We have to buy a new (or used) car. The five of us barely fit in Jon's 12 year old Subaru wagon or my 5 year old Jetta. There's no way we're cramming another person, no matter how small, into one of our current cars.We have to get a new one before the baby is born.

I still have a car payment for my car, which I bought two and a half years ago. I paid too much for it, and then dinged it up, and am now "upside down" on it. So not only do we have to navigate the complexities of figuring out what kind of car to get, and whether we should buy new or used, and applying for and getting a loan, we are going to also have to figure out a way to get this Jetta traded in on the new vehicle.

I have never had to do this before (trade a car in when I owe more than it's worth), and I am very anxious about figuring out how to do it. I have a feeling the only way we will get it traded is if we buy a new car, but of course, you are always told to avoid buying a new car because they lose so much value as soon as you drive off the lot.

And the number of minivans now available is dizzying. How to decide which one to get? Sigh. Right now I am researching the Kia Sedona, which seems to be really cheap for a new car, have very high safety and buyer ratings, and comes with a kickass warranty.

Anybody got any thoughts on any of this? It all makes me feel as if my head might explode.

New or used?
Credit union/bank loan or dealer financing?
What kind of car to buy?
Which dealer is least likely to make me want to strangle the smarmy salesperson?


mamalife said...

Saturn is least likely to make you want to strangle your salesperson. They rock in this department. Unfortunately, I feel like their quality has goen down-hill in the past few years. For this reason, the last 2 cars we have purchased have been Hondas. I feel like paying more up-front is worth it if the car lasts longer and spends less time in the shop for repairs. My advice: pay for the Consumer Reports guide on-line. It is about $12 per car and well worth it as it tells you what the dealer pays, what money they get back from the manufacturer (I think it is called "hold back" or something like that)... let the dealer know you know this information. Pit dealer against dealer and let them know you are also looking elsewhere and will go with whoever offers the best deal. Let them know you are also looking at other manufacturers (even if you really aren't) ... in other words, play as dirty as they do!

Clisby said...

I agree about Saturn dealers. (I have no idea about current quality - our Saturn is 12 years old). Next is Carmax, if you have one of those around. They're like Saturn in that they don't negotiate price - just take it or leave it.

I'm 53 and have bought one new car (and had one car loan) in my life, so I'd always advise buying used. As far as type of car goes, I'm really happy with my Ford Taurus wagon, which has 3 seats and can seat 7 people (although the 3rd seat is rated for only 160 or 180 pounds, I forget which - so you only get 7 if a couple of kids are back there.) You'd have to buy a Taurus used - Ford stopped making them.

britney said...

Don't finance with the dealer - finance with your own bank.

Avoiding the dealership altogether is ideal - it takes longer (to get rid of the old car and find what you want to buy) but you save money in the end if you can sell your old car to a private party and buy from a private party.

If you do want to buy new, you'll still make more money selling your old car privately - the dealer won't give you much no matter what.

DEFINITELY don't mention you have a trade-in until the very end of the price negotiations..otherwise they jack up the price of the new car while pretending to give you a good tradein price on the old.

The trade-off is time/effort vs. money - the less effort (going to a dealer) means you spend more, the more effort (buying/selling privately) means more of an effort/time on your part.

britney said...

BTW, you may actually be able to sell the Jetta privately for what you owe on it, even if it's more than its worth (depending on how much)..not everyone researches carefully before they buy cars and may be willing to pay more for something they want.

Anonymous said...

Buy a good used Honda from a reputable dealer. If you can sell your car privately, do it first, even if you have to eat some loss. If you do take it to a dealer to trade, be sure your gas tank is full. A dealer once told me that indicates you're not desperate - an empty tank means you're planning to do business then and there and they've gotcha. A used car from a good dealer will come with a warrenty. Not only will you not eat the new car depreciation, but insurance will be less too.

Ms. Booty Homemaker said...

Oh! I so agree with the used Ford Taurus wagon. Safe. Roomy. Great to drive. Reliable. Nice looking. Good on gas. I LOVE mine; bought it in December and thus far, it's my favorite car ever. Why Ford quit making them I'll never understand-- since having bought mine, I see them all over the place and have learned that at least three of the mamas I see around town at various regular outings also drive Taurus wagons.

dewi said...

Do not trade it in.
Give it to Henry (he will be driving very soon anyway and needs a car) a good incentive for better grades ;-) and he could help you with driving E and J to and from school.

If his father was planning to contribute to the car fund for his son, you can use his contribution to pay off half of the loan and you pay the other half.

helen said...

When we bought a car from the dealer (used truck actually) the difference in financing was 18.5% from the dealer vs. 5.2% from our credit union! On a 12K loan I think we only had a $160 month payment (could always pay more but with new baby this could be helpful).

CarMax rocks. Lots of benefits to new, though, as there is always the warranty issues. Also, the CarTalk guys have good reviews of mini-vans on their website.

kayla said...

We financed our last two cars w/the dealer - at the time each dealer was offering much better rates than either our bank or our credit union. Do your homework before you write off the dealer.

