Wanting to get out of upside loan...advice

[reereetx]

I currently have a 2007 Dodge Durango Limited Hemi 4WD.  It has just under 73K miles on it and is in excellent condition.  KBB and NADA both show trade in to be about $14K on the upper end and private party sale I could probably get around $16-17K.  Problem is....I owe about $20,900 on it.  I actually just refinanced from Wells Fargo at 16.18% to First Financial Investors at a little over 13%.  I just joined a credit union (after the refinance stupid move I know).  Now my issue is...I just found out I'm expecting my 3rd child. Completely unplanned and I was on BCP's.  I had somewhat been contemplating getting a Tahoe anyways because although I like my Durango...it just still didn't seem roomy enough and I didn't feel real safe in it.  I do a lot of highway driving as we live in the country about 8 miles outside of our small town.  My Durango is also black and I live on a white dirt road!  What was I thinking? 

I have found a used 2004 Tahoe(and it's white!) with 113K miles on it and they asking $9,500 for it. Not sure what I could get for a trade on it just yet but was wondering best way to go about this?  Should I just go talk to someone at my local bank or credit union and explain the situation and see if they will first off....even approve me to get the Tahoe (provided everything checks out on it good, crossing fingers since it has low miles for a 9 year old vehicle and carfax says it was one-owner)...and they pay off the negative equity on my Durango.

I know that I could try to sell outright and try to get the most $ for it....but then there's the escrow issue and I've done some research on it but it seems so complicated.

Any advice would be appreciated.  Just doing some "figures"....If I could get at least $15K for my Durango then I'd have to tack on about $6K in negative equity to the price of the Tahoe....guesstimating of getting 13% interest again (hoping better if I can get approved through CU)...financing for 4 years (which is 1 year less than what I'm already doing on the Durango)....I'd save about $100/month on payment and have it paid off a year quicker. 

Don't have actual scores but Credit Sesame and Credit Karma both have me right around 600-610 

[pizzadude]

It will probably be harder to obtain financing for a car that's ~10 yrs old / +100K mileage.  

Any chance that you could refi to a lower rate and pay down the principal on the Durango before you sell it ?    It shouldn't matter that you just refi'd, there aren't usually prepayment penalties.

[StartingOver10]

Remember this: you can NOT trade your way out of a bad loan without cash.

What I mean is - if you are in a bad loan, the worst thing you can do is trade your upside down vehicle in for another one where you will be more upside down. The thing that cures "upside down-ness" (if there is such a word) is CASH.

If you really need another vehicle. Sell the one you have for the private party value or more (if possible) and bring the cash to closing so you can deliver clear title.

Then after that transaction is done, go out and buy something else. You minimize your upside down-ness and get a much better deal on the purchase too. Don't do as many people do - they keep rolling the negative equity over and over into larger and larger amounts. It is the worst financial thing you can do to yourself.

[Ditovera]

+1

You are setting yourself up for more debt. Get the car in tip top condition and sell it privately.....get a payoff amount and settle with the financing company. With your current credit score and type of vehicle you are looking to replace the Durango, its not only hard to get approved but even iff appoved you will get APR rates that are certain to put you in more Debt.