Cars and Transportation

The Pros and Cons of Refinancing an Auto Loan

Holly Johnson — Sun, 01 Nov 2020 17:32:44 +0000

Over the last decade, the rising cost of new and used cars have driven up the amount of the average car loan. To make up for this, auto lenders have started offering longer car loans that let consumers borrow more with a lower monthly payment.

The State of the Automotive Finance Market from Experian states the average new car payment worked out to $554 during Q1 of 2019 while the average used car came with a monthly payment of $391. Worse, the average new car loan worked out to $32,187 while the average used car loan was $20,137. Meanwhile, the average loan term was more than 68 months for new cars and almost 65 months for used.

It's never fun owing money on your car, but borrowing too much (or borrowing money for too long) can leave you wishing you had a different auto loan. This is especially true if your loan has a high interest rate because you had shaky credit when you applied.

If you're on the fence about refinancing your auto loan, it helps to know how this move could help you or hurt you. Here's everything you need to know.

Pro: You could secure a lower monthly payment

Depending on the details of your initial loan, it's possible refinancing your car loan could secure a lower monthly payment you can more easily afford. This can be important if you're struggling to keep up with your payment as it stands, or if you just need more wiggle room in your monthly budget.

With a lower monthly payment, it might be easier to stay on top of your living expenses and other bills. And if you plan to keep your car for the long haul, you may not mind extending your repayment timeline in order to lower your payment each month. (See also: Cutting Your Car Payment Is Easier Than You Think)

Con: You may extend your repayment timeline

Getting a lower monthly payment can be a boon for your finances, but don't forget you'll likely be stuck paying on your car loan for months or years longer than you would have otherwise. And this can create unintended financial consequences later down the road.

This is especially true if you're extending the loan on a used car that's already several years old. You could be stuck making payments on an older vehicle that breaks down and requires pricey repairs. This could be a double whammy for your finances later — even though refinancing saves you money on the front end.

Pro: You could get a much lower interest rate

Another potential advantage of refinancing is the fact you might be able to qualify for a lower interest rate. If that's the case, refinancing your auto loan could save you hundreds — or even thousands — over the life of your loan.

Imagine your current auto loan balance is at $15,000 and you have a 19 percent APR and 48 months left on your loan. From this point forward, you would pay an additional $6,528 in interest before your loan is paid off in four years.

If your credit score has improved, however, you might qualify for a new auto loan with a better rate. By refinancing into a new 48-month car loan at 9 percent APR, for example, you could reduce your future interest costs by more than half to just $2,917 while lowering your monthly payment in the process.

Con: You might pay more interest over the life of your loan

Before you take steps to refinance your auto loan, make sure you run the numbers with an auto loan calculator so you can compare your total interest costs. Securing a lower interest rate or lower monthly payment may be a better deal in the short term, but you may wind up paying more interest on your loan due to a lengthier timeline.

Pro: Tap into any equity you have

Refinancing your auto loan can also help you tap into any equity you have in your car. This can be a lifesaver if you need money for emergencies or simply want to consolidate debt at a lower interest rate.

Just remember that, as highlighted above, refinancing could mean more interest paid over time — even if you get a lower rate.

Cons: Refinancing isn't free

Finally, don't forget that refinancing your car loan typically comes with fees. These fees will vary depending on the auto lender you work with, but they can include an application fee, an origination fee, and an auto lien transfer fee.

Also, make sure to check that your initial car loan doesn't charge any prepayment penalties that will come into play if you refinance your loan.

Should you refinance your car loan?

Only you can decide if refinancing your car loan makes sense. It's possible switching to a new loan could save you money on interest and/or leave you with a lower monthly payment, but it's also possible a new loan will leave you paying more interest and more fees over time.

Make sure you run the numbers before you move forward, but only after comparing auto refinancing offers from at least three different lenders. By comparing multiple lenders, you'll improve your chances of ending up with a new auto loan that will leave you better off.

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This article is from Holly Johnson of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

4 Steps to Simplify Car Shopping in the New Year

Rod Griffin — Sat, 11 Jan 2020 03:03:53 +0000

The new year can be an opportune time to start looking for a new, or new-to-you car, as dealerships look to clear out previous model years. But shopping for a car isn't always as simple as showing up on the lot. There are a lot of decisions to be made between now and walking into the dealership: make and model, new or used, preferred features, type of financing to use, and the list goes on.

Before making that type of significant purchase, it's best to have a plan. Here are four steps to keep you focused and protect your financial health as you prepare to make your next vehicle purchase.

Step 1: Set a budget

Before you even begin to browse cars, it's vital to set a budget. One of the best ways to do this is to create a list that differentiates between your wants and needs in a car. If you're a commuter, you likely need fuel-efficiency, and while you may want the latest technology, like Bluetooth, it's not a necessity. Outlining your "must haves" can give you more control as you begin looking at costs, as you already know which items you're willing to forgo if it saves money.

As you look at different models, stick to cars your budget can handle, even if there was a sudden change in your financial situation, such as a job loss. The average new vehicle loan amount was $32,480 in the third quarter of 2019, according to Experian, while the average new car payment was $550. These amounts can give you a baseline as you look at your own budget to identify the total amount you feel comfortable borrowing, as well as how much of a monthly payment you can handle. (See also: 7 Easy Ways to Calculate Your New Car Budget)

Step 2: Ensure your credit is in good shape

About three to six months before you start seriously shopping for cars, make sure your credit is in good shape. Continue to pay your bills on time, and request a free credit report through Experian or by visiting annualcreditreport.com to check for fraudulent activity and to ensure all information is accurate.

