What would you do in my shoes? (Car question)

dkmw

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To give some idea:
My car loan is about $10k remaining. Interest rate is around 5%.

My credit card is about $5k, interest rate is 0% for about another 7-8 months (it’s the last of three cards to pay off, and was a balance transfer).

I may be able to get out of the car loan and into something more affordable without owing anything into it. If that’s possible, then maybe my mind isn’t as made up as it was a couple posts ago. But we’ll see.

You should look into re-doing the loan with a credit union, you can probably get a rate under 4%.
 

beninma

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To give some idea:
My car loan is about $10k remaining. Interest rate is around 5%.

My credit card is about $5k, interest rate is 0% for about another 7-8 months (it’s the last of three cards to pay off, and was a balance transfer).

I may be able to get out of the car loan and into something more affordable without owing anything into it. If that’s possible, then maybe my mind isn’t as made up as it was a couple posts ago. But we’ll see.

You should definitely look at refinancing the car loan.

I just looked, my credit union is writing 1.5% for non-members, 1% for members, and 0.75% for members if the car is considered energy efficient. And no payments for the first 2 months, which would allow dumping multiple car payments into the CC balances. A little unclear how you qualify for the different rates. Credit Unions will usually want you to join to get these kinds of deals, and my CU has some weirdness about joining, you need to be sponsored by an existing member in some cases or make a donation to a charity to qualify in.

If you qualify you can borrow up to 125% of the book value of the car or the purchase price.

The entire point of the program is to help people out of jams like you're in.
 

mfguitar

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Honestly, it sounds like you are doing great. $15000 debt is not huge if you are capable of earning money.
There is nothing worse than unreliable transportation. If you need a car to get to work then I would hang in there with the Hyundai, they are every bit as reliable as a Honda or Toyota. I would definitely look into refinancing if available, it looks like you would save $25 or so a month in interest alone and keep plugging away at the CC. Best of Luck!
 

naveed211

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Honestly, it sounds like you are doing great. $15000 debt is not huge if you are capable of earning money.
There is nothing worse than unreliable transportation. If you need a car to get to work then I would hang in there with the Hyundai, they are every bit as reliable as a Honda or Toyota. I would definitely look into refinancing if available, it looks like you would save $25 or so a month in interest alone and keep plugging away at the CC. Best of Luck!

Student loan and mortgage, too, so don’t pat me on the back too hard!
 

bcorig

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To give some idea:
My car loan is about $10k remaining. Interest rate is around 5%.

My credit card is about $5k, interest rate is 0% for about another 7-8 months (it’s the last of three cards to pay off, and was a balance transfer).

I may be able to get out of the car loan and into something more affordable without owing anything into it. If that’s possible, then maybe my mind isn’t as made up as it was a couple posts ago. But we’ll see.
All the better. Your CC payments will all be principal for the next 8 months. Work two jobs. Get it done.
 

Telekarster

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FWIW - I never pay a lot for a car. I always buy used and for the best deal vs. year vs. mileage I can find, but I can tell you from decades of experience in doing this, there's always something that needs to be done to them. I'm a mechanic so for me it's no big deal to do whatever is required to get a used car in top shape for the road. However, if I were to pay someone to do what's needed for most of em it would probably cost me 100's if not 1000's of $$$$, which obviously would cancel out whatever deal I got. The used car market right now is as bonkers as everything else, so your odds of getting anything even 1/2 way decent for 2K is probably going to be pretty tough. And, even if you can find something, it's probably going to need 100's or 1000's of $$$ to get it reasonably reliable unless you can do the work yourself. Anyway, just something to think about and hope it helps! Good luck!
 

Cpb2020

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Circling back on this with another data point. A buddy with a 160k mile Honda CRV had a coolant line (runs near the engine block) let loose over the weekend. His mechanic said that the part is out of stock with 900 orders ahead of him in the US, making the car useless for the moment.

This suggest that beater repairs are proving more difficult given the scarcity / supply chain issues.
 

Drew617

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Car prices, used and new, are crazy right now. A $1000 high mileage beater in 2019 may $4000 or so now.

For example, I traded in my awful 2015 Chevy Sonic (71k miles) a few months ago and the dealer, instead of sending it right to auction, sold it for $10k within a week or so. It was the cheapest used car on their lot. They were selling Japanese and Korean small cars with higher miles (100k+) in the 12k to 17k range. I've also been told that I could sell my new 2021 Ford Ranger for more than what I owe on it. Insane!

You may want to wait until car prices stabilize somewhat, hopefully when supply chain issues get resolved. But, there's also the looming specter of inflation which will send prices higher anyway although if you have significant loan debt this might not be all bad.

I bought a 2017 Pilot with 31,000 miles in October 2020 for $24K, had it driven into by a 90 year old while parked in front of the dry cleaner, had a mediocre bondo job done on two door skins by a shady body shop who defrauded the old guy’s insurance carrier, then traded the Pilot at the Toyota dealer in June 2021 with 38,000 miles for $26,000.

The used market is bonkers this year. In the best case I think one may be able to break even if a valuable trade is inflated about as much as the replacement. You may not have the same benefit (a favorable offer contingent on another purchase) when unloading, and I think the low end of the used market is relatively more inflated now than the commodity/off-lease space.

Of course, nothing’s valuable like cash in hand, but I think the proposed move may be even more costly now than it would be with the market in equilibrium.
 

tfarny

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If you can't fix it yourself, a $2000 car off Craigslist is a big gamble. Mechanics are not cheap, at least around here. Is the car "sensible" transportation, or did you buy a sports or luxury car that you can't really afford? Is it something you could conceivably pay off and then drive until it's 15 years old? The quick fix is not always the better fix. I'll leave you with:

 

mtglick

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Just repeating what most have said. Refi the loan. Keep paying down the cards as fast as you can. Then attack the (now somewhat cheaper) car loan. Once you've gotten out of debt, make that same payment, every month, to savings. Your (newer) car is now paying you instead of the other way around, as you'll have a more reliable car, and then eventually the cash on hand to make repairs, instead of borrowing more money to buy another car or go into more debt to fix the one you've got. It's a real-world application of "buy cheap, buy twice", but in this case, you'll replace that $2K car three or four times, plus repairs, before a $10K car will need the same level of attention as any one of the $2K ones.
 

naveed211

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Is it something you could conceivably pay off and then drive until it's 15 years old? The quick fix is not always the better fix.

It's this.

If I'm diligent I could pay it off in probably a year and a half or two years.
 

tfarny

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It's this.

If I'm diligent I could pay it off in probably a year and a half or two years.
Then I would keep it and drive it until it had maybe 150 k or so and you have cash to buy a replacement. After maybe 150k (who really knows) your repair costs tend to rise so that replacement starts to seem sensible.
 

Fuelish

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Hell, our 2010 Kia Forte got rear ended in June….. the inattentive pastor that hit her, his insurance co decided our car was “totaled”…… offered us $8900 for a totaled 2010 car with like 160,000 miles on it…. We took the money and ran to the Honda dealer
 




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