Upside Down...Now What?

Denise says that she can't sell the car, but Dave says that she's much better off doing it herself, rather than turning it in.

QUESTION: Denise says she can’t sell her car.  Should she take it back to the dealership and let them sell it just so she can get out of the deal?

ANSWER: You’ve just been trying to sell the car for too much.  When you return the car to the dealership that is a voluntary re-possession and they will sell it at a wholesale auction. 

You’re going to make much more money selling it yourself than if the dealership sells it.  If you let them sell it, that will increase the amount of debt you owe to get out of the upside-down car deal.  You need to be in control of the sale of the car.  Even if you sell it for a very low cost, it’s still more than what they’d sell it for.

Then, just go and get a loan for a few thousand dollars that will cover the difference as well as the purchase of a $1,000 - $2,000 car.

Finally, never borrow on a car again.

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