Well my wifes employeer announced yesterday that everyone is getting a 5% paycut and up to 300 would be out of jobs (praying the good Lord will save hers)....That along with our first child due in October and her Crappy insurance. It seems like we need to get rid of the truck and downsize a bit or at least get an older one. to free up some money.

My question is have any of you guys Sold your truck that you owe more than its worth? I dont want to trade because of the negative equity i would really love to sell it outright..I know its a bad time to be selling a big truck but has anyone taken a small loan to pay off the difference of what they can get out of the truck ?? I am really thinking about doing basically i owe 14k on truck, its worth around 10-11k private party, like 8-9 on trade in..No thanks....and retail is right around the high 13's. So if i could sell it for maybe 11k and take out a 3k loan to pay the difference and get an older truck with a cheaper payment i could loosen up some money....Just my thoughts but i would love to hear from someone that has done this or has not done this and why.........Thanks!!

By the way....Dave Ramsey recommends me doing this haha!!

 

drive it thru yours wifes boss's house then collect ins.
yeah i know thats stupid im just venting for you

 

Your upside down 3k, if your payments are like mine then that's about 8 payments left to break even. If you can, I would hold off those 8 months or at least a little longer.

I was right side up when I lost my job, but without a paycheck I though about getting rid of the payment. Then I considered, I had a nice truck, less than 10 years old that is very reliable and I've know since it was ordered (I bought it used from my company). I would have made probably 6k selling, but a 6,000 dollar pick up isn't half as nice as mine or half as reliable. I mention this because, you have a newer pickup, either way you will have a payment, which would you rather pay for, the truck you have or one that cost you less? I heard somewhere about refinancing a vehicle loan, have you explored lowering your payment?

 

What do you use the truck for? If it a daily driver I would sell it and get a small ranger or something so you still have a truck. It's better to secure your family than keep the truck!

 

your logic doesnt work. Sure, maybe if he waits 8 months he will only owe the 11k on it, but now the truck is probably only worth about 9.5-10k. Its close to impossible to catch up unless the loan is almost paid for, which I doubt is the case since he owes 11k

 

Look at the basic facts:

Sell the truck and take the proceeds and borrow 3K to pay it out. Great...but you still don't have a vehicle, so now you need to borrow more money to buy an older truck.

Have you really saved anything? All you've done is moved being upside down on a new truck to being upside down on a used truck. And instead of being 25% upside down, you'll be 50% upside down.

 

Juggling finances...I can definitely sympathize. I think everyone gets bitten by finances at one point or another. I had the added challenge of being a platoon sergeant for over 100 troops. You learn all kinds of things while "governing" that many bodies!!

If either you or your wife have some type of retirement plan, take a look at the fine print for that. You might be able to take a loan out of your retirement funds. On the bright side, you will generally be borrowing money from & repaying yourself.

If you have a credit card with a minimal (preferably no) balance, you could use one of the limited time offer checks to write yourself a loan. Even if your credit card company already sends you the "write yourself a loan" checks, you can always give them a call and see what else they can do for you. Credit card companies like to make money. (Duh) So it may be necessary to use the "false competition" ploy during this call. If they give you some crappy balance transfer option--like 6 months @9% interest--tell them that you have a better rate from another card. (Be prepared to provide an example, but be realistic with that example.) They will generally at least attempt to make a counteroffer. To give you an idea, I have one card that will almost always offer a 1.9 - 4.9% rate for the life of the transferred balance.

Talk to your bank(s). In some cases, a bank can extend you a debt consolidation or home improvement loan with a good interest rate. Granted, this money is not going to improve your home, but they do not need to know that. And, on the bright side, both of these types of loans are signature loans (they do not require collateral).

 

I would say keep the truck if you are upside down in it. I speak from exprience. You will only end up deeper in the whole by selling yours taking out a loan to pay it off and then borrowing money to buy a used truck that will depreciate faster than you can pay for it. Plus then you will have a payment on a signature loan and a vehicle loan and in the end you add those two up you will be close to or maybe even more than the payment you have now. (again I speak from my own stupidity) If you can try to make a couple of extra payments to get ahead on your current loan and that would give you a little cusion if you get into a bind one month. Belive me you are better to keep what you got and tough through it than sell it. I have learned that the hard way owing almost double now on my 06 than what I thinlk the wholesale market would bring for it.

 

personally alot of what everyone has said is good. I myself would look at two options:
First being to refiance either thru a credit union if you have one or a local bank. Goal would be to reduce the payments by refinancing over a longer period of time. Hopefully a better interest rate to go with it.
Secondly, Just test the market with a 4-sale sign and see if you can get a buyer for what you owe on it.

With the second option you will not be doing yourself any good if you are just going to go out and get another truck or car for that matter. Consider some additional costs with that option like taxes and tags.

work on option 1.

 

agreed completly..

if ur upside down, ur only option is to ride it out, keep the truck u have..

least u know what u own.. gonig farther upside down to get a smaller payment on a even older truck, might be more headache..

who knows what condition anything u buy might be like..

 

If you can't ride it out, try taking out a small loan on what you owe, search around for a low interest rate although used vehicles are a little higher, check it out. Banks, credit unions seem more reluctant to issue smaller loans, less risk, good luck.

 

Take a second job in the evening (pizza delivery?) and pay the truck off as fast as you can. That is the only way you can get out of the debt without having to shift the debt load to something else.

 

Hang in there and keep the truck. You will only regret selling it for less than you owe only to buy something older that probably needs more money sunk into it to get it running...


By the way...Clark Howard said its a bad idea!!

 

Get a personal loan, or a credit card check and pay the truck off. Title in hand and it's yours even if things get worse. Right now if you miss payments the truck is gone. With the value of your truck you're not gonna downsize much in payment so just find the way to keep it.

 

You can't sell or trade your truck without satisfying the loan (pay it off). In today's credit crunch I doubt you could even get a loan on a different vehicle without a large down payment. That means you can't carry over losses from your truck into a new loan. And you certainly won't refinance for a sum greater than the value of the truck. At the end of the day, these aren't even options for you.

Bottom line is that you have a cash flow problem. The only sensible answer is to free up cash flow and pay down the truck quickly. When you get to a break even point you can decide if you sell or keep. (Probably going to sell with a new mouth to feed and medical expenses. A lifestyle change might be in order here.)

You're in a situation that will take sacrifice to overcome. Have a yard sale; sell another vehicle; drop the cable television; don't eat out; pack lunch for work; drop the cell phones; buy groceries with coupons; cut all spending on clothing, entertainment, and non-essentials..... just free up any and all cash you can! I've done this same thing before. You will be amazed how much money you save each month. Based on my own experience I wouldn't be surprised if it comes to $500 - $1000 per month.

You can do a quick fix by robbing from your retirement or home equity. But that is going to cost you a lot in the long run. It's smarter to leave your retirement alone and just temporarily reduce contributions to increase take-home pay.