This Thanksgiving holiday gave most of us something else to be thankful for - lower gas prices. When gas prices hit over $4 a gallon a few months back, consumers freaked and went crazy trying to sell the large model vehicles that consumed just too much gas to be worth keeping. However, as gas prices have steadily fallen in recent weeks, averaging now around $1.85 a gallon, it may make more sense to keep what you have, especially if you are not in need of a new model.
Here are some good reasons to take the sale sign off of your vehicle:
The Current Value of Your Vehicle
If you are driving an SUV, known that because there is already a surplus of such vehicles, the trade-in value are now at an all-time low. If you want to trade yours in, be prepared to take a loss and have to come up with that much more money to put down on your next vehicle. This means essentially you will not end up saving yourself any money.
The Potentially Higher Insurance Rates
Many who want for a new vehicle fail to think about how the change will affect your current insurance premiums. If you are looking to trade in a vehicle simply to save money on gasoline, you are likely to end up spending more of your cash on insurance. For example, if you want to trade in your SUV for a hybrid vehicle, you can expect to pay increased insurance costs because hybrids cost more money to repair in the event of an accident, as are many new brand new cars when compared to an older model.
Bad Time for Financing
With the economy still in turmoil, you may find it very difficult to get reasonable financing. It may also be difficult to find any financing if your credit score is not top-notch due to the stricter guidelines for funding. Even those with excellent credit may find lenders may not be able to take advantage of the 0% financing deals and will end up paying more in interest than you would with your current financing agreement.
Stuck Under Your Vehicle
If you originally took out a loan for five or more years, you may owe more on the vehicle than it is currently worth. Being upside down on your vehicle loan means you will have to spend more money unless you are capable of making a full payoff before trade-in.
Outside of the monetary concerns with trading in your SUV, you may be surprised to find that a new, more efficient model may no longer accommodate your family. When you are used to a roomy minivan or a larger SUV, a newer smaller model may prove to be a hindrance you hadn't before considered. Downsizing a vehicle before you have downsized your family doesn't make sense.