Sell the car! You may be upside down on it so get a loan from a local bank or CU to cover the difference. And most importantly…drive a car you can afford. If you are making monthly payments, you can’t afford it! Ever heard of Dave Ramsey? Radio talk show host who gives very good advice on these areas of personal finance.

Last year I went to buy a new car. I work for a mortgage bank so I know how financing worked and did my homework.

The very best interest rate they’d give me was 22.9% and this was after checking a number of dealers. I make good money and while I wasn’t happy about that rate I didn’t have a lot of choice…I needed a car.

Six months later I refinanced and dropped my rate to 13.9%. I also overpaid every single month to get my principal down. High interest on low principal is a lot less painful.

In this case the gentleman who made the mistake and bought his car at a high interest rate is stuck. If they gave him a 17% interest rate they didn’t do it because they make more money. They did it because that’s what he qualifies for based on his credit.

As was mentioned above when the dealer gets paid on financing it’s a lump sum and the actual interest rate on the loan doesn’t matter as much. The loan amount does.

Without knowing more we don’t even know if this guy got a bad deal. He may have horrible or no credit and that could explain the 17% interest.

All he can do is go to his credit union or apply for a car refi online. There is almost certainly no prepay on his existing loan since nearly every dealer uses a simple interest loan.

If he did get ripped off the only way to help himself is to refi that loan at a better institution. If he can afford it returning the car should be a last resort because (from personal experience) I can tell you it will shatter his credit. It’s taken me a good 3-4 years to recover mine.

I do find it sad that most people suggest going after the ‘shady dealer’. No one forced him to sign, and in all likelihood 17% is about right based on his credit.

Sure, he could call media attention to this. But this was his mistake…not theirs. Why penalize the dealer unless they broke a promise to him?

Of course, if they did, that’s a whole other story.

Trying to make some sort of grandstand play in the local media over this is silly.

No problems are being solved by living in fear or fear of judgment

I’ve made some bad purchases in the past but just learn from the mistake and do your best.

Regardless, if you can’t afford to buy that much vehicle, get a reliable used car next time. Many can be found for under $5K.

Also, regarding post #32, I would take it a step further and send a letter to local newspaper/TV news companies (many of them have “helping the common people” segments) and send a copy to the dealership – included with a list of all recipients. Explain that he tried to return the vehicle within 24 hours but was brushed off. If the story is newsworthy, they may run it.

My college roommate and I exposed an awful landlord who neglected us tenants after a huricane flooded us out of our homes. Local media picked up on it and we were quickly taken care of after that. Our lease wasn’t renewed at the end of the year, but at least we were able to get something done.