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Discussion Starter · #1 ·
Hey everyone, I'm seriously considering trading in my 13' SXT Plus for a 2015 or 2016 R/T Scat Pack with the Shaker hood, but the car isn't paid off yet. Its very possible for me to pay off the car next year, but I put a 10k down payment on the car that I don't want to lose. I have 18k left on the car and 6 years. I just need a little advice because I never trade in my cars. They're normally passed to my pops and the car will take a hit selling wise because of my mods.

So should I pay off the car and then trade?

I'm also considering supercharging the SXT, but I fear that I'll always have a slight amount of "HEMI envy" and that's a hard pill to swallow. I have a few mods like K&N cai, Solo exhaust, sequential tails, functional scoops...so nothing permanent yet! Any advice is good advice. Thanks

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How would you lose the 10K down payment? If it's paid off then all the value would be deducted from the cost of the next car.
 

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If you trade the car and still have a loan outstanding, the dealer will have to pay off the loan so that the lien will be released from the lender and that will figure into the trade amount( ie is the car worth more than the principal balance of the loan at the time you trade). What is the interest rate on your loan and how much do you expect to owe when you trade.
 

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I'd lose the 10k if I trade up before paying off right?

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You owe $18k on your sxt. The dealer will make you an offer on your car, it will be above or below 18k, I imagine below $18k in your instance?

If they offer below your payoff amount the difference is added to the cost of your new car, therefore the car becomes more expensive as they've just paid off your old loan.

If they offer you more than your payoff then the difference is used as a downpayment and taken off the cost of the new car.



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I generally find it to be a poor fiscal decision to trade in a car if you're upside down on current loan to value.
 

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According to Kelly Blue Book www.kbb.com, your '13 SXT Plus is worth about $19,500 as a dealer trade (I assumed good condition, 20,000 miles, standard options). Dealers frequently offer less than what you see on KBB - so maybe figure $18,500 or so is what the dealer will offer you as a trade. If you owe $18,000, then you should come out OK.

As an aside, I notice your posting says you still have 6 years on your SXT loan. So you had a 7-year loan? On 6-year or 7-year loans, typically you pay almost all interest for the first 2 years or so. Sure, your monthly payments are lower than on a 4-year or 5-year loan, but you haven't built up much equity in the car yet. Using the information you have provided, your SXT appears to have been priced about $29,000 or so, you put $10,000 down, and after a year or more you have paid the loan down about $1,000 or so. Not a great scenario. I bring all of this up because your posting also says you expect you can pay off the SXT next year. I'm confused given that you apparently took out a 7-year loan but have money available to pay off $18,000? People most often take out 7-year loans when they don't have much money, not when they have money sitting around.

Of course I could be misinterpreting.
 

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Discussion Starter · #9 · (Edited)
What is the interest rate on your loan and how much do you expect to owe when you trade.
The amount the dealer and I agreed on was $30,000.19. I put down 10k. Added the extended warranty for 1k. I have a 1.9% over 75 months I think.

EDIT: The car is basically mint condition. Only 4000 miles. I still have the old exhaust and factory intake. I can put the car back to stock if needed

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Discussion Starter · #10 ·
As an aside, I notice your posting says you still have 6 years on your SXT loan. So you had a 7-year loan? On 6-year or 7-year loans, typically you pay almost all interest for the first 2 years or so. Sure, your monthly payments are lower than on a 4-year or 5-year loan, but you haven't built up much equity in the car yet. Using the information you have provided, your SXT appears to have been priced about $29,000 or so, you put $10,000 down, and after a year or more you have paid the loan down about $1,000 or so. Not a great scenario. I bring all of this up because your posting also says you expect you can pay off the SXT next year. I'm confused given that you apparently took out a 7-year loan but have money available to pay off $18,000? People most often take out 7-year loans when they don't have much money, not when they have money sitting around.

Of course I could be misinterpreting.
I bought the car in August last year. So I should have almost exactly 6 years left. I put down 10k, but I could've paid for the car in full.

I bought a house two years before the car so I didn't want to deplete my safety net to pay off the car. That's why I took out a 7 year loan. To buy me some time...just in case something went wrong. In addition, the house needs some repairs, but I'll be done with those repairs later this year.

Not sure if that was the best plan, but its working out in my favor so far.


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I bought the car in August last year. So I should have almost exactly 6 years left. I put down 10k, but I could've paid for the car in full.

I bought a house two years before the car so I didn't want to deplete my safety net to pay off the car. That's why I took out a 7 year loan. To buy me some time...just in case something went wrong. In addition, the house needs some repairs, but I'll be done with those repairs later this year.

Not sure if that was the best plan, but its working out in my favor so far.


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Assuming you purchased the car with a low interest rate, it was not a bad plan at all.

I made a similar move recently when I bought my 14 Blacktop. I still have my money working for me in the market while I am paying for the car on a super low rate.

IMO, I would slow things down a bit. It appears as though you want to make a financially sound decision. Perhaps you should pay your current car off, continue to save some cash, sell your car on the private market, and then find yourself in a 2015. It might be a little further into the model year, which would help save you a bit more cash. Just my opinion.
 