Additionally, use the tools available to improve your credit, like Experian Boost before you hit the car lots. Experian Boost can increase your credit score instantly, and it gives lenders a more complete picture of your financial history, and your ability to pay off debt by looking at your on-time utility and telecom payments. (See also: 6 Money Moves to Make the Moment You Decide to Buy a Car)

Step 3: Shop around for the best loan options

More than 85 percent of new vehicles and 55 percent of used vehicles are financed. But financing isn't limited to a single type of lender. In addition to loan options offered at a dealership, it's a good idea to shop around for loans to see who has the best terms and rates available. Just because you put in an inquiry at one bank doesn't mean you can't look at another, but also consider looking at credit unions and traditional finance companies to find the best deal for your situation.

This is one area where your credit score can make a significant difference in what rates you're offered — the average interest rate for new vehicles for consumers who are in the "prime" credit tier is 4.21 percent, whereas for consumers in the "subprime" credit tier, it is 14.06 percent.

You can shop for a car loan without worrying about your credit score. Inquiries for auto loans are either counted as only one inquiry when they occur within a 30-day period, or may be excluded entirely from the calculation.

Step 4: If shopping for a used vehicle, get a vehicle history report

It's not surprising that buying a used car can be a significant cost savings. In fact, at $20,446, the average used vehicle loan last quarter was about $12,000 less than financing a new vehicle. When financing, that can mean significant savings in the amount of interest you'll pay over the term of your loan.

However, it's important to go into a used car purchase fully informed, so be sure to request a vehicle history report, like an AutoCheck report, before committing to the purchase. These reports include how many previous owners the vehicle had, or if there were any reported accidents. This can help you avoid surprises and give you a better idea of the value of the car. (See also: 8 Questions to Ask When Buying a Used Car)

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This article is from Rod Griffin of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

Ask the Readers: Do You Use Rideshare Apps?

Ashley Jacobs — Tue, 02 Apr 2019 08:30:07 +0000

Editor's Note: Congratulations to Stephanie, Alicia, and Jacqueline for winning this week's contest!

Ridesharing is becoming more and more common these days, with Uber and Lyft leading the pack as the most popular rideshare apps. There are many good reasons to use a rideshare service, but it isn't always the best option for every trip.

Do you use rideshare apps? On what occasions would you order a rideshare instead of using another mode of transportation? What do you like — and dislike — about ridesharing in general?

Tell us whether you use rideshare apps and we'll enter you in a drawing to win a $20 Amazon Gift Card!

Win 1 of 3 $20 Amazon Gift Cards

We're doing three giveaways — here's how you can win:

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Use our Rafflecopter widget for your chance to win one of three Amazon Gift Cards:

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Good Luck!

Tell us whether you use rideshare apps and we'll enter you in a drawing to win a $20 Amazon Gift Card!

This article is from Ashley Jacobs of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

How to Buy a Campervan and Travel Across the U.S.

Nick Wharton — Tue, 16 Oct 2018 08:00:12 +0000

The mania around vanlife is absolutely everywhere, gracing the covers of glossy lifestyle magazines and filling up our social media feeds. But while it's definitely enjoying a moment, it's also a trend that's not going anywhere anytime soon.

The attraction of taking to the open roads with minimal personal belongings is easy to understand, but not everyone knows how to achieve it. If you've got a dose of wanderlust and have your heart set on trying out the van lifestyle, here's how to buy a campervan and travel across the country.

How to decide if vanlife is for you

The first thing to do when thinking about buying a campervan is to decide whether you're truly cut out for the journey. Many of the Instagram pages and blogs dedicated to this kind of lifestyle make it look both effortless and romantic. In truth, it's not a way of life that will suit everyone. There are a lot of aspects of living in a van that you may not enjoy.

The most obvious one is existing in an extremely confined space. And if you're traveling with a friend or a partner, it becomes even more difficult. Keep in mind that it's also unrealistic to believe you're going to be able to keep the van clean at all times. So if you're averse to a bit of grime, you might need to rethink it.

Conversely, even though they may feel small on the inside, most campervans are significantly bigger than a car, so if you've never driven one, make sure go on a few test drives before deciding. (See also: The Easiest Ways to Save on Your Next RV Camping Trip)

Choose between a DIY or ready-made van

There are plenty of options when deciding what type of vehicle to buy, and what you settle on is an entirely personal decision. First of all, you need to decide whether you want to build your own van interior or if you're going to go for a ready-made one.

DIY

Building your own is part of the appeal for many people and it certainly has its benefits. It's usually cheaper to buy an old camper and convert it yourself, rather than purchase one that someone's already renovated. It also means that you can customize it to your specific needs.

Ready-made

Buying a ready-made camper van also has its merits, and even though it may cost more, you'll be able to hit the road right away. If you have don't have the manual skills to renovate or convert a van, then this may be your only option.

Do some research to determine what models and makes you're a fan of, then start checking sites like Craigslist and specific campervan sales sites to get an idea of how much they cost. Once you've gotten to know the market, you can make an informed decision. As soon as you see a van that tickles your fancy and checks all of your boxes, don't be afraid to make an offer.

Whatever you opt for, it's always a good idea to get a mechanic to evaluate it before you purchase, as you want your vehicle to be as reliable as possible.

Pick a route

One of the real joys of traveling in a campervan is the unparalleled freedom. However, it definitely pays to have a rough plan of where you're journey is going to take you. This way, you can avoid some of the stress over where to camp for the night, or where you can pick up groceries.

That said, you should still allow yourself the flexibility to enjoy the freedom, whether that be spending an extra night in a beautiful camping spot you've stumbled upon, or checking out a town you're never heard of on a whim. You don't need to have every minute of each day planned, just an outline of some places you want to visit and how to get between them. And don't forget to factor weather into your decision-making.

Figure out where to sleep for cheap (or free)

Paying for campsites every night can quickly add up, with some even charging prices up to around $50. So to avoid bankrupting yourself on parking spots alone, you need to work out how to camp in your van on the cheap, or even better, for free.

With a bit of research and forward planning, you can find stellar options for very little money. To start, most Bureau of Land Management (BLM) and National Forest land is free to camp on, and there are numerous free campsites all over the country. A great resource is the Free Campsites website, which lists free campsites across the U.S. (See also: How to Find Free Campsites in the U.S.)

