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  1. #1
    Sr. Apprentice
    Join Date
    Jul 2010
    london ontario

    Default car payment question

    hey guys i have a math problem that im trying to figure out
    i don't really have a use for a truck anymore and with gas i think i might try and sell/trade it in
    i found a few cars i might be interested in at a used dealership
    price of car: 10,995 + 13% tax = 12424 + licensing (lets say 12500 even)
    i still owe $3,806 on the truck but the hard part is finding a price to sell it at
    04 4x4 127,000kms 12k
    04 4x4 380,000kms with 5.3 for 7450
    02 4x4 with 210,000kms for 7700

    i have mine on local kijiji for $6700
    extended cab, 210,400 kms, 4.8L engine, RWD, aftermarket power door locks, flowmaster muffler and brand new tires

    so if i went to a dealer for a trade would it work like this?:
    car 12500
    ask 5500 for truck
    car is now 7000
    and then roll in the remaining 3806 i owe on truck onto 7000?
    so car is now 10806 and lien on truck is cleared and get new loan for new car

    but if i sold truck privately for 6500:
    pay off loan of 3806
    i now have 2694 cash in hand
    car with tax is 12500
    put down 2694
    finance car for 9806

    and i am looking at cheaper cars in the 6-8k range as well

    but the main point is the balance i owe will be added to the price of the car right?
    2003 silverado extended cab 4.8L

  2. #2


    Yes you can roll the negative equity from your truck onto your new loan. And yes that would "free" up the truck. The problem with doing that is if you finance it you may pay higher interest rates. Than you will be upside down on the new car, and pretty much will be until it is paid off. I did something similar when I graduated boot camp.

  3. #3


    If at all possible sell your truck to a private owner, the dealership will normally try fancy footwork and get you twice and reduce the amount of your trade as much as possible.
    First they'll insist on low book for your truck even if it's clean and could be considered high book value because you owe on it, the difference between this amount and high book can amount to thousands of dollars depending on the vehicle, at times I've seen this amount add up to more than the remaining balance on the vehicle.
    Then depending on how the financial regulations are written where you live they can take one of two routes, they could take the remaining balance on the truck and deduct it from the trade in value, or they could roll the remaining balance into your new car loan.
    Most will roll it if it's legal where you live because that gives them a higher loan balance to sell to the bank, higher loan balance = more borrowed $$ which means even if you have a low percentage rate they still make more money from you. To confuse things a little more they make interest off of money you've been paying interest on for the last couple years.
    No matter how bad you want that new car it's always better financially to sell your present vehicle outright to a private owner or pay-off before trying to trade in.

  4. #4


    All good responses here... As someone who has always traded in at dealership, I can say that you can get more $$ selling it privately. The only problem is you have to sell it yourself. Figure out the value of the truck and what you need to get out of it. Then pad the amount when advertising as you will get chewed down... hopefully not past the amount you want to get out of it.

    Good luck!
    06 Chevy Silverado V6 4.3 Reg Cab
    71 Chevy Nova SS 350 SB

  5. #5
    Sr. Apprentice
    Join Date
    Jul 2010
    london ontario


    thanks guys

    i've replied to a few dealership ads (hyundai and subaru etc) and put an ad on kijiji for $6500

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