I have a 2024 Honda crv, vin is 2HKRS4H47RH419687. It’s black and I have a rough estimate offer from carvana of 25k. I have a payoff figure of $30,862 ao today. Interest is 6 percent now, been paying for almost two years now. Amount financed was about 43k. Total sale price of $56,644. I know I’m an idiot. With a 7 year finance term. Any advice or tips? The monthly payments suck, about $700 each month, and I have around $1.3k left every month after all bills are paid for etc. maybe sell for a cheaper car, refinance loan, etc?
Expensive 2024 HONDA crv, mid finance, advice please!!!
byu/aescobar73 inpersonalfinance
Posted by aescobar73
4 Comments
Based on what I’ve seen, trading in your car for a cheaper one is usually a poor idea, especially if you have negative equity. You’d be getting a considerably worse car and still owing more than it’s worth.
1300 after all of your bills is pretty huge, but make sure that’s accurate and consistent month to month. Maybe toss an extra 400-600 a month at it and get it down quick, then keep the car as long as you can. It’s still pretty new and still under warranty, it should last you a long time.
EDIT: Just looked and you’re also trying to get a GTI? What are you doing…?
Refinance or get a second part time job. Throw all extra income at the loan. Refinance might be tough, 6% is already on the lower end for a now used vehicle but doesn’t hurt to try.
Is your $1.3k monthly surplus after savings/retirement? If so, you have extra money to throw at this now. Make sure any extra payments are made toward principal.
Selling at a loss would be last resort IMO.
6% is pretty good for a car loan these days. There are people getting worse rates on mortgages right now. Unlikely you’ll be able to refinance to a much better rate.
A 7 year term is a bit ridiculous and should have been a red flag that you were buying too much car.
Since you’re upside down, you can’t still it unless you can come up with the difference between what it’s worth and what you owe.
Just keep making payments and keep up on the maintenance.
Depends on your other debts, but if this is the only one, I’d start throwing additional money at it to pay it off in the next 2-3 years. Once you’ve done that, continue saving the amount that you were paying, and put it into a separate savings bucket, if your bank has that feature.
After you’ve driven this car into the ground, use the rule of 20/3/8 to buy your next car. 20% or more down, 3 year or less loan term, and a monthly payment that is less than 8% of your gross monthly income. That will inform you on how much car you can afford.