Clunker Query

In August 2009, I rushed to trade in my “clunker” -a 2000 GMC Safari High-top conversion van, for which I received the $4500.00 allowance (about what its book value was). Due to time restrictions (“You’ve only got one week!”), I quickly settled for a 2009 Nissan Rogue, no down payment, 2.9% financing (my monthly payments are over $400.00). I did not attempt to ask for further reductions. Now I regret my hasty decision, not so much about the car itself, but about the financing. I’m paying more per month than I want to. What really miffs me is that car dealers continue to offer trade-in allowances of $4500.00, and my van might have gone to someone who would have enjoyed it, instead of heading for the squash pile. If I had more time to consider, I might have chosen another more “cost-effective” car and looked for better financing. So what should I do now? Trade over the Rogue for something more economical? Re-finance? Wait a year then trade it in?

Financially… your best bet now is to drive it until it’s paid off. Then, drive it until the wheels fall off, then repair/replace said wheels, drive until those wheels fall off, then sell it private party, all the while saving a little bit each month and paying cash for your next vehicle, which should be a vehicle a couple years old @ the time.

I think you know now never to make a major purchase in haste. Any time a dealer says that if I don’t make a decision immediately, it will be too late. I then tell the dealer that I’ve made up my mind not to make the purchase and walk away. Dealers have played this game for years. Your best bet now is to keep driving the Nissan. It’s a good vehicle and gasoline is way behind depreciation, finance costs, etc. in owning a vehicle.

Paying for the new vehicle is the toughest part of owning it. You have to discuss it with your bank. Their advice may be free and they would know what your options are. You have to bring your loan contract with you. Trading cars causes more debt because you won’t be given enough money for your current car.

Let’s say you put the Rogue on the road for $22,000 and financed $17,500. You probably still owe almost $17,500. If you are lucky, that’s what you will get for a trade-in. You won’t have the loan, but you will lose $4500 in purchasing power. If you can afford the loan, you should reconsider selling the car. That lost $4500 is one quarter or more of the car you would replace the Rogue with. I’d keep the Nissan and learn a lesson about decision-making, but only if you can actually afford to. Have you thought about a second job?

We all knew it would end up a numbers game.
I could have dumped my great 92 Explorer then too, but in c4c I could not have gotten another Explorer !

I still have the 92.

Your mistake was going from a clunker to a new car. Regardless of the allowance, it’s too big an increase in financial commitment for most and they didn’t do the math. Getting half as much trade in on an 07 Compact SUV would have made more sense. Another “too good an offer to pass up” that hurts many impulsive buyers.
Listen to the advice here and don’t trust anything that’s too good to be true.

The reason you drove a Clunker was that you could not afford a new car…You still can’t. Nothing has changed. You lost the Clunker and you are flirting with losing the new Rogue…

Don’t feel too bad. We’ve all made poor decisions. You do have a good interest rate at least. My last car purchase was a new Toyota that I traded in my volvo for that was giving me lots of problems. I traded it in and didn’e even get half of what I owed for it! I’m half way through a 6 year loan on the new car w/ a 7% interest rate, but I learned a lesson. I’m taking very good care of this car because it’s going to last me a loooonnnnngggg time! Also i learned how much I hate car payments!

Thanks for your reply. Sounds like I should have held on to my “clunker” which really was in great running condition, but I was ready to downsize into something smaller. Happy New Year!

Thanks for your reply. When will we ever learn? Happy New Year and drive safely always!

Thanks for your reply. I could have relied a bit on my home equity line of credit to put down a down payment which has a relatively low interest rate. Maybe I should discuss it with the car people first. Happy New Year!

Thanks for your reply. The clunker trade-in was only good on new cars, unfortunately. Did I do my part to help the economy? LOL. Anyway, hope you have a happy new year!