Suggestion:
well if you sell your car for $13000 you still owe the $17000 so overall you owe $14000
I Want to Trade My Car in but I Still Owe on My Loan?
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I assume that there are no conditions about the loan that prevent you from selling the car. This is the usual state of things with respect of a normal loan. However, some credit or finance agreements bar you from selling the vehicle without simultaneously paying off the remaining debt. If you have any doubts then check your copy of the loan agreement.
There aren't rules on how the math should work out. There may be guide prices based for the vehicle values based on make, model, age, mileage, condition, etc. However, even if your car is worth 13,000 no-one has to give you that much, and alternatively someone might think it worth more and pay more.
Remember that typical prices charged by professional car sellers are usually higher than with private sales, and you would typically get much less for your car traded in compared with a reasonable private sale.
Your best approach is to have good information on the values then, if feasible, sell your car privately for a good price (after you've made it look very clean and smart) to get the most money you can. Then with ready cash look for a bargain price on the car you want. Don't be afraid to make an offer below asking price.
Always be careful what you buy, in terms of condition, faults, mileage, etc. As you've focused on the financial question, I won't risk drifting more off the point with words about condition of the car, documentation, etc.
Good luck!
The math WONT work unless you have about $4000+ in cash to put down at the time of the trade.
You are upside down $4000.
Trading, even if you could, would make you $6500-8000 upside down.
So, trading the car is probably not a good idea.
You pay out your lender the $4000 difference between what you owe now and what your car is worth. Then during the next 5 years you save $2000 worth of gas in the Prius.
Really, this is not a good thing to do. Just keep the Jetta.
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