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 Dear
Terry,
About 10 months ago I purchased a used SRT Neon for about
$20,000 after fees. I now owe about $14,000 on it.
I plan to buy a condo that is right up the street
from where I work, so I don't have far to drive. The insurance cost on these cars
is outrageous and I could use the money to buy the condo. Trade-in value for the
car is about $11,000 to $12,000. I was thinking about trading my car in for a
beater worth a couple of grand so I can pay off the balance of the loan. Is that
possible or do dealers turn down trade-ins like this?
-- Bob
 Dear
Bob,
You don't mention the model year of your SRT Neon,
but if the trade-in value is as high as $12,000
you should be able to sell it privately for at
least $14,000 to cover your loan. What you want
to avoid is going to a dealer and trying to work
some sort of deal where the dealer pays off your
car and puts you into something cheaper.
The dealer is going to want to
roll over the $2,000 difference in what you owe
on the Neon and the trade-in value into the "beater''
you want to buy. In the end, you'll wind up owing
far more on that beater than what it's worth.
Sell the Neon privately and look for some basic
transportation you can buy for cash. That will
make buying that condo easier.
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