Pack smart

Packing smart is essential to a great van experience. Without some prior planning and an idea of where everything is going to go, you'll end up with too much or too little. Not only that, but your van will be a disorganized mess, which is the last thing you want when you're living in such a tiny space.

It's also important to find a place for absolutely everything you're taking. A well-designed campervan should have lots of little storage spots that help maximize the space. While the idea isn't to fill all of these spaces simply because they're there, you should definitely ensure that everything can be put away neatly when you need to. (See also: 5 Things You Should Never Pack for Vacation)

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This article is from Nick Wharton of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

5 Unforgettable Train Trips Across the U.S.

Lindsay VanSomeren — Fri, 07 Sep 2018 08:01:11 +0000

Train travel might be a thing of the past as far as a transportation mainstay, because it's much easier to hop on a plane and be across the country in a few hours rather than a few days via train.

But if you're the type of person who loves looking at the passing scenery while on road trips, a train trip might be just the thing for you. In fact, it could be even better, because you don't even have to worry about driving. On a train, all you need to do is kick back and enjoy the view.

From long-haul cross-country odysseys to short trips heading to destinations seldom seen, you'll want to make sure to cross these five U.S. train trips off your bucket list. (See also: 5 Fun, Affordable Train Trips)

1. California Zephyr

This long-distance Amtrak experience starts out at Union Station in Chicago and winds its way through the plains of Iowa and Nebraska. Lest you think the route is full of cornfields, however, the train starts ascending into the Rocky Mountains in Colorado, passing by the ski town of Winter Park and into Utah.

You can enjoy the red rock canyons that make Utah famous, and on hot days, thank your lucky stars that the cars have air conditioning as you pass through Nevada and into California. From here, the train passes through the Sierra Nevada until its final stop in Emeryville, California.

You can book coach seats for as low as $171 one-way on this train, however, be warned: This doesn't include any of your meals, and you'll need to sleep in your seat the entire way. If you prefer a private cabin with a bed and the smallest bathroom ever (literally — the toilet is inside the shower stall), you'll need to pay closer to $700 for the ride.

2. Durango and Silverton Narrow Gauge Railroad

If a short jaunt back in time is more your style, consider Colorado's Durango and Silverton Narrow Gauge Railway (named after its tracks, which are nearly two feet narrower the tracks on most trains, so as to better handle sharp mountain curves). This train has been in continuous service between these two historical towns in southwest Colorado since 1882, when it was launched to help carry silver and gold ore from remote mines in the San Juan Mountains. It's even been in 20 different Western movies, including Butch Cassidy and the Sundance Kid, and How The West Was Won.

A round-trip journey will set you back between $89-$219 (depending on which train car you choose) and takes a total of nine hours, including a two-hour stop in Silverton, before heading back for the day to its launch point in Durango. (See also: 5 More Fun, Affordable Train Trips)

3. Alaska Coastal Classic

Alaska is known as one of the most scenic places in the world, and one of the best ways to see all the sights is by train, since you won't need to be focused on driving safely through its narrow mountain roads. There are several train routes throughout the state, but one of the best is the Coastal Classic train. This train winds through thick, foggy forests along Turnagain Arm, where you can see the famous resident belugas and other whales if you're lucky.

This train starts out in Anchorage each morning at 6:45 sharp and heads down to the resort and fishing port of Seward, arriving just in time for lunch at 11 a.m. The train stays here for seven hours, offering you plenty of time to check out the many sights in Seward, such as the Alaska SeaLife Center or Exit Glacier. Finally, it makes a return trip back to Anchorage, arriving just in time for bed at 10:15 p.m. The cost for all of this depends on which cabin you book and when you go, but you'll pay somewhere between $172 and $351 per adult, round-trip. (See also: 6 Breathtaking and Affordable Alaskan Destinations)

4. Grand Canyon Railway

It used to be that if you wanted to see the Grand Canyon, the way to get there was by this very train, which began operating in 1901. Sadly, once cars took over, the train fell out of favor and shut down in 1968. The train had a glorious rebirth in 1989, however, when it reopened for service. Today, it's estimated that the train helps keep 50,000 cars out of Grand Canyon National Park.

A round-trip ticket on this train will set you back between $67 and $219 per person for a round-trip ticket, depending on the car you choose. The ride only takes two and 15 minutes hours each way, and the train stops at the Grand Canyon for a four-hour layover before heading back that afternoon. Along the way, you can expect to see a wide range of habitats from fragrant Pinyon and Ponderosa pine forests to open prairies. (See also: 10 Most Breathtaking Day Hikes in the U.S.)

5. Mount Washington Cog Railway

Northern New Hampshire's Mount Washington is the tallest peak in the Northeastern U.S. Luckily, if you're not a mountain climber, you can actually take an authentic cog railway — a train specifically designed to climb and descend steep inclines — all the way to the top and back.

This train began operating in 1869 as the world's first cog railway. Even though the train operates many environmentally-friendly biodiesel trains today, there's still a chance you could ride on one of the antique coal-powered trains. For this reason, the railway recommends wearing "dark clothing," to keep you from walking in wearing whites and come out wearing grays.

A round-trip ticket will set you back $72 per adult ($78 if you choose one of the coal-powered trains). You also have the option of paying $51 for a one-way ticket to the top and hiking back down (it'll take about five hours, and it's only recommended for those with the right gear and are in shape). The train trip up only takes an hour before reaching the summit where you can enjoy gorgeous, breathtaking views of up to five states at once, and even the Atlantic Ocean on a clear day. Bon voyage!

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This article is from Lindsay VanSomeren of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

How to Get Your Car Ready for Hurricane Season

Annie Mueller — Mon, 16 Jul 2018 08:00:09 +0000

When you're prepping for hurricane season, it's easy to get caught up in protecting your house and making sure you're stocked with basic supplies. You may totally forget about your car. This is a mistake — in a natural disaster, your car might be your saving grace.

