How to Get Out of an Upside-Down Car Loan…FAST!
I’ll admit that I’ve lost over $15,000 between 2 different car trade-ins, but it was because I wanted a new car, not because I had to get out of the loan. But if you find yourself in the position of owing more on the car than it’s worth, here are some tips to get rid of that car loan quickly.
1. Get a good estimate on your car is worth
There are a ton of sites out there that tell you what they think your car is worth, but you need to get an evaluation from many sources. I advise doing at least the following:
- Get the True Market Value (TMV) from Edmunds.com. Be honest with the condition of your car because very few cars will really sell for the “Excellent” price. Most cars are Good or Fair. Same goes for
- Kelly Blue Book (kbb.com). Keep in mind though, that these sites are often what vehicles are listing for, not always what they’re selling for. Look at the trade-in and private-party values and know you’ll probably have to settle somewhere in the middle (unless you have a hot car, which depends on the market).
Tips for donating your car to charity
Find the charity, don’t let them find you
As with many charities there is a lot of money spent on acquiring donations. In fact, some charities spend the majority of their funds on acquiring more donations – leaving a lot less for the actual charity recipients themselves. This is why some people choose not to give to charities that solicit donations.
With the car donations, it is even worse. There are many For-Profit companies that advertise as a means of donating your car to charity and they leave very little left for the charity. They typically leave the charity 50% to as little as 10% of the value of the car – and keep the rest as their revenue.
The better way to find a place to donate your car
Since the charity car donation thing has gained so much interest, quite a few charities now have this as an option – even though you may never see them advertise it. So, next time I donate a car, I am going to call charities that I am already familiar with and trust and ask them if they accept car donations. Not every charity will accept them, but you might be surprised how many do.
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