When you want to sell your vehicle but really shouldnt

[ufcrusher]

As I mentioned before, I am facing a cross country move and need to get 2 vehicles across. When I bought my latest truck in 2004, our sales man convinced us to use some "creative financing" that resulted in the payments being lower but giving us a lump sum on the back end. All in all, it ended up being almost 0% apr on the loan over a longer period than the dealership/manufacturer would have ever gone and below invoice including all payments/interest.

Unfortunately since its backloaded the payoff is out of wack with what the truck is worth. I booked out the truck and of course its value is either exactly what is owed or there is so little difference (positive or negative) that its virtually a wash. With all of the incentives the companies are putting on buying new models (mine is a 2004...and the 2007's are almost here) there is no way I am going to get full book on my truck. So its either take a loss to just get rid of it or keep it and move it. I wanted to get a new car when we moved but dont want to take another loss...I would rather keep my current vehicle than lose money again. (I took a loss when I was forced to get rid of my last car due to bad advice from the salesperson on trying to sell it myself)

This just sucks because even though I can treat it as a wash and just buy whatever I want, i would completely lose the equity that I put into this one from the last car. I swear the advisor forgot to take into consideration that by back loading the payment I was basically using my previous equity as a down that was locked into the vehicle. Ugg.

[DarkFury]

So why did you let them sucker you into that kind of financing deal? I know you are a smart guy and all... but fool you once, shame on them... fool you twice shame on you! (Personally, I usually go into a car purchasing deal with my financing already in hand... so that they can't stroke me on that deal.)

At this point... why not keep it (since you've already taken the depreciation hit) and pay it off? Is it giving you problems? Or do you just have the "itch" for a new vehicle? Personally, I'd get a u-haul trailer, put your car on the back and tow it with the truck... that way you can move both vehicles.

[Houdini]

Yeah, car salesmen can really suck. I was even in a Ferrari dealership the other day, admiring their wares and a used Lambo Gallardo, and all the salesmen were saying, along with big signs on each car, "don't touch the ferrari." That kind of pissed me off, because for all they know I may just drop down 100k or so and drive off into the sunset. Then again, I'm broke now.

When I last was involved in a car transaction, the salesman was trying hard to screw over one of my brothers when he was buying a new Mustang. The asshat didn't honor a written agreement, etc. I played "bad guy" and stormed out a few times, encouraging my bro to do the same. His gf was also pretty good at negotiating. At one point, the salesman said, "I'm not trying to make any money on this sale." I said, "Yes you are, it's your damn job."

Regardless, even if you bring in all the info from invoice to insurance to financing, like casinos, the dealer will always win somehow, whether its from a financing scheme, "no really, like I said, the interest rate would be closer to 4% than 5%. Me: OK. Salesman: so I'll just put you down for 4.95%" all while talking really fast. I asked him not to insult my intel, and stood up. He then made a telephone call "to ask a favor of the financing people." BS. I ended up getting a pretty good deal overall, but I still got suckered into the damn window and car-parts etching, which as far as I can tell, was never done, as I drove the car off the lot after trading in my '91 Camaro.

I guess what I'm trying to say, I disagree that intelligence has much to do with it. Thinking on your feet and doing complex math in your head is a plus, but the dealers really know what to do, And that sux.

[ufcrusher]

So why did you let them sucker you into that kind of financing deal? I know you are a smart guy and all... but fool you once, shame on them... fool you twice shame on you! (Personally, I usually go into a car purchasing deal with my financing already in hand... so that they can't stroke me on that deal.)

At this point... why not keep it (since you've already taken the depreciation hit) and pay it off? Is it giving you problems? Or do you just have the "itch" for a new vehicle? Personally, I'd get a u-haul trailer, put your car on the back and tow it with the truck... that way you can move both vehicles.

Not sure I am really following what you are saying here, no matter how I slice it, the deal itself was good. What we were misled on is how easily we would be able to get rid of it. If I wanted to walk away and be done I could....I just would get no equity so it would be the equivalent of turning in a lease. Great if you dont care about the money you should be able to get out of the sale...but frankly that is part market, part dealer. On that front, yes it could probably count as fooling me twice after what happened with the Mustang, but this is more due to the price of gas driving down the market for full size trucks with gas slurping engines and the manufacturer trying to give great incentives to get people into them. New car with incentives for the same price as a 2004 model with 11,600 miles.

