Wow. I have a girl (friend) who is trying to get her finances in order and I have been helping her. She had about 9k in credit card debt between 5 cards all around 17% interest. We got them consolidated, closed them all and now she makes 1 payment at 8.5% interest, much better. But here is the kicker and don't ask me how she got into this bind, but she had negative equity on a car she traded in. She has a car, and the blue book retail value on it is $21,500 and she owes $38,500 !!!!! Her auto loan is around 9% interest over 6 years and she has had the car for 15 months, the payment is $740 per month. Crazy, I know. Unbelievable. Anyways so she has made some mistakes with money in past and wants to get on top of things, her credit isn't that great 590 ish score. What in the world would you guys do about this car situation? That is what is killing her more than anything. She can't sell it, can't trade it in, can't refinance it, and has no money in savings to put towards it, she just makes that $740 payment every month and then after her rent and credit card payments, struggles to eat. Her salary is around 75k, not bad, but not that great either.
Lord, what kind of car does she drive? That's higher than my mortgage payment! And how does she owe more than the car is worth if she makes her payment every month? Is that possible??
Wait she makes 75K a year? That's maybe 4K+ a month after taxes she's bringing home... that should be plenty enough for her to survive on.
Say what? Where does she live that 75k is a "not that great" salary? Hollywood? It amazes me how much money some people think they "need", and it also amazes me how someone who could be dumb enough to get into that much debt could still be intelligent enough to nab a job making 75k.
she makes 75k a year? gees, i make a bit above 50k a year. my hybrid suv cost almost 38k after tax and such. yet i still have more than enough to save up. ok, i live with my parents still, but i buy like tons of guitars. anyways, if she makes 75k, i can't see how that's not enough.
Have her quit going shopping at the Louis Vuitton store every day and she'll be fine. There's GOT to be something you're forgetting.
75k in houston is a lot. Its more than what most people paid. She should sell he car get a 10000 dollar car and just write off the other 12000.
I'm in almost the same boat. While it's not as bad a car payment, it's pretty bad. I'm just going to start doubling up on payments once I get completely out of credit card debt (3/15!!!!!!!).
I understand that, but how does that happen when the payment is $740/month and it's only been 15 months? Unless she skipped a bunch of payments and the fees shot up, I don't know... I just don't see how it's possible to owe $38,500 on a car worth $21,500 after only 15 months with a payment as high as $740/month. Am I missing something? I'm starting to think FFB hacked into Desert_Rocket's account.
That attitude alone explains a lot. I want to say that it surprised me that someone who can earn 75k would be this...how can I put it...unsmart about their finances. But in this day and age I think bad money management is as common as obesity.
How the heck can she barely afford to live on 75k a year??? Time for her to make some major lifestyle changes. MAJOR. Have her pour all of her money into that note to get it paid off early. I'm sure that the 38,500 is if she just pays MINIMUM payments. Have her move into an efficency apartment. Have her shop at Wal-Mart and buy generic food. With 75k a year, she COULD be out of the hole in a year. And of course, don't marry her. But do let her buy you extravagant gifts. Or cocaine. She obviously does one or both to excess behind your back.
I don't know what I find more sad... 75k is not that great $740/mth car payment struggles to eat I have some advice. Go volunteer at a homeless shelter.
No kidding. It's kind of hard to take this seriously. This thread sounds just like: Back in college I had a roommate who was supported by her mom. It was just her and her mom. Her mom made 6 figures but couldn't "afford" to put her own child through school. But my dad (the chief breadwinner - mom was stay-at-home) made around 80K, and supported a family of 5, and had enough money to send 2 of his children to college at the same time (well 2 years overlapping). WTF???
