NeedOutOfAutoLoan

[Anonymous]

I have a loan with Santander that I began in 2012. The rate is hovering around 25% ( purchased the vehicle around divorce and was not educated ). Fast forward to today, my original balance was 13,423 and my current balance on the loan is 13,479, which is more than where I started. My payment now is 368.00 and the vehicle has tons of miles on it. I'm considering a voluntary reposession but of course, I don't want to make my credit worse. I did a lot to rebuild.

[StartingOver10]

What is the vehicle make, model, year and miles?

Do you have a Carmax in your area to get an idea of how much they will pay for it? Their quotes are good for 7 days.

[Anonymous]

It's a 2010 Honda Civic with 106k miles.

[Anonymous]

I was in a similar situation with my autoloan, you need to pay down the principal as quickly as you can. If you can refinance that would help a lot too, but in my case I couldn't do that so I just started putting money into the principal. Which in effect cut my interest quite bit and put me in a better situation.

[Dj4Money]

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@Anonymous wrote:
I was in a similar situation with myautoloan, you need to pay down the principal as quickly as you can. If you can refinance that would help a lot too, but in my case I couldn't do that so I just started putting money into the principal. Which in effect cut my interest quite bit and put me in a better situation.

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 The only problem with your suggestion is that I am detecting the OP has some money/credit problems. I am going to assume they feel they can't get re-fi'ed as they have some late pays, high balances on credit cards, behind on school loans, etc.

 OP doesn't sound as if they can really put extra money in their payment as $386 is a stretch when you consider fuel, insurance, maintainence cost, taxes and license fees.

  I would suggest taking the car to Car Max and see if they will give you a price equal to your ten day payoff. If that doesn't work, then I would try to solve any credit problems that would prevent me from getting a re-fi. A CU wil re-fi a 4/5 year old car with high mileage. By dropping the interest rate a ton, the amount you owe will be more inline with the car's actual value.

 You might be too far underwater to carry the balance on a new car. You won't get your ten day amount in a private sale; in fact I will go out on a limb and say Car Max will give you somewhere in the middle of Kelly Blue Book/NADA value.

 If you try to get say a 2014 Nissan Versa sedan, Hyundai Accent Sedan, Kia Rio Sedan or LX Rio5, Fiesta Sedan or even Chevy Spark, you may be able to get a new car, a lower interest rate but the balanced rolled into the loan.

 Assuming its a 2010 LX Sedan, Automatic and the usual options in good condition should fetch about $10,000 in a private party sale. You can keep shopping dealers until you find one that will give you $10,000 for the Civic and then roll the balance into your new loan. All the new cars I mentioned are about $13,500 tax, license and rebates.

  You'll improve your chances if you can drive a stick, they would be on the lot the longest.

  If you roll the balance into your new loan it would be around $17,000. But cutting the interest rate in half or more (more than likely more, high single digits) means your payment will be more reasonable.

 Plus with new safety features and better mileage you'll likely save a little on insurance + gas.

[jbee]

Underwater, how much was your dti? I see you were approved by Cap One. I'm in a similar situation and need a new car. Thanks and congrats!