Upside Down on Your Car, Want Out?

Several people today are upside down on their vehicle. They owe more money on their choice of transportation then it is worth. They can owe thousands of dollars more then they could sell the vehicle for. The main reason for being upside down is that vehicles go down in value as soon as the sweet car is driven off the dealer's lot. Another reason is the dealership sell vehicles at a premium compared to a private sale. Brand spanking new vehicles drop in value much more then used vehicles.

Some people think the only way to get out of the vehicle is to roll the loan over to another vehicle, which puts them deeper in the whole for a piece of equipment used for transportation purposes. This is a very sad situation since the new vehicle will drop in value and the rolled over amount is just digging the trench for the debt cycle. Why do we care so much about our vehicles? We use transportation equipment or a vehicle as a status symbol. We think if someone drives a BMW or Hummer they must be rich. The said truth is, if someone is wasting that much money on a depreciating asset, they may not be rich at all. Most rich people like to use their money to build more wealth instead of seeing their wealth go down the drain on a piece of equipment.

People think that there is no way to get out of the vicious cycle of car debt or being upside down on their car debt. The truth is there are ways out of this vehicle debt. It may be hard to grasp and you may need to get a new point of view of your situation to resolve this situation.

First: Look up the value of your vehicle on a source such as Kelly Blue Book. Write down the value both private party and trade-in. Most likely the private party will give you a couple thousand more dollars in value. You may even find that you are not upside down if you sell the vehicle through a private party sale.

Second: Clean that vehicle. A dealer or a buyer will look at a dirty vehicle and think it was misused or will cost money to clean it. Cleaning a car prior to listing it for sale will add value to the vehicle.

Third: Go down to your local credit union and let them know you are trying to reduce your debt. Take a personal loan out for the amount of the loan value you will not be able to recoup through a sale. This is the amount you will send to the loan company currently holding the title of the vehicle. Also take a loan out for a used vehicle to replace the one you are selling. The used vehicle should only cost you $2000- $4000.

Forth: Look for a used vehicle being sold through a private party, since you can get more bang for your buck. You can search used private party car ads through Craigslist and Autotrader.

You may feel weird driving that two to four thousand dollar vehicle, but once the car is paid off within a year you will be able to save those car payments each month. After a year you will be able to double your car value if you would like or start investing that new extra monthly income you now have control of.