[Daedalus]

So you're fairly even on current value, and you wish you were more ahead? Don't let that drive your future decisions. Sounds like you've been paying less than average up until now. Having more equity now would have meant having larger payments in the past. It's the trade-off made and it's done. Same for the external factors--they are what they are. You can sell it and walk away, or you can keep making payments, with a balloon on the horizon, and the vehicle will keep depreciating. Eventually it'll be worth more than you owe, but it'll cost you even more to get there.
It really depends on more things than what you've stated, but sunk costs should be ignored. Focus on the things that really matter, like future finances, personal preferences, etc. Cars should be about more than just debt/equity.

[DarkFury]

Not sure I am really following what you are saying here, no matter how I slice it, the deal itself was good. What we were misled on is how easily we would be able to get rid of it. If I wanted to walk away and be done I could....I just would get no equity so it would be the equivalent of turning in a lease. Great if you dont care about the money you should be able to get out of the sale...but frankly that is part market, part dealer. On that front, yes it could probably count as fooling me twice after what happened with the Mustang, but this is more due to the price of gas driving down the market for full size trucks with gas slurping engines and the manufacturer trying to give great incentives to get people into them. New car with incentives for the same price as a 2004 model with 11,600 miles.
Pretty much, what I was saying is... you let them talk you into a deal that ultimately you became uncomfortable with. Yes, you took advantage of the "cheapness" of the payments early, but now you gonna get the punishment. Kinda like the balloon payments on a mortgage. Personally, I try to avoid deals like that myself.

I still stick by the thoughts that even if a pickup truck is a gas slurpin' monster... they still have their useful places in our daily life, therefore I'd always want to own a truck (preferably a "PAID FOR" truck) which gives me a little bit of independence to do certain things on my own terms and not be tied down to someone else's contracts, commitments, or whims. For me having a car and a truck just for my own needs (i.e. the S.O. needs her own vehicle outside of those two) is optimal, therefore I was recommending that you just keep it and pay it off.

[LegendKiller]

So you're fairly even on current value, and you wish you were more ahead? Don't let that drive your future decisions. Sounds like you've been paying less than average up until now. Having more equity now would have meant having larger payments in the past. It's the trade-off made and it's done. Same for the external factors--they are what they are. You can sell it and walk away, or you can keep making payments, with a balloon on the horizon, and the vehicle will keep depreciating. Eventually it'll be worth more than you owe, but it'll cost you even more to get there.
It really depends on more things than what you've stated, but sunk costs should be ignored. Focus on the things that really matter, like future finances, personal preferences, etc. Cars should be about more than just debt/equity.

I am more inclined to agree with this.


.

In the end, all you can do is stop from being suckered as bad as the other guy. No matter what, the dealers will make money. It's a distribution. They know that some people are going to get a dang good deal, relative to other people. However, they also know that this will be balanced out by the people who don't negotiate hard and get a crap deal, relative to others.

It's just like jewelery stores, you are always going to pay more than a diamond is worth, no matter how good of a negotiator you are.

[Cubsfan]

Regardless, even if you bring in all the info from invoice to insurance to financing, like casinos, the dealer will always win somehow,
Well, in order to make money, they do kinda have to win most of the time.

However, I've found that I get the best deal if I buy at a high-volume, low-service dealership. They generally realize that if they make a few hundred dollars, and it only takes them 10 minutes, then it's worth it for them. If a salesman has to spend days with you trying to get you to buy the car, then I think they are less inclined to give you a good deal.

[attgig]

put a craigslist ad out there for the price that would make it a wash. if you get a bite, sell it off. if not, take it with u.

[ufcrusher]

At this point, I think I am just going to keep it for the time being. I just have to decide whether to drive it or ship it cross country. Although I still worry whether it will be an acceptable vehicle where we are moving.