How to Downsize a Car With a Loan

by Mary Jayne Muraco ; Updated September 11, 2015

Many people struggle with their car payments because of the downturn in our economy. It is possible to downsize their vehicle and reduce their payment. The current vehicle needs to be appraised by a reputable dealer and paid off to remove the lien on the title. By purchasing a smaller and more fuel efficient vehicle, money will be saved in the long run.

Arrive at the dealership prepared with the bank name, account number and payoff amount. Time will be saved with this necessary information needed for the dealership to pay off the loan.

Drive your current vehicle to the dealership to be appraised. Have the vehicle in clean and good working condition for maximum trade value. Money will be deducted for any damage or obvious mechanical defects. By researching the trade in value on one of the many web sites on the Internet there is more bargaining power. Be educated on the trade in value and pricing on new vehicle

Choose a less expensive vehicle that meets your needs.The less the replacement vehicle costs, the lower the payment is going to be. Downsizing to a smaller and fuel efficient vehicle will help accomplish the goal of reducing the cost of ownership.

Prepare yourself for the facts. Salesperson will calculate the numbers after the replacement vehicle is chosen and present the new payment. If there is inequity between what the trade is worth and what is owed, the payment may not go down much. Evaluate the situation and decide if downsizing is the best move. If there is equity in the trade, it is very possible payment will be reduced. Overall costs will go down and mission will be accomplished.

About the Author

Mary Jayne Muraco worked in sales for 25 years selling cooking products, cameras and is currently selling cars for a large automotive group. She dealt with every type of personality. She is currently a student of the Long Ridge Writers Group and has been published in the Buffalo News. She has been writing professionally since 2008.