Never roll negative equity into new car

Dear Terry,
I have a 2007 Dodge Charger R/T. We are way upside down on the car and have a high payment. I want to know what options, if any, are available to get a cheaper payment.

The Blue Book value if it is in great condition is $23,000 and -- get ready for this one -- we owe $41,000 because we were also upside down on the previous two vehicles we purchased. All that has been added to this one and I would like to refinance it and try to get a cheaper payment. Is that even possible?
-- Shannon

Dear Shannon,
While I'm all for a free marketplace, there should be a law against rolling over negative equity into a new car purchase.

The subprime mortgage crisis was created in large part by extending mortgages with stupidly low initial interest rates to unqualified buyers. Car dealers and lenders have created a similar problem by allowing people to sign on for loans that are far larger than what the new cars were worth before depreciation set in.

I wish I could offer you some hope, but there's little likelihood that refinancing even for a year-longer term -- assuming you're not financed at 72 months now -- would significantly cut your payments. Hang in there, get this car paid off no matter what and never again roll over negative equity into a new loan.