I assume you are in the States (I’m in Canada) but a scenario would be this.
- SUV is ~$400 per month to purchase. Two years left on the loan.
- Used Grand Prix ~$8000.
- Trade in value on the SUV ~$8000.
- Refinance the Grand Prix over 4 years ~$200 per month.
Is that some sort of a worthwhile idea? It cuts your vehicle payment in half, doesn’t take the equity from your home, gets rid of the gas guzzler, and leaves you with a decent sized car for your family.
I’m just guessing at numbers, you will have to see what you can get for your SUV and what a worthwhile replacement car is worth. This was just what I was considering.
Oh, and the discount on your insurance may be noticable as well. SUV’s are rated higher, especially the 2 door models.