Advice if Regretting SUV Purchase
I am "underwater" on my car loan by about $10,000. Do I have any options other than paying off the whole amount?
I am "underwater" on my car loan by about $10,000. It's an SUV that I regret purchasing in late 2007. Do I have any options other than paying off the whole amount and selling it for whatever I can. Thanks
Unfortunately, you're on the hook for this loan. While many folks - and the auto companies themselves - have come to realize that the market for SUV's is not what it used to be, keep in mind that when you buy any new car, it immediately is worth less than you paid for it the moment you drive it off the lot.
With the exception of collector-grade vehicles, automobiles are not investments, and should never be thought of as such. Rather they're a (rapidly) depreciating asset. In fact, most vehicles lose 10% of their value the second you drive them from the dealership, a full 20% by the end of the first year of ownership, and 50% after five.
For this reason, many people choose to buy used - or, as their often called these days, "pre-owned" - vehicles. This way they get an almost-new car for a fraction of the price paid by the original owner.
To find the market value of your vehicle, I suggest visiting sites such as AutoSite, Kelley Blue Book, Edmund's Automobile Buyers Guide, and CarPrice.com, for pricing information and selling and buying tips.
If you financial situation is so severe that keeping up with your payments is becoming difficult, I suggest talking to a bankruptcy attorney in your state to find out more about possible options. (Collection, lending, and bankruptcy laws vary from state to state, hence the need for an attorney specifically licensed in you home state.)
You can also read more about debt consolidation, debt relief programs and alternatives to bankruptcy at http://www.bills.com/debt-consolidation/. This site also offers a "savings center" where you can apply for a free debt-help quote from pre-approved lenders and program providers.
Best of luck with this difficult situation, and I hope that the information I have provided helps you Find. Learn. Save.