Is it a smart Idea to return a car but still owe a car loan on it?
Asked by Loisannedora Apr 11, 2020 at 05:20 PM about the Mercedes-Benz 300-Class
Question type: Car Selling & Trading In
My mom thinks I can't pay off my car
even though I can but everytime we
talk about the car I purchased she
wants me to either return it or trade it
in, so is it a good idea to return or
trade in a car that I still owe money
on?
4 Answers
Depends on whether you can afford to and remember, if it is financed, you don't own the car until the loan is paid off.
Go on KBB to get the trade in value and compare to what you owe. That will give you an idea if you can afford another vehicle. Will your Mom be helping make a down payment on a newer one?
Trading it in will lose you a lot of money. If you can pay it off you will save interest on the loan. If you give it back to the dealer you will still owe all that money!
Unless the vehicle is falling apart and costing you lots of money for repairs, keep it!! Especially if you just recently bought it!! If you are one of the many people who are temporally out of work because of the coronavirus pandemic, hang in there!! The bank or finance company will work with you!! This is a nationwide disaster that you have no control over! The bad part about trading in a vehicle when it's not paid off is the amount you still owe gets added to the new loan. Then your monthly payments will be more than what you're already paying plus you'll be paying for two vehicles, one of which you no longer have!! Hope that helps! Jim
