depends on whether or not you are "upside down" in your car loan..meaning do you owe more money than the car is worth? If you don't, then your trade will cover what you owe and hopefully a little bit more. The dealerships are used to taking care of this and will be only too happy yo get you into a new car and sell your old one for a huge priofit. You shouldn't have a problem, but look up what you atill owe and blue book value of your car so you're in the know.

Re: advice needed re:car payment

If you owe $10k on it and they give you $7k for trade, the extra $3k will be added to the new loan for the cheaper car.

Can you talk with your bank to see if you can re-finance your current car to get lower monthly payments? If you have 48 months left on a 72 month loan, you may be able to stretch it to 60 or 72 months.

Or you can sell it yourself. Trade in values are always lower than private seller value. You are more likely to get what you owe on it this way.

Edited for an error. Can't count today.

Message edited 1/7/2008 11:08:35 AM.