Hi there, I needed some advice on my car loan.... My fiancee and I owe ~6700 on credit cards, and we have made it point to pay them off in 8-12 months. One thing holding us back is our car payment and insurance. We both bought new 2002 Honda Civic Coupes back in October... had $5,000 worth of inequity on our old cars so we each ended up paying $13k + 5k for each car.... so initially we were looking at 18k Civics. Well, we now both owe about $16k and the cost of having a new car (with higher insurance, etc) is something we want to get out of. Would I be able to work a deal with a bank to get a cheaper used car, something for $5k or so, slap on the difference of the inequity (I would guess our cars would trade in at 12k) so buy a $5k car for $9k? That would pretty much cut my car payment in have and have lower insurance on an older car as well.
I doubt you could make a deal with the bank like that, but there's nothing to stop you from selling the car you have, paying off the loan, and buying another cheaper car. HTH, Brett
Hi. We had that problem as well. We are about $4500 upside down on my car and when we tried to trade for a different vehicle, everyone said no. We had a friend working at the car dealership try to help us out and we could not find ANY companies that would finance us at that high of a percentage over true market value of any car that we could have purchased. The only thing that we found we could do is to cough up the difference between what we owe and what the car is worth and sell it outright ourselves. I think peoplefirst will let you finance 110% of a cars value (this may just be new cars, I can't remember), but it looks like you are in the same situation that we are in that even with the extra 10% it was still not enough to cover the inequity of the current vehicle. Hopefully, you will have some better luck than we did!!
You may NOT have "lower" insurance on an older car, in fact it may be HIGHER,much of the cost of your insurance is in the liability portion,which is higher in an older car because of factors like air bags, antilock brakes etc. In addition, on the comp. and collision part, the repair costs on older cars are frequently higher than the newer ones. If you raise your deductibles on your existing insurance, and have both the cars on ONE policy,which would probably involve some paperwork,you might achieve some additional savings. Although your desire to pay off your credit cards is laudable, you should probably stretch that out for a longer period, and keep your cars, which as they are under warranty,will also save you on repair bills.
BC of you're age collector, you're ins. is high. Once you get married you're ins will probably drop to about half of what it is now.
