I bit off more than I can chew. Anyone want a bite?
November 30, 2009 1:12 PM   Subscribe

Help me get rid of my car.

Back story:
A year ago I traded in my sedan on a monster SUV. Sounds silly, I know, but at the time it made sense. New job, nice paycheck, we live in a snowy place, we play outside, dogs, etc. It's exceptionally nice, but between payment and insurance we're out $510 a month. ($360/150 respectively.)

Fast Forward to Today:
The job was horrible, I hated it, was awful, I quit. We moved back home. She now has a job and I do too, but our combined incomes are only about $50,000 gross. Yea, gross. I am starting to do some side work, but realistically it's only going to add $200-$500 a month for the forseeable future, if that.

We have decent credit, me about 680-700 and hers a steady 777. Today we will close on our first home together. We'll have about a 20 mile commute to work daily. We can afford all our bills, that's not the issue. The issue is that we're trimming all the fat from our budget because we want to do more and we want to save more.

We owe about $14,500 on the truck, the last trade-in offer we got was $12,000. We potentially have some cash for down payment on something else, but probably not $2,500, at least not yet. Blue book is right at $15,000, but it's not surprising we can't get it.

So even if we keep the same approximate payment but greatly increase our gas mileage (now...about 12-15 in town and 18-21 highway), we'd have more money. Or if we could vastly drop our payment, we'd have more money. We've shopped insurance until our brains fell out...and it IS going down because of the house, but it's still too much. No accidents or moving violations, this state's insurance is just nuts.

So...what do we do? Do we trade it in on something 8-12k and go that route? Do we try to do something new and go for ultra-low interest? Do we stop paying it and let them take it away, and then buy a beater with cash? (Mostly joking there, I know that's not a good idea.) Do we try to sell it privately and start even? (I'm not ok with strangers driving my truck.) We can potentially refinance the truck, but idk how much that would help us. It's an 05, currently paying 8% (which is stupid high for a car but about average-to-good for used 'round these parts.)

And then what kind of car should we be looking at? Front wheel is mandatory (snow) or awd/4x4. Mileage is important, and obviously that $12,000 looms big as well. We live in a mountain-y place too, so something like a swift or a metro just won't cut it either.

Anonymous gmail account at smashingsuccess@gmail.com if you don't want to respond here, although I don't know why you would. I should point out that we do have a beater right now as well, but my lady steadfastly refuses to learn to drive a stick and it's old enough I don't trust it to do 40 miles a day a whole lot longer.
posted by anonymous to Work & Money (14 answers total)
If you aren't working now, do you have the time to try selling it yourself? You can probably get closer to the bluebook value, although it will be a big pain in the neck. If you can at least cover the loan, then it seems like it will be a much easier situation- and you can then decide what wheels better fit your budget.
posted by jenkinsEar at 1:14 PM on November 30, 2009

When you say you're not ok with strangers driving your truck, do you mean you're not okay with letting would-be buyers test-drive it?
posted by box at 1:18 PM on November 30, 2009 [1 favorite]

Do we stop paying it and let them take it away, and then buy a beater with cash? (Mostly joking there, I know that's not a good idea.) Do we try to sell it privately and start even? (I'm not ok with strangers driving my truck.)

There are some weird attitudes here about a car you're planning on selling and can't afford. I sold my car three months ago--and I had never sold a car before--via craigslist; it took three weeks and I got a price on it that I was very happy with. Sure, you have to let the other parties test drive, but you can stay in the car with them for that.

It seems to me that the best solution would be to sell your car privately, and (yes) buy a beater with cash.
posted by PhoBWanKenobi at 1:20 PM on November 30, 2009 [1 favorite]

I should point out that we do have a beater right now as well, but my lady steadfastly refuses to learn to drive a stick and it's old enough I don't trust it to do 40 miles a day a whole lot longer.

Also, what about selling both cars so you can purchase a slightly nicer automatic used car (er, "beater") outright?
posted by PhoBWanKenobi at 1:22 PM on November 30, 2009

These days, you can get a fairly decent used car for $12,000. All else being equal, that's what I would do - trade it in on a far less expensive car.

