Author Topic: Selling or keeping car with a loan?  (Read 2745 times)

adasafa

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Selling or keeping car with a loan?
« on: September 18, 2013, 11:15:38 PM »
Wanted to get some opinions on this!

I owe close to 15K on a vehicle loan, even after making 1 year of payments on it.
I also owe about 9K in student loans with a 4.5 interest rate.

I am thinking of just selling the car back to a dealer/carmax and getting the loan paid off in full. I would then allocate the money to pay off the school loan, instead of paying the car loan. I also own a 93 Honda that is just sitting at my parent's driveway. The Honda is perfectly fine to drive. I would also save money because the "loan vehicle" requires I purchase full coverage insurance, whereas with the Honda I could get away with a cheaper liability-only coverage.

I regret purchasing the car. I only did so because I thought it would help build my credit, but now I am thinking it's smarter to pay off my loan and invest aggressively.


N

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Re: Selling or keeping car with a loan?
« Reply #1 on: September 18, 2013, 11:22:38 PM »
I vote sell the car with the loan, drive the honda. Absolutely.
Even if you owe money, you can still sell it private party, though I know the temptation to do it at carmax can be strong. either way, sell.

chasesfish

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Re: Selling or keeping car with a loan?
« Reply #2 on: September 19, 2013, 04:55:18 AM »
+1.  Sell the car and drive the Honda

Paul der Krake

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Re: Selling or keeping car with a loan?
« Reply #3 on: September 19, 2013, 06:14:58 AM »
Sell. If it makes you feel any better, used car prices are at an historic high right now.

Mr.Macinstache

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Re: Selling or keeping car with a loan?
« Reply #4 on: September 19, 2013, 08:23:57 AM »
Sell like your hair is on fire. Do a private sale on craigslist to make the most $, if its worth more than what you owe.

destron

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Re: Selling or keeping car with a loan?
« Reply #5 on: September 19, 2013, 09:12:22 AM »
Drop that car. Buying something expensive to build your credit is a poor way to go about it, I'm glad you have realized this. It's like people who spend extra money to "save on taxes". Drive the Honda at least until your student loans are paid off, then save up to buy a better used car eventually with cash!

adasafa

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Re: Selling or keeping car with a loan?
« Reply #6 on: September 19, 2013, 09:35:49 AM »
Thanks for all the input!

I only recently found this website and it really changed the way I think about money and life in general. I wish I would have known about the site before I bought the car though. Oh well. I will go in today and get a quote for my car and see how it goes.

N

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Re: Selling or keeping car with a loan?
« Reply #7 on: September 19, 2013, 04:34:02 PM »
last fall I sold our 2 yo car that I still owed 10k on. I got a quote from carmax, 10.5. The stealership offered me 10 minus a whole lot of fees, so about 9. I sold it for 11.5 or 11.25, something around there. private party. I sold it to an aquaintance who was looking for a car with my car's particular features, they mentioned it on fb. we worked out a deal, and it was great. I would have listed it on craigslist if it hadnt just worked out. I think the kbb was around 12 or 13 for mine in excellent condition, which it was not perfect, but pretty good.

just an anecdote.