Long-time listener/lurker, first time poster.
I have a situation and I need some advice. I own a 2010 Toyota Corolla S with 47,000 miles. It needs a new front and rear bumper and two tires. Mechanically it’s just fine but it looks like crap on the outside. I owe $10,300 on the car, which is more than it’s worth so I’m upside down. It’ll take me 4 more years to pay the rest of it off and the car no longer has any warranty coverage whatsoever.
I work in car sales and my dealership is offering me an attractive deal on a 2014 Mitsubishi Lancer SE. They’re willing to pay $8000 for the Corolla and work the negative equity into the car deal. I’m thinking about a 3 year lease (12,000 miles/yr) at the SAME monthly payment as I have now and full warranty coverage. If I “sell” this car to myself, I’ll get $300 commission kickback and I’ll also get any money the store makes on the Toyota beyond the cost of the needed service.
If I decide to keep my Corolla, I’ll pay it off in 4 years and it’ll have probably over 100,000 miles by then and be worth far less than $8000. From this point forward, any necessary repairs will be coming out of my pocket. Also the Lancer gets better gas mileage than the Corolla, it’ll be brand new and covered by full warranty, it’ll be AWD instead of FWD (important in Minnesota), and I’ll get free gap insurance and free navigation installed, all for the same monthly financial commitment.
The only problem is that I’ll be pretty limited regarding the amount of miles I can drive, I won’t end up with anything to really show for it when the lease is up, I may have to deal with wear and tear fees, I may have to pay $0.15 per mile on any miles over and above the 12,000 mile limit, and I’ll just have to either lease another car or buy the Lancer and incur another several years of car payments.
I’m stuck and I don’t know if I should keep driving my Corolla and pay it off or try out a lease for the same monthly price. Any help from you guys and gals would be much much MUCH appreciated!!