I do, however, think that provided its in good shape you can probably sell it on Craigslist for about what you owe on it.
posted by anastasiav at 1:31 PM on November 30, 2009

Buying a new car is never a good idea. Low interest rate or not, it's a huge waste of money compared to buying used. Might as well buy a 2-year-old car in good shape.

I guess if you won't sell it, you ought to trade it in for something with better mileage.

If you trade it in, a stranger will end up driving it, so keep that in mind.
posted by kathrineg at 1:31 PM on November 30, 2009 [2 favorites]

Dittoing that Craigslist is your friend here. Have the monster detailed (or do a super cleanup yourself) and advertise it for $14,500 or $15,000 (it's easy to come down, impossible to go up). Trade-in value is always way below what you can get in a private sale.

You should also check if there are any specific places where people take their cars to show for private sale, and if there are, hang out there for a few weekends with your shiny, clean *desirable* SUV.
posted by anadem at 1:37 PM on November 30, 2009

Sell it on Craigslist, then take the cash, pay off the loan, and buy a beater on Craigslist with the change (financing the beater if necessary).
posted by spikeleemajortomdickandharryconnickjrmints at 1:42 PM on November 30, 2009

I don't know what you consider a "beater". Everyone has different standards. There isn't an SUV made that I'd rather drive than any one of dozens of 10-20 year old sedans. My wife and my car have a combined total of 335K miles on them.

$12K gets you most anything you want. I'd generally recommend against AWD unless you live in the middle of nowhere where they don't plow roads at all. More complicated, and IMO, less safe in that you'll always be driving faster than you should on snowy roads. I live in Michigan, and I've had a couple of Audis and always found them overkill. You need snow tires and front wheel drive. My VW with good snow tires can get through 6 inches of snow without breaking a sweat. My BMW is fine in snow, even.

The safest bet is to get the newest/lowest mileage Accord or Camry you can afford with $12K. A wagon sounds like a good bet for body styles. Get it inspected, fix whatever is wrong with it, get some snow tires and enjoy it for its appliance-like reliability. If you decide you really need AWD, a Subaru of any type will do just fine. Again, suck it up and go with a wagon for practicality's sake.
posted by paanta at 1:46 PM on November 30, 2009

If you aren't willing to let strangers drive your truck, you're still emotionally attached to it or what it represents. Get over that hurdle and start thinking that it already isn't your truck.
posted by chairface at 2:02 PM on November 30, 2009

How long ago was the 12K trade in offer? The recent govt program to stimulate auto sales took a lot of late model SUVs off the road. Also, Dodge is halting production on the Durango until 2012. Especially if you have a Durango, I would check again on the trade in value. I've heard dealers are desperate to get their hands on Durangos in good condition.
posted by COD at 7:10 PM on November 30, 2009

$8000 per year is buying you transportation with this SUV (payments, insurance and gasoline,
excluding registration).

Doubling your gas efficiency from 15 to 30 mpg (on average) cuts your yearly costs by a 1000,
and yet you incur another 6 to 12K liability to do so (assuming you pay cash). It'll take you
between one and two years to break even on this purchase.

Putting it another way, you will be worse off for the next one to two years if you do this.
Personally, I don't think things have bottomed yet. It's going to get worse. Revisit this
topic in a year, without selling your SUV.

If your old beater breaks down, you can drive your wife to work. You might not have as
much leisure time, but it'll be worth money to do it.
posted by the Real Dan at 10:16 PM on November 30, 2009

I think you should sell it outright and buy a car in the $8000 range. There are plenty of good ones in that range and the math makes more sense. In addition to the typical Toyotas and Hondas, I'll put in for a Ford Focus or Pontiac Vibe (Toyota Matrix). I think paanta is spot on. Only lower the price to around $8000.
posted by luckypozzo at 6:10 AM on December 1, 2009

You should be able to afford a focus that can push 50mpg extra urban. These numbers are always dependant on a number of variables, and your climactic conditions mean that the heating will be on in your car a lot, I imagine. This will depress your number severely.

Your SUV is a massive waste of your money, get rid of it now. Surely, with a smaller, safer car your insurance will come down as well?
posted by munchbunch at 2:25 PM on December 1, 2009

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