Getting Two For One
The van loan is crushing Marsha's family, so Dave gives advice on getting two smaller cars and ditching the van.
QUESTION: Marsha has a van that she loves, but the $16,000 loan they have on it is crushing them. They pay $380 on it, and her husband makes $33,000 a year. Kelley Blue Book says it’s worth $13,500. They want to get two smaller cars, but they’ll still have to get loans to make that happen. Should they do that?
ANSWER: Yes you should. Sell the van and finance the $3,500 that you’re in the hole, along with $2,000 for the other cars. You’ll owe $6,000 on two cars instead of $16,000 on one. Don’t trade it in because you’ll get trade-in value. Shine it up and retail sell it to someone.