trade in car 7 grand upside down

[Anonymous]

I have a 2012 ford fusion that I owe 19k
on but it's only worth around 13k.
I'm looking at trading it in for a 2014 chevy silverado. Sticker price on that is 40k but they have 11k on rebates so we'd end up paying about 29k plus tax, title, and license. Kelley Blue Book says this truck is worth about 30k for private party value.
Would this work in getting rid of that negative equity?

Since it is Saturday we didn't talk numbers or anything yet but i'm guessing/estimating all together with interest after they finace it we'd be paying about 39,000 if our notes are about 550 with an interest rate of 9%, which is way more than blue book so does that mean we'd be upside on this vehicle too?

Any help or explanation would be appreciated.
Thanks!

[pizzadude]

---

@Anonymous wrote:

I have a 2012 ford fusion that I owe 19k
on but it's only worth around 13k.
I'm looking at trading it in for a 2014 chevy silverado. Sticker price on that is 40k but they have 11k on rebates so we'd end up paying about 29k plus tax, title, and license. Kelley Blue Book says this truck is worth about 30k for private party value.
Would this work in getting rid of that negative equity?

Since it is Saturday we didn't talk numbers or anything yet but i'm guessing/estimating all together with interest after they finace it we'd be paying about 39,000 if our notes are about 550 with an interest rate of 9%, which is way more than blue book so does that mean we'd be upside on this vehicle too?

Any help or explanation would be appreciated.
Thanks!

---

Yes, you'd be underwater as soon as you buy the truck since it will have a book value at most 30K as soon as you buy it, but you'd owe more than 5K on it.

[Pharoe33]

Wish I had read your post first before I made my post. I'm in the same boat. I was told being I'm upside down to only shop for a brand new car/truck to get those rebates. 

[CreditExpressNJ]

From my experience the best way to come out of an upside down is to lease although your lease payments will be hefty... overall its the fastest way to do it.....without actually paying the actual upside down amount...

[0REDSOX7]

I have heard (and been told) that the best way to get rid of negative equity is to do a lease as well. Again, payments will be higher but is still easier to do.

[StartingOver10]

(Disclaimer: I am anti-auto lease except in very narrow circumstances.)

I can see where a auto salesman or F&I rep would recommend a lease as the profits on leases are huge for the auto dealer. I am not sure that I agree that trading into a lease is your best option for getting rid of negative equity. It is a viable alternative, but IMO at the end of the lease you  are left with nothing. That might be okay for some situations (viable solution). But I would hate to pay on something for 3 years and have nothing at the end of 3 years.  JMO

I found an article by Edmunds discussing the various alternatives to getting rid of negative equity. It comes down to what you can tolerate because you are the one that has to bear the burden. Here is the link to the Edmunds article: http://www.edmunds.com/car-buying/being-upside-down.html

Here is another article that follows along the lines that I think are better for you, the consumer, if you happen to be upside down in your vehicle loan. This is more of a long term solution. Slightly painful initially, but well worth it.

http://www.moneycrashers.com/how-to-get-out-of-a-car-loan-when-you-owe-more-than-the-car-is-worth/

One more good article by the the FTC on this topic:  http://www.consumer.ftc.gov/articles/0257-auto-trade-ins-and-negative-equity