If you get caught in extreme weather, having a stocked, maintained, and ready-to-go vehicle can make all the difference in getting you to safety. Here's how you can prepare your car for hurricane season. (See also: What Hurricane Maria Taught My Family About Life, Money, and Community)

1. Keep it maintained

Before hurricane season starts, do a basic maintenance check. Get the oil changed, top off the wiper fluid, check the tire pressure, and clean the battery terminals. If you're mechanically inclined and have the tools, you can do these tasks yourself; while you do, check some other basics. Otherwise, take it to your mechanic to get an oil change and an inspection.

Consider also checking:

Age and alignment of tires
Windshield wipers
The spare tire
Age of battery
Fluids: wiper fluid, coolant, oil
Condition of hoses and belts
The air conditioning/heating system

If you've been putting off a car repair due to time or budget constraints, it's time to dig in and make it happen. You need reliable transportation. Schedule a time to take your car in as soon as you can. (See also: Bookmark This: Easy to Follow Car Maintenance Checklist)

2. Keep it fueled

Think about how much fuel you can safely store. In inclement conditions, gas becomes a high-demand item quickly. Keep your car's tank above the halfway mark until hurricane season is over. Buy a gas can or two and keep them filled, and follow these basic safety rules:

Only use approved containers, and store them outside or in your garage or shed.
Keep them away from children, and don't store them near pilot lights or ignition sources.
Don't store gas indefinitely; it goes bad.
Periodically use what's in the cans to fill your car, and then refill the cans.

3. Keep it insured

Make sure your auto insurance is up to date. Print out a copy of your policy information and keep it tucked in the glove box of your car. It might not be easy to access your personal files if you have to evacuate. With your insurance information on hand, even if your car is damaged, you can start the coverage process immediately.

4. Keep it stocked

The next move in prepping your car for hurricane season is to consider what you might need if you have to quickly evacuate, or if you're not able to reach your house for some time.

You can purchase a pre-packed emergency kit, or make your own emergency kit. Stock your kit with first-aid and any medication that your family members might need.

Here are some other smart items to include:

Solar-powered lights
Portable water filter or water purification tablets
Strong flashlight with extra batteries
Power inverter
Battery-powered fan
Blankets
Battery packs for your mobile devices
Ponchos for every member of the family
Small toys and games for children

It's also a good idea to have a couple of quarts of oil on hand, so you can top off your oil, if needed. Check that you have everything for changing a tire, too: a tire iron, a jack, and (of course) a spare tire. A good set of jumper cables is also a must. If you don't need them, chances are someone else will. Weathering a storm is all about helping one another.

5. Prep for meals and clothes

Keep some food basics in your car, as well. Start with bottled water, then add some nonperishable items that won't be damaged by heat. Dried fruit, nuts, beef jerky, and crackers work well. Protein gels can be helpful, too. The goal is maximum nutrition for minimal space.

You might have already packed a go-bag for each person in your family, kept in your home. Consider packing a family version as well to keep in the car: one duffel bag that can stay in the trunk. For every member of the family, include two (or more) sets of clothes, a pair of sturdy shoes, extra socks, basic hygiene supplies, and a copy of identification. Finally, include a prepaid mobile phone, a short list of important phone numbers, and a paper map with evacuation routes for your area highlighted. (See also: 13 Essentials Every Emergency Bag Should Have)

6. Stash some cash

Don't forget about money. Hurricanes and tropical storms can damage telecommunication lines and towers; if that happens, you might not be able to get cash from an ATM or even from your bank until repairs are completed. Keep a stash of cash hidden safely in your car. Consider at least $200 per person, if possible.

7. Look for shelter

The incredibly strong winds that come with a hurricane can cause all sorts of things to fly through the air. If you're going to wait out the weather, park your car in a sheltered area. A covered garage is best.

If that's not available, secure a tarp over your car to protect the paint. Parking it close to a building can provide some shelter from wind, but beware of balconies or signage that might fall off and damage your car.

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This article is from Annie Mueller of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

Should You Fix Up Your Car, Or Get a New One?

Emily Guy Birken — Fri, 06 Jul 2018 08:30:09 +0000

Your aging car's engine has been knocking loud enough that turning up the radio doesn't help anymore. You take it to your trusted mechanic, who gives you the bad news: One of your main bearings has worn out, and the repair will cost around $3,000.

Since you can't know for sure if this is just the beginning of your car's transition into a rolling money pit, or if the $3,000 repair will get you motoring happily along for another 50,000 miles, it can be nigh-impossible to figure out whether to stick it out with Old Faithful or cut your losses and buy a new car.

Thankfully, there are some guideposts that will help you to make this difficult decision. Here's what you need to consider if you are trying to decide whether to fix up your old car or get a new one.

Consider the age and safety of your ride

If you are still driving a car that emerged from the factory in the early-to-mid 1990s, you might want to factor safety into your decision of whether to repair or replace. Safety standards have grown and changed a great deal in the past 20 years, and upgrading your car to something that was built in this millennium could make a big difference if you were to get into an accident. This is especially true for anyone using an older car as a family vehicle. Newer cars have made it much easier to properly install car seats, for example, which can offer parents a great deal of peace of mind. (See also: 8 Common Car Repair Mistakes That Can Cost You)

Take rust seriously

According to automotive journalist Steven Lang, there is one type of car problem that indicates your automobile is ready for that big garage in the sky: "If the integrity of the car's frame has been compromised by rust, then you should plan on getting a new car."

While a little surface rust on a car's frame is not necessarily a big deal, your mechanic will let you know if the frame has rusted to the point where it has become dangerous to drive. "It's game over at that point," Lang states. "Cars cannot come back from that kind of damage." (See also: Bookmark This: Follow This Car Maintenance Checklist)

Find an online forum for your make and model

Even if you are not concerned about the safety of continuing to drive your aging car, you might still worry that a repair is just the tip of the iceberg, and that you'll continue throwing good money after bad if you head down this path.

