Originally Posted by HikeMama
Regarding the car- I guess that scares me. We got it for about $12,000. We had $5,000 to put down on it so we started with a $7,000 loan. I think we owe about $6,000 on it right now. I could sell it for about $8k tops? I don't know how many people buy from a private seller for $8k though. Anyway, I don't know if I could feel comfortable taking the risk and getting a car that's worth less that I might have to fix for a lot of money. We have a warranty on the big stuff for a couple more years on this one and for the year, it has low miles so it probably has a lot of life left in it. It uses gas like crazy though (less than 16 mpg) so I'm trying to consider my options. I'm just not too car savvy so I'm afraid to make another big mistake and be out of a car completely. I'm also not sure we/my husband especially feel desperate enough- but of course, that could be a big mistake too. oi.
Oh, man. With 5k, you probably could have gotten a pretty reliable used car, no loan necessary, probbly even with a used car warranty if you bought from a dealer. If the car is really worth $8k, you could totally sell it to a private buyer for that. If you can't sell it private sale for that much, then it's not really worth that much.
You only owe $6k on it though? Could you try to sock away another $2k to $3k? Then, if you can't get $8k, at least maybe get the $6k, so you are out of that debt, then just go buy something outright?
I think an important thing with used cars is to get to know a good and inexpensive mechanic. And usually that's not the folks who run auto repair businesses. It's usually the buddy at work who tinkers with cars on the side. In my case, it's my dad but my dad OFTEN does work for guys he works with or friends of my mom or whatever. And he does charge them, but substantially less than they would pay going to a shop. That's not to say that used cars or automatically money pits...I have a $2300 15 year old van in my driveway that we have had for a year and hasn't needed a single repair yet-not even a tire replaced. But also, when buying a used car, especially private sale, you want your trusted mechanic to look it over to see if any big repairs on on the horizon.
So perhaps, make it a goal to get rid of the car, but not necessarily right away...take some time to locate a good mechanic, hold some garage sales or something this summer to get some money together. If you could get like $3k together, and you can sell it for $8k but you only owe $6k, then you would end up with your original $5k to go buy something outright with. Honestly, between having the loan on it, and it only getting 16mpg, I don't know that keeping it is a good idea, especially with gas predicted to be $4 a gallon this summer.