[fosterj]

Thanks for the replies.
As for the bank fees.. we kept opening accounts whenever one bank would give us a loan, or credit card over another bank... in the end all the banks here, except 1, have monthly fees on their accounts.

Here's the problem with our car situation:

Back in 2002..we bought a 1998 Sunfire (purchased with a loan for $15000).. the car payments were $300/month. But the repairs would run us close to $500 month.. (or two months would go by and then a $1000 problem would occur). Just to keep the thing on the road we were going broke fast, plus you were always worried about what would happen next.

In 2005 we traded the 98' sunfire for a 2005 Mazda3 (four door as we were expecting our first child at the time).. We consolidated 1 credit card and the remaining $5K of the sunfire loan with the new car loan.

We walked out of the dealership the summer of 2005 with a a brand new car and a $40K loan. ($295/biweekly)

While this seemed good at the time (fixed car cost..no surprises) we didn't plan well enough for the near future. 7 months later my wife was on maternity leave and money got extremely tight.. this lead to maxing out all the credit cards just to keep on top of the monthly bills and the expenses of a new baby.

Currently we owe a remaining $27K on that consolidated car loan. To sell the Mazda3 right now would net about $17K (that's what they are going for locally in the paper)...that still leaves us with a $10K loan and no car....not a position we can be in as the wife uses the car in her daily job.

I would love to sell the car (although I would recommended Mazda3 to anyone that wants a great reliable and fun to drive car, no complaints) and get the savings there... but I can not go back to the situation we were in before of the surprise repair bills every few months.

I take the bus while my wife needs the car for her day job..she uses it during her daily work routine, so we need to have some sort of car.

I'm leaning towards..just the account consolidation and save as much as possible while paying off the credit cards for another 6-12 months.

But it's hard to do when you know the bank has already said..yes here you can have a house right now, just find a way to get the down payment.

edit-----
on a side note: When I went to drive the sunfire to the dealership for the final deal.. the rear-end brakes let go..with a loud bang and the service car light came on... I drove it to mazda parked it handed the keys over and drove the new car away... This was after the week before when we were on vacation with the sunfire..and the water pump broke in a French community on a long weekend....(we don't speak a lic of french)... in the end that was almost a $2000 repair job after driving 5 hours to get home by filling it with water every 30mins...

fun times...