While this kind of quandary was very difficult to figure out pre-internet, these days you don't have to decide what to do by yourself. Start by searching for an enthusiast forum online that is dedicated to your specific make and model of car. (Believe it or not, there are such groups for everything from Kia Sorentos to BMW E30 M3s — although the former are more likely to be "support groups" rather than enthusiast forums.)

Once you've found a forum, you can ask about the specific repair you are considering. It's likely that someone else has faced a similar problem on the same car, and they can let you know just how much more drive time their repair was able to buy them.

You can also use the forums to find out if there are common problems facing your specific car, as some cars have known issues that crop up as they age. These forums are also a great place to ask about recalls or other issues that you might not be aware of, especially if you bought your car used. (See also: Your Car Was Recalled. Now What?)

Determine cost vs. worth

So how do you know if the cost of a repair is worth it to you? For insurers, simple subtraction makes the decision easy. If the cost of a repair is higher than the Kelley Blue Book value of a car, the insurer will total the car. And if you are in a position to purchase a new car, this kind of simplified equation is helpful.

However, what a car is worth to you is not necessarily as simple as that. If you own your current car free-and-clear, and would struggle to take on a car payment, the determination of whether the cost of the repair is worth it becomes a little more difficult. A good rule of thumb in this situation is to buy a new car if the repair would cost more than one year's worth of car payments — but keep the clunker if it is less.

And don't forget the potential value of trading in your clunker, even if it needs a repair. It's tougher to sell or trade in a car in need of a major repair, but your old ride may still be worth something and can help you with the purchase of something newer or more reliable. (See also: 8 Questions to Ask When Buying a Used Car)

Answering the impossible question

You can never know for sure if you made the right call with this kind of repair-or-replace decision. But gathering all the information you can about your car's safety, its common problems, and its worth can help you to determine if a repair will serve you better than a new car.

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This article is from Emily Guy Birken of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

How to Score an Empty Seat Next to You on Your Next Flight

Jason Steele — Wed, 20 Jun 2018 08:30:23 +0000

When it comes to being comfortable on an airplane, having an empty seat next to you can be the single most important factor. After all, most domestic first class cabins have just two slightly wider seats per row, rather than three seats. So having an empty middle seat is almost like being in first class. And while most people attribute it to luck when they have an empty seat next to them, there are actually several ways you can influence the outcome. (See also: 10 Ways to Get Free (or Almost Free) Airline Tickets)

Choose a seat toward the back

As soon as you make a flight reservations, most airlines allow you to select a seat assignment. And in general, most passengers choose seats in the front of the plane in an aisle or a window seat, not a middle. This means that the last seats to be chosen are the middle seats in the back of the plane.

When you are selecting a seat assignment, to maximize your chances of sitting next to an empty seat, sit as far toward the back as possible, especially if you're flying on a domestic route. If the plane is a widebody, sit in the center section of seats rather than in the seats in the side sections. (See also: Best Airline Credit Cards)

Consider the back of the extra-legroom section

Another strategy involves the extra-legroom seats that most airlines offer. These are in sections sometimes called economy plus, comfort plus, or main cabin extra. Seats in these areas are available to flyers who hold elite status in the airline's frequent flyer program, or to anyone else who pays an extra fee. On domestic flights, these may fill up if there are a lot of business travelers, because many of those road warriors have elite status.

But on international flights, these seats are often the last to be filled because many leisure travelers are unwilling to pay the extra fees. Therefore, the rows at the back of this premium section may be even more likely to have an extra empty seat than the rows of standard seats at the very back. If you hold elite status or choose to pay for the extra legroom, then this is where you will want to sit to have the most chance of an empty middle seat.

When traveling as a couple, try to book both the aisle and the window seats, leaving the middle open. If the middle seat is occupied but you still want to sit next to each other, you can be confident that the passenger in the middle seat will gladly swap and take the aisle or window seat if you offer it. (See also: 5 Ways to Get Extra Legroom on Your Next Flight — for Free)

Use the airline's app

If the tips above fail and you're assigned a seat you don't want, check the airline app when you're at the gate. You may be lucky enough to spot a seat that's available next to an empty seat and if so, some apps will let you change your seat right then and there. If not, try asking the gate agent to make the swap. It won't always work, but it never hurts to check.

On Southwest Airlines, aim for the middle

Southwest Airlines doesn't offer seat assignments, so you have to use a slightly different strategy to find an empty middle seat to sit next to. As with other airlines, Southwest passengers prefer to occupy the seats in the front of the plane, as well as the aisle and window seats. However, I've observed that some Southwest passengers will walk all the way to the back of the plane to look for an empty aisle or window seat, rather than take empty middle seats near the front of the plane.

Therefore, if you have the option, it's best to take an aisle or window seat near the middle or even the front of the plane, since those passengers often walk past those seats in the hopes of finding an aisle or a window in the back. Even if there are only middle seats left in the back of the plane, some passengers will occupy those rather than turning around and going back to the front of the plane. Besides, doing so is impossible if others are still boarding. (See also: How to Get a Great Seat on Southwest)

Beyond that, some Southwest passengers have resorted to questionable behavior to save an empty seat next to them, such as placing an item on it or making themselves seem as unappealing as possible as seatmates. This can include spreading themselves out, pretending to be sick, or simply engaging in a loud telephone conversation while boarding.

I don't recommend any of those tactics. You'll likely have to sit in close quarters with these folks and you don't want to be making enemies before the flight has even started. Anyway, these behaviors will make no difference if the flight is completely sold out.

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This article is from Jason Steele of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

Best Money Tips: When Is the Best Time to Buy a Car?

Amy Lu — Tue, 19 Jun 2018 08:00:35 +0000

Welcome to Wise Bread's Best Money Tips Roundup! Today we found articles on the best time to buy a car, ways to make the most of your time and money, and how to handle sentimental clutter.

