sherpaxc wrote:
So I have to admit I'm one of the people that got this conversation going and as I sit back in my computer chair I have to laugh. It is so easy to stir the pot on here. Some people can be way to passionate on the internet.
Anyway, the OP actually proved my originally point. I'll say it again. A loan (debt) isn't the worst thing in the world when managed wisely. We can all agree on that I think. What is bad is when that debt is compounded by more debt, then more.
Yes, the OP can afford his current 15 year loan. But he admits he also took a loan out on a truck AND on a snow mobile. This is our America today. A buy today and worry about it later society. I don't think the OP (and many people) realize how much INTEREST he is paying with all these loans. It would probably make him sick.
I stand by my statement. Sell it, cut your losses, get your savings built up, then buy something used and less expensive. It is a hard pill to swallow, but I think it is the right pill.
I feel for the op. I've been there for sure. It was a big mistake and I lost money. But since then I've learned a great deal about financial freedom.
I also agree with most of the Dave Ramsey stuff. He has very good intentions and does a great job helping people like me who AREN'T financial genius's make sound decisions. His word isn't law, but it's good nevertheless.
You make a lot of valid points by saying to sell it and take you lumps BUT, in many cases doing so is not really warranted so it would not be ideal for everyone.
Near as I can tell, the OP HAS the income to support payments on all three items (that is a good thing). So basically the OP is not struggling to make the payments or pay other bills (that is a good thing).
From what I see the OP is concerned that:
#1 they have a loan of too long of a term (I would agree).
#2 They will pay too much interest for the trailer (I would agree)
OP is simply asking how best to manage paying down some of this debt (I would agree that paying down is a wise thing).
Selling off at this point in time will actually not be a good idea for these reasons:
#1 OP would most likely have to take out another loan to make up for the upside down loan balance.
#2 OP would most likely have to take a personal loan to make up for short fall(typically banks cap or limit the dollar amount borrowed and the lenght of payback on personal loans pretty low and will have possibly higher than 9.9% interest rate due to no "collateral" which may cause the OP to be paying a higher payment and have no trailer to show for it)
#3 If OP has a home, they could possible take a loan out on the "equity" but that further ties up their home in debt or may not have enough equity or even don't have a home (IE rent).
#4 no matter how you slice it, they owe MORE than the trailer is worth on the used market and they WILL be paying on a loan just in order to make it go away..
#5 OP most likely CAN "manage" their current debts without the "need" to unload the trailer, just needs to figure out where to start, create a workable plan of attack then stick to it.. That is why I have suggested they seek some local advice from a real Financial adviser.
I personally feel that cash is "king" but there ARE times in life where a loan (debt)is not a bad thing provided that you maintain control of that debt.. Allowing debt to take control (IE buying too many unneeded things on credit) is where it all goes wrong.
