Hi My lady is suggesting that we move to a bigger car given our growing family, and I am inclined to get a new 2005/2006 SUV with capacity for 6-7 passangers (for around $30K).

Now here is the trick part. I financed my 2002SE (with 32K miles) last year for about $17.5K, paying about $360 per month. So far, I have paid only about $3k (this interest is a killer), and left with 14K to pay.

Now, we are considering trading it in. How will it work out. The car currently has about $61K miles. (those highway miles are a killer - 30k in one year?). I checked at Edmunds.com and the dealer trade in value will be about $10k. Assuming they find nothing wrong with it to reduce the value further, it would mean at the end, i will still owe the bank about $4K. This will be added to my new financial arrangement right?

Under what conditions will this make financial sense, particularly given its mileage and the fact that it is already out of warranty?

And if we migrate to SUV, what model will you suggest to give similar performance and reliability as the Max.

cheeers, MN

 

Trading in a negative equity car never makes "financial" sense. Heck, buying a depreciating asset like a car doesn't make much financial sense in general. But, sometimes circumstances force us to take a hit to get out of the car. You may also want to try and sell the Maxima privately since you will typically be able to get more than trading it in. I bet you could get $13K which would only leave you about $1000 negative. This time of year, you could easily make up that difference with successful negotiation with the dealership.

If you want to stay in the Nissan family, take a look at a Pathfinder. I believe the new generation is available with a 3rd row.

 

The above scenario is like being a homeowner in Austin, TX. People are 400k in, financed 80+ percent, and the selling prices are in the mid 200's. What do they do? They don't move, because they can't.

Just using common sense, why would a person finance a 30k car for 34k? The only sensible advice anyone could give is that the current Maxima must be paid-off with cash. Anything else is just plain dumb. Saying that one needs a bigger car for this or that reason is just rationalizing for something that's not affordable, again, unless the Maxima is paid-off with cash. my .02

 

yeap like the guys said, your gonna be losing money. if you do have the extra money to burn then go right ahead and trade it in for a titan or pathfinder. if you dont wanna burn that extra 4k, try not to have more kids until you pay it off.

 

say "no"

 

I have a used 2001 Nissan Quest for sale for 11,500 OBO its loaded with 39K miles, i'm about to list it in the F/s section but if your interested PM me! I know your not looking for a van but its just an idea?

 

I'd also wait until the warmer months, right now SUV's and anything remotely related to AWD or 4WD goes up in demand cause of the winter months and false sence of security with these types of vehicles.

The Pathfinder is not bigger then a Maxima, different vehicle but same general interior size

 

You can usually work out things with the dealership. That's why they are called "dealerships."

They will lower the price of the vehicle you are looking at (this is especially true with used vehicles) or give you more trade to accomodate your negative equity.

Say you owe $14k and the kbb trade-in is $10. You are looking at a barely used 2004 or 2005 SUV, maybe a 2005 Pathfinder with 15k miles on it for $27k. You work it out so that they lower the price of the Pathy to about $24k and they give you $11k trade on the car.

I did the same thing last spring. I traded in my 2000 QX4 for a 2001 QX4. I had about $3k in negative equity in the 2000. They wanted $21k for the 2001, but I ended up paying $20k for it, including the negative equity. Really, I fawked myself on the 2000, but bought the 2001 for $17k. If I had gone in there with cash in my bank account, I would not have bought it for more than $17k-$18k, even though they were asking quite a bit more.

The biggest factor is you have to be willing to walk away from any car if you don't feel comfortable with the deal. I bought my QX4 at a dealership 200 miles away. I worked everything out over the phone and through email. I sent pics of my 2000 to him. He called me back several times and I told him no to his offers. Basically, all I had to do was drive up there and fill out the paperwork.

 

Hmm. If possible, pay off your loan completely and then try to sell if privately. If you trade, as with most stealerships, they will be giving you wholesale for your Max and asking retail for the new SUV. If you have the time and patience, there are some dealerships that may be willing to go retail to retail but again that would depend on how desperate the dealership is. Also, I would hang tight for about a year as there seems to be a trend of mini-SUVs coming out. For example, the Acura RDX should be coming out by the end of next year. Also, not too sure of the timeline of the Infiniti "CX35" but that should be released soon after. If your in for a full size SUV and need the extra space, I have not heard of any glowing recommendations from any truck/car mags of one being superior. Factor in the added fuel costs though before you purchase.

Just out of curiosity, how high is your interest rate? It might be better to go through the manufacturer's finance plan but then again, that is if you qualify for the low rates and if it can be applied to any promotions they currently have.

Research, research, research.... can't say that enough..

 

I agree about the research part. I forgot to mention that I got a loan through my credit union for 4.9 percent, which is low for a used car.

I think he was wanting a large SUV with three rows of seats for hauling his family. Unfortunately, almost every 4wd SUV doesn't get more than 20 mpg or so.

The best one I know of is the Toyota Highlander and that does have a 3rd seat (folds into the floor), but it is kind of on the small side.