9 Ways to Save Big on Parking Costs

Tim Lemke — Tue, 12 Jun 2018 08:30:34 +0000

Have you ever given thought to how much money you spend just placing your car on a spot of land? When you think about it, paying to park is an enormous waste of money. Yet we do it anyway, and we often make matters much worse by being careless about how we park.

Parking fees and tickets can be a killer to your budget. But you can avoid parking costs with a little bit of planning and change of habits. Here's how.

1. Know when to go

In many cities, parking fees are lifted on certain days and times. For example, it's free to park almost anywhere in the District of Columbia on Sundays. If you intend to visit a location and take time to learn when parking fees are waived, you can then choose to travel during those times to avoid parking costs.

2. Give yourself time

We've all been in this situation: You're running late and park in the first spot you can find. You pull into an expensive garage because you don't have time to circle the neighborhood looking for street parking. It may cost you several dollars extra every time you park in a rush. My rule of thumb is to estimate how long it takes to get to a destination, especially in the city, and add 20 minutes to find acceptable parking. Budgeting less time often means settling for a spot that's unnecessarily costly.

3. Take advantage of a pretax parking plan

If you pay to park at your job, your employer may offer a pretax benefit, allowing you to take money out of each paycheck to pay for parking. By doing this, you reduce your taxable income slightly and may save some money. Your employer may also have other special discounts or parking plans for frequent parkers. Check with your company's human resources department to find out what parking programs they offer. (See also: 10 Things Besides Salary to Negotiate at Work)

4. Use a website to reserve parking

There are a number of websites that allow you to search for parking in garages or even the street, potentially saving you money if you pay in advance. These sites let you search for the cheapest spots in the area you'll be visiting. It definitely beats driving around cluelessly trying to find the best parking deal. I've personally used Parking Panda with some success, but there are others, including ParkWhiz.

5. Use an app to pay for parking

If you were unable to reserve parking in advance, you may be able to pay for metered parking using an app such as SpotHero or Parkmobile. These apps can help you avoid parking tickets because they tell you how much time is left on a meter and you can add money straight from the app — no running back to your car or scrambling to find change. Tip: Download the app via Wi-Fi before you depart for your destination to save time and data. (See also: The 11 Best Parking Apps for Your City)

6. Use an app to fight the ticket

Many people end up paying tickets they didn't deserve because they don't want to deal with the hassle and time of fighting them. Fortunately, there's an app for that. Several apps, in fact, will allow you to take a picture of your ticket and send it to a legal adviser, who will handle all of the work. Off The Record is one app capable of doing this. There are fees associated with these services, but some companies will offer you a full refund if you are found guilty.

7. Learn to parallel park

Many people will park in pricey garages or pay-to-park lots rather than the street because they don't know how to parallel park. Not only is street parking usually cheaper, but in fact, it's often free on certain days and times, assuming you know where to look.

Parallel parking is tricky, but it's a skill worth obtaining. You can impress your friends — or even a date — by fitting your car in a tight spot against the curb. (See also: Skills That Can Save You Money Part 1: Parallel Parking)

8. Don't drive

You can't get a parking ticket if you ride the trolley. You'll never overpay when you ride your bike. And you get a lot more exercise when you lace up your shoes and walk. There are a lot of great reasons to walk, bike, and take public transit to get places, and avoiding parking costs is certainly on the list.

9. Carpool

If you have five friends all heading to the same destination, there's no need for you to all drive separately. Carpooling will save you money on gas and, most importantly, parking. Imagine splitting a $20 parking fee down to $4 per person. This is why you have friends!

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This article is from Tim Lemke of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

These 8 Modern Car Features Are Riskier Than You Think

Dr Penny Pincher — Mon, 11 Jun 2018 08:30:18 +0000

If you're in the market for a new car, you may be paying close attention to some of the more modern features than can improve your driving experience. While some newer car features improve the safety and convenience of your vehicle, others can make your ride more dangerous. Here's what you need to know to stay safe with modern car add-ons.

1. Air bags

Air bags provide a significant improvement to vehicle safety overall, but there are certain situations where they present a hazard. Air bags can be dangerous to children or adults of short stature due to the close proximity of shorter individuals to the front bag when it deploys. To reduce risk of injury, seat shorter folks in the back seat, or adjust the front seat to a position further away from dashboard.

Another problem in recent years is faulty air bags. When buying a used car, check to see if it falls into the massive recall for Takata air bags that can malfunction and spray shrapnel when they deploy. (See also: Your Car Was Recalled. Now What?)

2. Keyless ignition

Keyless ignition is a convenient feature that allows you to start your car remotely. A keyless ignition fob allows you to press a button and transmit a radio signal to start your vehicle. But this convenience can come at a dangerous cost. Without the need to turn a key or actually sit in the car, it's easy to forget that the engine is running. You may inadvertently create a carbon monoxide hazard in a garage or other enclosed space. Always check that the engine has been turned off when you exit the car.

3. Touch screens

That big screen on the dash that runs the climate controls, shows you a map, and controls your music can be a major distraction. Not only does the display catch your attention, but dynamic touch screens take a lot more focus to use than old fashioned knobs and buttons that you can learn to operate by touch from muscle memory. Touch screens have different menus for different functions and typically require the driver to look at the screen to see where to press, diverting attention from the road. Practice safety first by not using the touch screen while driving.

4. Jacked-up vehicles

Jacked-up vehicles have been trendy for quite some time, going back to the SUV craze in the 80s and the Hummer craze in the 90s. Driving a large vehicle that sits high above the ground provides a commanding view of the road, but handling can be compromised. Tall vehicles have a higher center of gravity and heavier tires, which results in a greater risk of rollover.

Driving a jacked-up vehicle also poses risks to other cars on the road. Instead of meeting bumper-to-bumper in a collision, a smaller car might take the bumper of a jacked-up vehicle through the windshield, greatly raising the risk of serious injury or fatality.

