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Ditto on everything Sean said - you are not alone in the US among those who live above their means and end up paying tons more for the same things that people who live within their means. I kow plenty of people in circumstance not unlike your own. I would never borrow money on terms with such ridiculous interest rates - I'd rather get a used car, paid in full, and have one less monthly expense dinging my income. $500/month to drive someone else's car (it's not really 'your' car until you have the title) is not how to get out of the hole you're in.
I hope you get out of the predicament you are in as quickly as possible - I think it is definitely time to cut your losses and abandon ship on that car. Kia's resale value is not a secret - these things can be researched before you buy your next car. If I were to get a new minivan, I would buy an Odyssey (Honda) or a Toyota Sienna - steer clear of the domestics because their resale value tanks.
Thanks for your input. I didn't have a choice with the interest rates after the bankruptcy. I was 26 when I bought the first car and drove my trade-in hooptie to the dealership literally smoking and vowed to not drive away in it.
When I got the van, it was just a must because of the kids. Now that they're older, I never have all of them in the van with me at one time. And my oldest daughter lives with their father now, but at the time, I really needed the space. I wanted an Odyssey, but that was not an option. The Kia was the only thing I could get.
I've found out that I really don't like minivans and won't be buying a new one when I'm in a position to buy a new car. Guess I should've thought of that before I had all those kids. LOL
I definitely will take your advice and do the research when I get that far.
I don't know the answer to your question. I do know that minivans are very expensive for bumper work, so it might have an effect on resale. Do you have many other claims against your insurance? If this is the first, it might not affect your rate that much if at all. Check with your agent.
No, I've only had one claim from 2002, I believe it was.
You did not say if you have made your payments on time but if you have and since the bankruptcy was 6 years ago, you should be able to refi the loan at less than 19%. You can always threaten your lender by saying you cannot afford the payments anymore and you might just have to walk away. They don't want that and might give you a lower rate.
Well I did try to re-fi it through my current lender as well. They haven't gotten back to me yet...I don't think it will be good. I refinanced with them once already in 2005. Haven't tried the threat technique though. Yes, I make the payments on time.
Get ready to drive to Texas and keep the Van until it is paid for.After it is paid for keep driving it until it costs more to fix it than it is worth.
In the meantime you can pay more each month to pay it off earlier.
Now you are paying $519 for the next 45 months.
If you pay $600 a month it will save you $1177 in interest and 8 months in payments.So only 37 more payments for you to make.
Now if you start paying $600 a month now until get your income tax refund and pay $5240 Tax Money on the Car that leaves you with a $8000 Balance.If you keep paying $600 a month for 15 more months after the income tax your nightmare will be paid for.
So $600 a month for the next 10 months,$ 5240 from your taxes and 15 more months of $600 for a total of 25 more payments.
How does that sound?And by the way your Bankruptcy Record should disappear from your credit report by then depending what state you are in.
Here is a link to the calculator I've used.Do your own checking in case I've made a mistake. Auto Loan Early Payoff - Financial Calculators from Dinkytown.net
I was thinking about the idea of selling the van and paying off the balance while driving a beater around for the next couple years. But I can't sell the van and still have the balance can I? I mean, if the loan is not paid off, they're not going to give me the title, so I can't transfer ownership to the buyer, right?
Thanks Marita. That plan does sound do-able as well. I'm not in a position to pay extra every month right now since everything is so expensive, especially my rent. Hopefully, when I get to TX, I will be though.
Do you have a family member that owns a home and can take out a lower interest home equity line of credit loan on their house to pay off your loan. Then you make payments to them every month?
Otherwise, in the future, until your credit rating is all better, don't buy a new car with a loan. Or just save up and buy a used car with cash. All new cars and used cars bought from a dealership depreciate greatly the day you purchase it. Then you are getting killed with high interest rates because of your credit rating. And with gas prices the way they are today, factor in trying to buy a more fuel efficient vehicle.
Also, when you buy a car, don't buy one with too many fancy features on it. They will all eventually break and be very expensive to fix. Manual transmission cars will last longer than ones with an automatic transmission. It's cheaper to replace a clutch than rebuild an automatic tranny. And the rebuilt trannies never feel the same as new.
I haven't had a car loan payment in over 10 years and it feels great! All my cars have been private party car purchases and the most expensive car was $2500. My current daily driver is a car that only cost me $500 four years ago. And it gets about 35 miles to the gallon when I am driving it (my boyfriend has a heavier foot).
I was thinking about the idea of selling the van and paying off the balance while driving a beater around for the next couple years. But I can't sell the van and still have the balance can I? I mean, if the loan is not paid off, they're not going to give me the title, so I can't transfer ownership to the buyer, right?
You'll have to sign a note for the balance remaining on the loan. Tell your finance company that you aren't going to keep going with this loan on this car, and they can either sign a note for the balance after you've sold the van or that you're going to do a voluntary repossession - and then you'll sign a note for the balance after they've sold it at auction. That might also inspire them to drop your interest rate, if that is something that you want to negotiate.
A voluntary repossession will be a ding on your credit report, but you'll have to decide whether the credit rating or the cash is more important.
I thought of going the voluntary repo route as well. I'm not sure paying the balance would help anything since it would be reported as a paid collections account. Although the unpaid balance would be nagging to me.
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