I second the Consumer Reports suggestion also. When researching our last car, I was interested in the Saturn Vue, which was also offering a tempting 0% apr. IIRC, it had excellent safety ratings but terrible reliability ratings. So we opted for a Honda CRV instead which has been an excellent car. (If my husband had been agreeable, though, I'd have gotten a minivan - I constantly find myself wishing I could carry more people!)

Clisby said...

One other thing - I've bought 2 cars (including my Taurus) from individual sellers, and both were good cards.

If you consider that:

a) Research the price (, Aim to pay somewhere between the typical trade-in value and the typical retail value.

b) Pull a Carfax report on the car

c) If you really like a used car and want to buy it, your last step should be to have a mechanic check it out thoroughly first. (I've done this when buying from a dealership also.) Obviously, this is no guarantee, but a good mechanic can spot potential trouble spots a lot better than I can.

Anonymous said...

Don't forget that some used cars on the market were in Katrina.

Clisby said...

"Don't forget that some used cars on the market were in Katrina."

One of the reasons to pull the Carfax report.

katie allison granju said...

My wheeler dealer superlawyer of a little brother, who makes deals as a hobby, has decided to take pity on me and handle figuring this all out and dealing with the car buying process for me. He's gonna talk to teh salesmen, negotiate a price for me - everything.

I luuuuurves my baby bro ;-)

Anonymous said...

Ford Freestyle wagon is the replacement for the Taurus - much nicer, third row seat, sits up very nice. All advice about dealers, etc., is accurate - except that for financing a new car, often the American makers offer super-low financing deals (0.9%, 1.9%, etc.). That makes a dent in your payments.

Naomi said...

I almost bought a Kia Sedona minivan last fall. After test-driving several options, though, I wound up buying the Toyota Sienna. We bought new, because I really, really, really wanted a couple of features that had just become standard: (1) side-curtain airbags; (2) the electronic stability system (standard on all Kias, optional but available if buying new on the Toyotas); (3) the middle windows that roll down.

I still think the Kia Sedona is a fine choice, but I have knee trouble that's aggravated by sitting, and I found the Sienna more comfortable.

I really love our Sienna. I would absolutely buy it again.

Naomi said...

Also, it's really hard to find used cars with some of the newer safety features, like side-curtain airbags and electronic stability control. These have been available as options for years, but until they were made standard, hardly anyone got them. So, if by any chance you paid extra for high-end safety features when you bought your Jetta, definitely try selling privately, because there are always people looking for used vehicles with the safety-related bells and whistles, and they are damn hard to find. This is part of why I bought new: I really wanted the side-curtain airbags.

Anonymous said...

Get one of those "blank check" loans from a bank or credit union before you go. That way it's like you are dealing with cash. You can apply for a loan online at capital one.

Are you sure you want to get rid of your car and keep the subaru. Subarus are good cars, but a 12 year old car is itching for a major repair.

Anonymous said...

One word: Honda. You'll pay more upfront, but it will still be reliable enough to drive across country for a long, long time. Hondas also hold their resale value so well that it doesn't really make much difference if you buy new or slightly used.

Like others said, get a bank loan, pre-approved, so you can walk in there and deal in "cash." If buying new, then do your research, find out the dealer invoice price fo the vehicle, and make an offer based on that. Of course they won't take it at first, but just sit there and tell them that is what you are prepared to pay, and no more. Be prepared to get up and leave, saying that you are going to go shop around.

Anonymous said...

Another suggestion. Since you owe more than the Jetta is worth, why not keep it, pass it to Jon as his daily driver, and trade in his car? That way, you'll have two reliable newish cars, and you won't have a salesman trying to give you the run around about the amount you owe on your car, or the dents and dings that it has. Sure, you won't get as much for Jon's car, but the difference might not be so much in the end, taking into account the financial situation surrounding the Jetta, and what the body condition will knock off the trade-in value.

Anonymous said...

I agree about Saturn salespeople being good, but their quality going down.

I am now sold on Hondas. I love mine--runs like a top, and several friends drive used Hondas that have done them well.

Laura said...

I have been researching a minivan for purchase next year, and I was very intrigued by the Sedona. Then, I realized that when I added all the features I wanted, I might as well buy the Toyota Sienna -- because I've been so pleased with my current Toyota [RAV 4] and its incredible reliability.

However, if you are looking for entry-level minivan, I think the Sedona is a great choice. I wish I could talk myself into it. :)

Laura said...

we have the new kia sedona and love it. as far as haggling, honestly the last two kias we have bought were easy-peasy when dealing with sales people. they gave us a sweet trade-in for our full sized gas guzzling van which really shocked me and pretty much clinched the deal for my man. he didn't have to haggle at all and i do believe that he was disappointed. LOL
good luck.

patty c said...

HYUNDAI all the way baby. i have had two and will buy another. and they have a couple 'smaller' SUVs now. great warranty, inexpensive and the best thing - great quality. my hyundai is comparable to honda accord and toyota camry...but cost 11K less.