5. Roof racks

Much like with a jacked-up SUV or truck, placing heavy items on top of your car raises the center of gravity and increases risk of rollover. In addition, items placed on roof rack may become loose during transit, presenting a risk of injury to pedestrians or passengers in nearby vehicles. Finally, attempting to lift cargo up to a roof rack can cause back injuries.

6. Overstyling

Styling can make an ordinary car look cooler and more expensive, but it can also make cars more dangerous. Dark tinted windows can reduce visibility for the driver, especially at night. This problem gets worse in cars that have lots of electronic displays that can create glare. Chunky pillars make vehicles look sturdier, but also make it harder get a good view of oncoming traffic or obstructions.

7. Super-bright headlights

Some expensive sports and luxury cars come with high-intensity discharge (HID) lights, often using xenon gas, that generate very bright light with a bluish hue. Some vehicle owners upgrade their standard headlights to HID to make their car seem more expensive. While bright headlights can improve visibility for the driver of the car equipped with them, the bright lights can produce glare and reduce the vision for oncoming motorists.

8. Cruise control

Cruise control can make long distance driving much easier — just reach your desired speed, and you can set your cruise to maintain speed without working the accelerator. The problem with cruise control is that it tends to promote unsafe driving behavior and reduces reaction time. Drivers using cruise control tend to cruise right up on slower vehicles before making a quick lane change to pass. Be vigilant at all times while driving — cruise control is not autopilot.

Cruise control can also be dangerous in slippery conditions that can result in the tires spinning out of control when there is not enough friction between the tires and the road. You should never use your cruise function in poor weather conditions.

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This article is from Dr Penny Pincher of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

7 Ways to Tell If That Used Car Used to Be an Uber

Mikey Rox — Thu, 07 Jun 2018 08:30:31 +0000

There are plenty of things to consider when buying a used car: the vehicle's make, model, mileage, and accident history. One potential deal breaker that you may not have even considered is whether the vehicle was used for ride-sharing services like Uber or Lyft.

While laws in your area may require car sellers to indicate if the vehicle was used as a taxi or limousine, the law may not be as clear about ride-shares. To make an informed decision about your next used car purchase, here are some things that can help determine if your prospect was once used for carting around large volumes of passengers. (See also: 8 Questions to Ask When Buying a Used Car)

1. Lots of miles in a short amount of time

According to the U.S. Department of Transportation, Americans drive an average 13,476 miles annually. Any odometer with 20,000 miles or less per year shouldn't raise red flags. It's when you get into the 40,000-to-50,000-miles-a-year range that you should ask about whether the vehicle was used for commercial purposes like deliveries or ride-sharing, even if it's not listed as such.

For instance, if you're looking at a 2016 model that already has 100,000 miles on it, and it's listed as a personal-use vehicle, it's highly likely it was used for commercial purposes. That doesn't mean it's not a good car or it won't serve you well, but it may require extra TLC before most other vehicles its age. (See also: How to Buy a Used Vehicle Without Getting Ripped Off)

2. Above-average wear and tear in the back seat

Usually you'd concentrate on the wear and tear in the front seats of the vehicle because that's where you'll spend most of your time when driving. But if you're trying to determine whether or not the vehicle was an Uber, inspect the back seats. If the car was transporting passengers on a regular basis, you can expect to see more wear and tear back there, especially on the right side of the vehicle as that's the side on which most passengers enter, exit, and stay seated during the ride. (See also: A Used-Car Salesman Reveals Dirty Tricks (and How to Avoid Them)

3. Unusual amount of fender-benders

When you review the Carfax vehicle history report (and you should), take note of any fender-benders and other repairs to the vehicle. If there seems to be an unusual amount of these occurrences, there's a possibility the vehicle was used for ride-sharing. The likelihood of getting into accidents and experiencing other damage is higher for Ubers than standard personal-use vehicles because the former is on the road much more often.

4. Sticker residue on windshields

In all markets, ride-sharing vehicles are required to display the company's emblem, which is often adhesive, on the windshield. Uber and Lyft both offer non-adhesive emblems in some markets, so you might have to look a little harder. For instance, search for signs of smaller stickers from permits granting the right to service airports. Those are now required in certain areas.

The longer these stickers are affixed to the glass, the harder the adhesive is to remove completely, even when the sticker is peeled off. If the residue doesn't look like typical DMV required stickers, it's likely from a permit of some sort.

5. Stains on the upholstery

Sure, anybody can leave a stain by accident, but if it looks like someone has vomited on the back seat, someone has probably vomited on the back seat. It could've been a child, or it could've been a drunk guy. You make the call.

"You should also look at the condition of the upholstery and the padding underneath," says Jim Milan, communications manager for Auto Accessories Garage. "Most vehicle seats should stay in pretty good shape even over the years, while an Uber or Lyft might seem especially indented or may show some light tearing around the seams. If the bucket seats seem a bit too bucket-y, be wary."

6. Ride-sharing paraphernalia in the glovebox

You might get lucky. The previous owner of the car may leave evidence hidden in the car that reveals its past, such as an airport permit or extra Uber stickers, says Harry Campbell, author of The Rideshare Guide. Inspect the glove compartment and any vehicle pockets for indications that the vehicle was used for ride-sharing.

7. Extra-worn door armrests in the back seat

You know how all the wood railings leading to amusements park rides are super smooth from years of people touching them with their oily hands? Well, the same sort of thing happens to the side armrests in cars as a constant flow of passengers opens and closes the doors and rests their arms and hands on them.

If these areas look worn — and there are no other signs that kids dominated the back seat — take it into consideration. Another sign is when the symbols on the window controls in the back seat are rubbed off partially. Sporadic back seat passengers wouldn't cause that much fading.

