Trade my new car for two used ones...?

Question

I have bought a new car thats worth 17k and did 3k down on it and payed about 1.5k off. Soon my wife needs a vehicle of her own just to get to work, school and back and was wondering if I can trade my new one for two used ones? Maybe 5k for each for the two used cars? Will this be possible?

Answer 1

Sure.  But you most likely owe more on this new one than its worth.  $3k down on a $17k car - most of that went to taxes, DMV fees, doc fees, etc.  Most likely only about $1000 went to the car itself.  Of the $1500 you have made in payments,  you have likely only paid about $900-1000 tops on the car, the rest is interest.

So there is negative equity.

When you buy the new cars, that shortfall will be applied to the new loans.  So while you can do it, you will be putting yourself upside down on the two cars from the start.

Answer 2

Yes, this is possible.  Unfortunately, the $4500 you've paid so far on the new car probably isn't enough to get out of it.  You may need another $3k - $4k down unless you want to roll over the negative amount into the 2 used cars.  Most dealerships will do this for you but remember, you're going to be "upside down" in the 2 used cars and probably won't be able to re-sell them until they are fully paid off.  On top of the original selling price of the used cars, you'll finance, tax and license, interest, plus the negative amount from the new car.  Good luck!

Answer 3

that is stupid because if you trade a new car for two used ones the price is going down for both faster than for the new one, plus if you want to sell the new one it is much easier