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Given the numbers being quoted, if you trade in now, you will have little to no trade-in value because of the pay-off of your current loan, and they would have your 2013 which you just paid $10K to drive for a year.

To be candid, in that scenario, the salesman is most likely not going to be so willing to give you a good deal on your new car either, they will see you as such an anxious and willing buyer, they will feel they won't have too.

edited to add,
If your plan was sound at the start, then having the patience to stick to it may be the best solution.
Who knows how cool Challengers will be in a couple more years. :)
 

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Discussion Starter · #13 ·
Here's my KBB with everything on my car

Worth $24k and bought it for $30k. Msrp was around $36k I think


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First off, I would never trade the car over selling it out right. I've layed out three examples for you below.

Here's the first scenario:

KBB trade in for your car with no options selected falls in between $19,843 and $21,020.

Kelley Blue Book

A dealer will more than likely try to BS you and offer you the payoff, so basically, you're putting nothing down on your new car, and just walking away from this debt.

Here's the second scenario:

Take it to CarMax, and they'll more than likely offer you the low end of the trade in, ($19,843), they'll pay off your loan and give you a check for the difference of $1,843 which you can apply towards a new down payment.

Here's the third scenario:

That car in excellent condition to a private seller is valued at $21,674. Put it on Craigslist or EBAY and sell it outright, even at $21,000 you'll pay off your current loan and have $3,000 left over as a down payment.

Kelley Blue Book

One more thing, don't be in a hurry to sell it. If you plug 2011 in the KBB, it's still worth $21,000 with only 4,000 miles. These cars don't really depreciate much beyond the initial hit.
 

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First off, I would never trade the car over selling it out right. I've layed out three examples for you below.

Here's the first scenario:

KBB trade in for your car with no options selected falls in between $19,843 and $21,020.

Kelley Blue Book

A dealer will more than likely try to BS you and offer you the payoff, so basically, you're putting nothing down on your new car, and just walking away from this debt.

Here's the second scenario:

Take it to CarMax, and they'll more than likely offer you the low end of the trade in, ($19,843), they'll pay off your loan and give you a check for the difference of $1,843 which you can apply towards a new down payment.

Here's the third scenario:

That car in excellent condition to a private seller is valued at $21,674. Put it on Craigslist or EBAY and sell it outright, even at $21,000 you'll pay off your current loan and have $3,000 left over as a down payment.

Kelley Blue Book

One more thing, don't be in a hurry to sell it. If you plug 2011 in the KBB, it's still worth $21,000 with only 4,000 miles. These cars don't really depreciate much beyond the initial hit.
One thing to consider is that you do miss out on the tax incentive by not trading the car in and selling it privately instead. That is to say that you don't get to subtract the trade-in value from the price of the new car and only pay taxes on the difference. Depending on the trade-in and new car price, this could make the trade-in vs. private sale a wash. Of course this is only for certain states that have this credit.
 

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One thing to consider is that you do miss out on the tax incentive by not trading the car in and selling it privately instead. That is to say that you don't get to subtract the trade-in value from the price of the new car and only pay taxes on the difference. Depending on the trade-in and new car price, this could make the trade-in vs. private sale a wash. Of course this is only for certain states that have this credit.
Do you know how that works if you buy a car out of State? My State has the Sales Tax credit and I have done it when buying locally.

If I buy a new one in another State and my current one is traded in to the selling Dealer, would I pay only the sales tax for the difference when I go to DMV in my State to register it?
 

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1.9% is a good rate. I would recommend selling the car outright to a private party. You have too many variables to consider and the dealer will take advantage of the situation.
 

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I'd say if you CAN pay it off in the next year without discomfort, do so. THEN you can walk into the dealers with essentially a $19,000 downpayment in your pocket, AND the initial rush to buy the new 2015s will have died down.

Early adopters tend to get reamed, both on the price and by being uncompensated Beta Testers. Then again, I waited until Challengers had been out for almost 6 years before I bought mine, so you can see that's how I tend to see things.
 

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Step back and take a breath. Slow down , not so fast. I have bought many new vehicles over the years and most were done on impluse. I have a 2013 SRT CORE that i ordered new. I would love to get a HELLCAT , but then i ask myself why. The answer is the same as always "Because i want it". I will be retired within a year have need to stop thinking i need the latest and best. Stay with and enjoy a little what i have before moving on to somethintg new. Believe me when i say "There is something better coming". I'm not saying put your dreams on hold , just stop and smell the roses.
 

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I'd lose the 10k if I trade up before paying off right?

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I think I get what you're saying. But keep in mind:

The car is worth what it's worth no matter what you owe.

If it is trade valued for 20k and you owe 0 you can apply 20k.
If you owe 5k you could pay 5 to your bank and take all 20 and apply it on trade or take 20 apply 5 to bank (dealer sends them the $) and 15 to trade. Either way bank gets remaining $ owed and you apply to your trade

Anything you owe lessens what you can apply but will not change the value. The only reason to pay it off is to physically have the title in hand. It is one less thing for the dealers paperwork processors to screw up.
But it isn't necessary at all.


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