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Can't afford car payment

yeishinu's Avatar

Join Date: Sep 2006
Posts: 1

09-14-06, 05:36 PM   #1  
Can't afford car payment

Much as the title implies, I have recently gone through some life changes, and as such being a 20 year old paying almost $600 a month for a car with insurance, isn't really panning out in my favor any more.

The problem with all this is I am carrying about $5000 negative equity on the vehicle (ah, the wonderments of the swindling car salesman) and so that is the primary roadblock.

I am wondering what exactly my options are, as I have racked my brain and come up with none. The problem lies that I have been out of school for almost three years, and right now I have to work 40 hours a week to barely squeek by and afford this vehicle as well as gas and other associated bills, and I want to get back into college, but I cannot afford any time cuts.

I appreciate any advice, and apologize if this is in the wrong place or entirely wrong spot on the web.

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rdn2113's Avatar

Join Date: Oct 2002
Posts: 451

09-14-06, 10:47 PM   #2  
Go to www.kbb.com and use the information there to help you determine a reasonable fair market value for your car. Once you have a good idea of its value, sell it and pay off the car loan.

If you owe more than what the car is worth, see if you can sell the car below book value and get someone to take over the payments.

Once the car is sold, use the money you save in insurance, payments, etc. to get a car you can comfortably afford. Or, even better, forget the car for a while and take the bus. Bank the money you save putting some away for a car at a time you can afford it. Any additional funds can be put toward college.

This really comes down to will power and priorities.

Best wishes.

the_tow_guy's Avatar
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Join Date: Feb 2001
Posts: 11,475

09-15-06, 04:58 AM   #3  
I agree with rdn2113. In addition, take a second job [or a third] until you dig yourself out of the hole; lots of people do. Forty hours a week is NOT a lot of hours at your age. There are plenty of people twice your age working a lot more than 40 hours a week. Stop blaming the "swindling car salesman"; I doubt he held a gun to your head while you signed the papers. You wanted the vehicle, you signed the papers, you owe the money. Sorry if this is a little blunt.

Measure it with a micrometer; cut it with an ax.

fsufan8's Avatar

Join Date: Sep 2006
Posts: 103

09-15-06, 02:51 PM   #4  
I don't like trading cars in but what you could do is trade your car in a much cheaper one, then have the money you are under water for be financed in with the cheaper one. That way, you'll be relieved of the heavy payment and now have a much more manageable payment and not have to chump up $5K right off the bat. Have that $5K worked into your cheaper car payment. I did this one time when I was much younger ...although, I had to sell my expensive car not b/c the payment was too much but b/c the payment was a lot and the damn thing was in the shop twice a month for expensive repairs. Paid $14K for it (5 year old RX7 convertible), had it for 4 months, traded it in for $11K, and worked the $2.5K negative balance (seeing that I had made 4 pymts. on it) into my next car that I only paid $10K for. The payment was maybe $40-$50/month higher than it would have been w/o the extra $2.5K added in. Good luck!


goldstar's Avatar
Forum Topic Moderator

Join Date: Oct 2002
Posts: 4,286

09-18-06, 01:46 PM   #5  
Even if you basically "gave" the car to someone who would take over payments, your $600 a month puts $7200 a year in your pocket. Use public transportation ( and friends or family) for a few months. Then look for a "beater" you can pay cash for and get the minimum insurance coverage. There are a few good, older cars out there. Just takes patience to find them.

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