Trading a vehicle that still has payments?

[bsmith104]

Has anyone ever traded in a vehicle that you're still making payments on? I need something with better gas mileage than my truck but I still have payments on it. How does it work out? Dealer takes over the loan or does the original lender just change what the loan is on?

 

[strider12]

Done it. It rolls over into the new loan. It sucks.

That's why I only buy used with cash now.

 

[bsmith104]

So let's say I have 10k left to pay and I get another 10k vehicle, my loan is 20k?

 

[linebacker]

The dealer pays off the loan and buys the vehicle. They of course want to get it as cheap as possible. They may not give you squat for it. Do your research before you trade your vehicle in. If you owe more than your vehicle is worth (to them) they will tack the balance on to the vehicle you buy. They love to see the "unknowing" walk through the door.

 

[strider12]

They will not do a loan that is more than 110-125% of what the vehicle you are buying is worth.

 

[linebacker]

So let's say I have 10k left to pay and I get another 10k vehicle, my loan is 20k?

no sir

 

[jwtug]

So let's say I have 10k left to pay and I get another 10k vehicle, my loan is 20k?

If you owe 10k on the car you are trading in , and it's worth 5k to the dealer, that leaves you a balance of 5k. That 5k would be added to your new loan for your new car. That's how they "pay off your car no matter how much you owe". You're still paying for it.

 

[strider12]

If you owe 10k on the car you are trading in , and it's worth 5k to the dealer, that leaves you a balance of 5k. That 5k would be added to your new loan for your new car.

If the vehicle is worth 2-3k.

 

[jwtug]

If the vehicle is worth 2-3k.

Right. That goes back to the 125% that you were talking about.

 

[rdogger]

Done it a few times.

Dealer makes an offer on your car.

If you owe 10k and he offers 9k, you roll 1k into the purchase price of the new ride.

Depending on your situation, car, mileage, goodies, you may not owe or may have some positive equity in the car.