I want a new car, if I trade in my car after my first purchase 7 months ago, how can I keep my payments low?

Question

I purchased a 2005 pontiac g6 7 months ago, however, I really want a new car! Although, my G6 runs great, I really want to purchase something like the new Ford Edge or a similiar small truck (yes, still, with the way gas prices are!). My income has not changed, nor has my credit score. But I REALLLLLYYY desire the Edge. How can I do a trade in without significantly increasing my car payments? I am prepared to go up just about $100.00 more a month.

Answer 1

It depends on how much you still owe on your current vehicle.  I have Car Sales experience.  Put it in your notes and I will be happy to help.

Answer 2

The way to keep your payments low is to make a lot of money, and pay for stuff. If you have a million dollars in the bank, your car payment would be Zero.  That's how this money stuff works.

Answer 3

Rule of thumb - $100 per month equals about $5000, financed for 5 years.

You have to pay the current loan in full. If the trade-in value of your car is worth X, and the balance on your loan is Y (hopefully X>Y), that means you can afford another car worth X-Y+$5000. If the math works, great. If not, you have some options.

One - pay the difference in cash.

Two - sell your car yourself. The trade-in value is less than the dealer will sell it for - he wants to make money. The amount you can sell it for will be somewhere between the two, resulting in more money in your pocket.

Three - wait a while, and put that extra $100 per month in savings to use as a down payment. Do you get paid bi-weekly or semi-monthly? Divide your car payment accordingly and make a payment every payday - the loan balance will go down a little quicker.

Also, if you buy used cars, you can trade more often, because they don't depreciate as quickly as new cars.