Advice regarding my vehicle financing....

[sageadvice]

Greetings,

Thank you so much for taking the time to respond to my posting, I greatly appreciate it.

I currently drive an '05 Ford Escape, which I got two years ago. I purchased the car for $26,000 from CarMax. I was able to put $4,000 down and had to finance the rest through CarMax Auto Finance. My current payments are $370/month. I am now regretting getting rid of my old car (which ran fine) and was completely paid off. Now that money is not coming in as much, 370/month is getting steep. Ideally, I'd like to get rid of the car and the payments and purchase another used car straight up and pay all up front so that I have no payments. I am looking for cars for sale in the 5,000 range right now.

My question is, how do I get out of my current situation? How do I get rid of the Ford Escape if I still owe thousands on it? Is my only option to find someone who is willing to pay what I owe on it and buy it off me or take over my payments? Ideally, I'd like to make a bit off my current car, so that I could buy a much cheaper one that I wouldn't have to make payments on.

I would really appreciate any light you can shed on my situation. Thanks so much and happy new year!

[disneysteve]

How much do you owe?
How much is the car worth on the private market?

If you owe more than the car is worth, do you have enough in savings to pay the difference?

If not, you could take out a new loan to buy another car and pay off the remaining debt. If you are upside down by $2,000 and buy a $5,000 car, that would mean a loan of $7,000 which would give you much lower payments than you have now on a $22,000 loan.