Auto loan advice- Upside down and having a hard time.

[Anonymous]

Hi, was reading your replies and help for people being upside down and I find myself in that position as well.   I have a 2009 LaCrosse that I made the biggest mistake and bought from Drivetime.  I owe almost $14K and am told it's worth about $4K.   I've got to get out of this car and loan.  With it being start of a new year, will dealers deal?  I make $42K/year.  My rent is low, $600/month, but current credit karma score is 585.    I can afford up to $500/month for a car and would be happy to just to get away from this loan.     Any advice?     I really do not have a downpayment.  If at all, it would be about $500

[Dj4Money]

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@Anonymous wrote:

Hi, was reading your replies and help for people being upside down and I find myself in that position as well.   I have a 2009 LaCrosse that I made the biggest mistake and bought from Drivetime.  I owe almost $14K and am told it's worth about $4K.   I've got to get out of this car and loan.  With it being start of a new year, will dealers deal?  I make $42K/year.  My rent is low, $600/month, but current credit karma score is 585.    I can afford up to $500/month for a car and would be happy to just to get away from this loan.     Any advice?     I really do not have a downpayment.  If at all, it would be about $500

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 Here we go -

 How many payments have you made and have you ever been late IE late that it shows up on your CR?

 If you've made 6-7 payments, all on-time then go to a credit union and see if they will re-fi; chances are they will.

 CK is FAKO, pay for your scores here. My actual FICO scores are higher than CK....

 What else is on your CR? Do you have anything on there you can clean up in 30 days to get your score over 600?

 What is your current payoff if it's only worth $4,000?

  The car will have to be cheap about $20,000 or less for a bank to swallow $10,000.

 That leaves only one choice -

 Sub-$20,000 new car loaded (Accent, FIt, Fiesta, Sentra, Elantra, Focus Sedan) with some money on the hood (rebates, incentives, etc)

 You'll likely need to keep the total loan under $25,000 and you may have to come up with $1,500-$2,000 to pay for taxes.

 They might be willing to sell you the new car for a deep discount to get you into it.

 Like I said try to re-fi your current car, try to get a new car loan from a credit union or Capital One.

[Anonymous]

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@Anonymous wrote:

Hi, was reading your replies and help for people being upside down and I find myself in that position as well.   I have a 2009 LaCrosse that I made the biggest mistake and bought from Drivetime.  I owe almost $14K and am told it's worth about $4K.   I've got to get out of this car and loan.  With it being start of a new year, will dealers deal?  I make $42K/year.  My rent is low, $600/month, but current credit karma score is 585.    I can afford up to $500/month for a car and would be happy to just to get away from this loan.     Any advice?     I really do not have a downpayment.  If at all, it would be about $500

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You know your new car will be upside down again right? Now this time even more if your able to find a dealership willing to rolling your current negative into new loan. It's still there and won't just disappear. If your asking will anyone pay 14k for your car when it's worth 4K most likely no dealership going to do that. No matter what the negative equity will be there

[StartingOver10]

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@Anonymous wrote:

Hi, was reading your replies and help for people being upside down and I find myself in that position as well.   I have a 2009 LaCrosse that I made the biggest mistake and bought from Drivetime.  I owe almost $14K and am told it's worth about $4K.   I've got to get out of this car and loan.  With it being start of a new year, will dealers deal?  I make $42K/year.  My rent is low, $600/month, but current credit karma score is 585.    I can afford up to $500/month for a car and would be happy to just to get away from this loan.     Any advice?     I really do not have a downpayment.  If at all, it would be about $500

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When you find yourself in a hole, the very first thing you have to do is to stop digging.

What that means in this context is - you can't trade your way out of negative equity. You have to end up paying it at some point in order to get rid of it. If you do trade your vehicle now, you will be trading into a worse loan (higher payment and higher negative equity).

Take the time to improve your score. Credit Karma scores are not used much at all (if any).  Find out what your FICO score is here and pull your credit reports from annualcreditreport.com  Review your reports and repair and rebuild before you attempt to purchase another vehicle.  Visit the rebuilding forum for ideas on how to specifically handle any derogatory tradelines on your credit report.

In the meantime, pay down your current loan as rapidly as possible. Get a second job or sell things around the house so you can build up savings. Going in unprepared with no down payment, low scores and upside down on your vehicle is the recipe for disaster on any new purchase you may want to make for your next vehicle. It is  a signal to the finance people that you are desperate.

You don't want to do that because the vehicle finance department will take full advantage of your situation and offer you even less for your trade and charge you more for the next vehicle with an even higher interest rate. They are trained to spot desperate consumers and to take full advantage of the fact that you want out of your current loan.

Make this next deal a good one by prepping your credit and income and savings first. Then learn the best way to buy a vehicle and next learn why you want to finance with a credit union rather than letting the dealership finance you.  After you have done that, then you are ready to get out of your current loan and get into a better loan.