How to get out from underneath this car? Need advice?
Husband made a bad deal on a car and i'm just trying to find a way out. We would like to completely get out from underneath this car or cut the interest down. It seems like no matter which way I twist and turn it we'd still be stuck in the same situation. So here's the thing
We currently owe $16500 on a 2012 ford fusion. Trade in value is $9k-$10k and private party value is around $11k so we're upside down. Our notes are 436/month for 75 months. Add that up and we're paying almost $33k when he financed $24k. I understand interest but holy cow that's almost ten grand in interest on a car!
Thought about these things
1) Would refinancing it under my name lower the interest?
2) Or maybe I could get a loan for $17k to pay off what we owe? But if I gets a loan for that much wouldn't I need collateral? My car is paid off but it's only worth about $10k.
3)Thought about just claiming bankruptcy and letting them take it, but that'll ruin his credit and stay on his report for years. Don't think that's the best option.
If anyone has any suggestions on how to solve this please let me know!
If he just bought it, He can return it back to the dealership unless he already did some serious damage on the car.
Well, there's no "magic" way to accomplish this.
1) Refinancing: Probably not going to happen. No bank is going to overallow that much negative equity onto a refinanced loan. Even if they did, they wouldn't drop the interest rate down to where it would be worth it.
2) Getting a loan for $17K: It's trading one loan for another, really, and interest rate on unsecured loans is usually higher.
3) Filing bankruptcy is an option if he wants his credit destroyed. Having it repoed pretty much guarantees the same thing. I wouldn't even entertain either if you can afford the payments.
If you don't need your car, sell it for $10K and throw the proceeds at that loan. Then, try to double-up on payments and get it paid off sooner.
Again… No magic way out of negative equity.
(** "John" - returning a vehicle back to a dealership isn't an option unless the dealer has such a policy. No law forces a dealer to accept a vehicle return.)
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