I’ve been lurking this site for quite a while & am glad to finally be able to be a member & hopefully gain constructive feedback. Here’s my situation. My first & current vehicle is a purchase with a cosigner (bought cpo altima 65k mi) I’m underwater $8000 due to having someone rear end me causing an accident report & the car is approaching 100k mi. I understand this isn’t the ideal situation but I find it as a great way of getting a new car while paying off the balance on the altima, love the flexibility of leasing vs traditional financing & not having to worry about a service bill at inconvenient times.
$8000 negative equity
$270 current note
Would be comfortable @ $400-$600
Limited Credit w Stellar Cosigner
12k mi @ 36 mo
Preferably a luxury brand but pretty open as far as make.
Current vehicle has no unrepaired cosmetic nor mechanical issues.
I don’t have much credit history, just 2 CC’s & this open auto. Everything is in good standing, good payment history.
What would you say be my best route on leasing?
Input would be greatly appreciated, thank you.
Your negative equity alone is at least $225/month, which only leaves you with $175-$225 for the new vehicle. I’m pretty sure you aren’t getting any luxury car. You might not even be able to get approved for any lease since the negative equity would be 50% or more of the entire monthly payment.
Thanks for the reply, I too thought of buying a second vehicle but after looking at maintenance cost, insurance & gas, it just makes more sense to channel my funds into one vehicle. The vehicle was repaired & has full coverage. It was a fender bender but shows on the carfax thus hindering it’s resale value, that & it’s mileage. 100k mi on a 13’. I wouldn’t necessarily say my credit is bad, just not well established. I do have this open auto with good payment history, so there’s that.
Thanks for your input, Jon. Based off that, a more realistic lease will be somewhere around $400-$500 before my negative equity correct? I was taking this into account as well which is why I thought a luxury make would be a good candidate because of their LTV vs my negative equity. But I’m fairly open to different makes, just not Nissan lol.
What kind of credit score have you got now? If it’s over 700-ish and you have a solid income you could try and lease a vehicle that has a low interest rate at the moment and actually reduce the interest rate that you currently have.
For the negative equity amount, where did you get the vehicle quote from? Did you check vroom, carvana, etc for quotes? You might be able to get a little more money out of the Altima. Selling privately will probably get you more as well.
If the Altima is running fine I would try and refinance the loan to a lower interest rate and keep the vehicle for another couple of years. That would be the most frugal path in your situation, but that’s easy for me to say.
This. I don’t get it. So it’s a 2013 Altima bought at 65k miles. A 60mo loan at $270/mo is a vehicle sales price of ~$15k at 5%. But OP has been paying on that loan for a couple of years - there is absolutely no way that the vehicle depreciated by ~$10,000+ in 35,000 miles unless it was driven into a bridge abutment and not repaired.
Also, in my experience, I’ve been able to sell used vehicles private party without any negative affect from prior accidents as long as they were fixed well from a reputable shop with a warranty. I understand that it’s probably not the same for dealer trade-ins, but we’re talking about a minor fender bender. I’d buy 20-30% for a salvage/rebuild title but not for a fender bender.
Regardless, the solution is not to double down on that mistake and finance the negative equity AGAIN into yet another car loan or lease. If you’d even get approved to roll that much in, which is highly unlikely.
OP - what is current payoff and Carvana/Vroom quote for your Altima? Is this a 2.5S or a 3.5SL or what?
Based on my memory, it will be hard for you to be approved by any financial company (lender) if your neg equity is more than 20% of your total payment when financing a car. I don’t know this math is the same as leasing. Anyhow, it is not a good idea to roll such a huge neg. equity into a lease. Will your current vehicle really cost you more than 8000 to maintain in the next 3 years? If not, just drive it for another 3 years and get into a new car with a much cleaner hand.
Thanks for your input. The damage is showing up as moderate damage. I did have it appraised at a dealership a few months back but to be fair, it wasn’t a Nissan dealership nor Carmax. Current payoff is $11,000. I’ve been paying on it for 4 months shy of 3 years. Original amount financed was around 16k if memory serves me right.
I’m not looking into getting out of the vehicle solely due to costs, although it does play a factor. I personally am not in love with the vehicle. I’m in a substantial better income position than I was when I purchased this vehicle. Not only that but the idea of continuing paying towards such depreciation gives me the chills. I rather cut my losses now & pay the remaining balance with a lease that’ll not only give me a piece of mind but also an exit from being married with depreciation.
You should take advantage of your better income situation and make larger payments on your Altima. Make principal payments for 300 to 400 dollars a month for the next year and you’ll be out of the car sooner and in a better financial spot.
Best advice here is to simply pay off the existing loan as much as you can, any way you can to eat up that negative equity. It’s easier because the car runs…
It just sounds like to me that OP is going to make an absolute terrible Financial decision because the Altima doesn’t tickle their fancy. I get it, I’ve been down this path before myself and I’ve been paying for my financial decisions for a decade now.
Don’t be like me. Be smart. Pay off what you owe if the car runs and in a year or two years you can get into something nice. Mind over matter.