Major trade-in dilemma

princessdiana75 · 09-02-2005, 07:26 PM

It's a pretty long story, but i NEED help ASAP.

I am 19 years old and have *almost* been licensed for a year. My parents wouldn't let me drive until i was 18 and my mom wouldn't let me drive until i had my own car. So she traded in her suzuki xl7 and got a car for herself and a car for me from a used dealership. My car is a 2002 suzuki aerio in decent condition (24,000 miles; runs prefect; etc.) and it was $8,500.
My mom has HORRIBLE credit. So she has two loans, one for my car and one for hers. (but i have paid every penny of my car over $5,000 i've paid on it and i've had it for 1 year 1 month). I'm not gaining any credit in my name because I have no assets since the car is in her name, and it's hurting her credit to have so many loans (she has more than just the two cars). So I'm really looking to try and get a car in my name. However I still owe $7,200 on the car (with interest) i'm not sure what the pay off is. But I definitly can't afford it.

(I have a very good job but i live far from work and between my high insurance rate (mostly because of my age and minimal driving experience) and the high gas prices i really don't have that much money left over every month to pay more on my car.)

So basically, I definitly can't pay my car off, but i need to get a car in my name. I've decided the only thing to do is trade it in, but i know i'll probably get screwed. If anyone has any advice for me PLEASE help ASAP. I'm looking to trade in my car this week or next week.

Also, if anyone has any advice for cheaper insurance rates or cheaper monthly payments on a car without getting screwed in the long run, please let me know. I'm soo stressed out trying to figure out what to do.

Just an FYI - my car payments now are $215/month and my insurance is $242/month. (my car is titled to my mom, and i'm under her insurance b/c getting insurance on my own is even MORE expensive). And I live in Pennsylvania if that means anything....

MagicRat · 09-02-2005, 10:54 PM

It sounds as if you are in a bad deal. You bought the car for $8500, you have paid $5000 off on the car but you own $7200??

This only makes sense if your mom is paying staggeringly high interest because as you say, her credit is bad.
And you get screwed because you are paying very high interest because its her credit rating and not yours.
This is compounded because you IMO bought too much car; the payments are beyond your means.

IMO dump the car. Likely you will not get anything for it; the balance on the loan equals what its worth.

Get a cheaper, older car in your name. Get a loan in your name and try to find someone to co sign. Chances are with your good job you can get a $2 - 3000 loan or lease.

Get your own insurance. Since you have been insured for more than a year (hopefully accident free) you will be amazed at how much your insurance will drop if you shop around; especially with an older car.

Igovert500 · 09-04-2005, 05:39 PM

Yeah, I'd go with a similar course of action. I'd try to sell the car to somebody who could take over the loan payments or pay you the amount you owe, plus a bit to pick up a new car. Or trade it back in...whatever, just get rid of it.

Now definantly time to branch out on your own, insurance and title-wise. When I bought my car, my mom's credit wasn't that hot either, so I paid half up front and got a loan from my bank for the other 50%. The loan went in my name, but my aunt was the co-signer...not my mom.

I'm building good credit with that, the car and loan are in my name, etc. Insurance is as well.

To get lower rates, there are plenty of things to do. Here are a few off the top of my head. We also have a section on insurance in teh FAQ for the Mitsubishi 3000gt section. I'd check it out, because it has some other ways to lower your rates.

1) good student deduction, some companies do this, if you are still a student, show them a good report card or grades from a semester with a good GPA, they may give you a deduction

2) Take defensive driving. In NY it was a 6 hour course, cost me $20, and it took off 10% of my car insurance.

3) Get your VIN etched into your windows of your car. Some police stations offer to do this for free, if not you can find kits online to do this. Many companies will give you a deduction for this, as well as other anti-theft features, like an aftermarket alarm, etc.

4) Pay your payments half a year at a time. Progressive will give you a $100 or so discount if you pay 6 months at a time, rather than monthly. If you can afford this go for it, but make sure to ask for the deduction, because they wont offer it unless you ask.

5) Raising your deductible can give you a discount. Many would say this isn't worth it. For instance, if you have full coverage, you probably have a $500 deductible that you would have to pay in the event of an accident. I raised mine to $1,000, and this lowered my rates. But be careful, because this can come back to screw you if you don't have the 1k to pay if you do get in an accident.

6) keep a clean record, as you get older, many companies drop rates significantly at random years between your 18-25th birthdays (I'm guessing you are around that age), if you keep a clean record.

7) you could get married...kinda kidding, but this actually does lower your rates.

Yeah there are other ways, mentioned in teh FAQ, so check it out.

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