When in doubt, ask the seller or consider walking away

If any of the above signs raise your suspicions, you can always ask the seller if the car has been used for ride-sharing. They may not tell you, but if they do fess up, take that into consideration when negotiating the price. If they won't tell you, or if you're still in doubt about the car's history, it may be time to pass the car by and look for a vehicle you can feel more confident about.

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This article is from Mikey Rox of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

Best Money Tips: Cheap Ways to Keep Your Car Cool in Summer

Amy Lu — Mon, 14 May 2018 08:31:14 +0000

Welcome to Wise Bread's Best Money Tips Roundup! Today we found articles on cheap ways to keep your car running cool in the summer, tips for hosting a guest with dietary restrictions, and ways to make you wedding better for your guests.

7 Things That Affect Your Car Insurance Rates

Tara Struyk — Thu, 10 May 2018 08:30:16 +0000

If you've ever shopped around for car insurance, there's one thing you may already realize: Calculating rates is not an exact science. This is why you can get relatively different quotes from different insurers. It's also why you should shop around.

That said, your rate is also affected by a variety of factors — some of which you can control, and some of which you can't. You probably already know that factors like your gender, age, and driving record affect your auto insurance rates, so we reached out to a few experts to find out what other, lesser-known factors can affect your premiums. Here are a few.

1. The kind of car you drive

You can probably guess that if you drive a $100,000 sports car, you're going to have very high insurance rates. But there are a lot of other common details about your car that could affect your insurance rates.

According to Mark Nicholson, marketing director at auto marketing company Absolute Results Productions Ltd., these include the safety rating of your vehicle, its size and age, and even the likelihood that it might be stolen.

"Another factor some providers use is how much horsepower your engine has, because by their logic, it suggests that you're more likely to drive fast and are at greater risk of getting into an accident," Nicholson says.

This is why when you're buying a new car, it's a good idea to call for insurance quotes before you actually make your final purchase decision. If the new car you choose is considerably faster or sportier than the one you're driving now, that'll be reflected in a higher insurance rate.

For example, if you're considering a 4x4 SUV, you need to consider that a factor as well.

"Even if 90 percent of 4x4 SUVs will never be driven off-road, the insurance company will assume you'll want to take the occasional trek up a mountainside or fly down that dirt path through the woods. That's a higher risk, and you'll pay more for it," says Chris Burdick of Automoblog.net.

Even if you opt for a super-practical family sedan, you still might get stuck with high insurance premiums.

"You'd think that the more common the car, the less insurance will be, but that's not always the case," Burdick says. "For example, if you own a Honda Accord, it's considered to be one of the most stolen cars in the U.S. Same with the Honda Civic, Nissan Altima, Chevy Impala, and Toyota Camry. If you own a car that's stolen frequently, your insurance company will find that to be a higher risk and your insurance rates will go up accordingly."

Bottom line? Talk to your insurance company before you choose a new car to ensure that insurance rates for the vehicle you're considering are in line with what you're willing or able to pay. (See also: Here's How a Claim Will Impact Your Car Insurance)

2. Poor credit

Yup, they're watching you. In fact, your insurance company probably uses quite a few facts about you — both basic and personal — to calculate your car insurance rate. Some of the most common factors that will count against you and raise your rate include being under 25, being male, and having a poor credit score.

"We can see a difference in rate of 100 percent or more in premium increase for someone with poor credit," says Joe Espenschied, agency principal and owner at Insurance Brokers Group. "When we have a quote for someone with a clean driving history — but a very high insurance premium — it's due to credit."

At least credit (unlike age and gender) is a factor you can control. But there are other interesting details about your life that could impact your premium, too.

3. Homeowner status

Sophia Borghese, a consultant for Superior Honda in Louisiana, says that being a homeowner can impact your insurance rate, much like your credit score.

"Homeowners are lucky. It's thought that they do not have as many financial issues as renters. Because of this, insurance companies trust and reward them by not giving them the burden of high rates," Borghese says.

4. Marital status

Another personal detail many insurers consider is your marital status. Some insurers see married drivers as being more responsible than single ones. In fact, a 2004 study by the National Institutes of Health and reported on by DMV.org found that singles were twice as likely as married people to get into automobile accidents.

"The amount by which your rates drop can vary greatly based on your other circumstances, although men's rates tend to drop more than women's when they get married," says Steve Pritchard, founder of insurance comparison site Cuuver. "However, those who have a driving history free of accidents, and a clean driving record before getting married, could see their rates reduced by almost half of what they were paying before they tied the knot."

5. Your career

There's one more personal wild-card that could have an impact on your premium: your job. According to The Zebra's 2018 State of Auto Insurance Report, drivers with full-time jobs will save about $30 on car insurance over those who are unemployed, while active duty military and veterans will get a discount of about $50 over civilians. If you use your vehicle for work, you can also expect to see your rates go up.

6. How and where you drive

We all know that our driving records affect our insurance rates, but there are lots of other components of how and where you drive that can affect premiums as well.

The distance of your commute to work can affect your premium. After all, if you're on the road longer, you're considered higher risk. (Which is why you should definitely inform your insurance provider whenever your commute changes.)

Where you live and drive is also scored according to cases of vandalism, the number of claims and fraudulent claims in that area, cases of vehicle theft, and the occurrence of damaging weather, such as flooding or hurricanes.

But insurance providers are also moving beyond statistics and data about your past behavior to provide insurance based on how you are actually driving day to day. This involves installing what's called a usage-based insurance device into your car, which tracks your driving behavior.

"If you practice safe driving habits, don't frequently drive between 12:00 and 2 a.m., or use lots of high-traffic routes, you could qualify for up to a 30 percent decrease in insurance rates," says Anna Drake, the insurance producer at Insurance Shop LLC. Of course, if your driving habits are less than stellar, this type of policy could also drive your rates upward.

7. And then there's the "secret sauce"

While most insurance companies use some combination of the same or similar factors to calculate your insurance rate, there's no standard calculation.

"Each company compiles its own factors to find its own 'secret sauce' or 'ideal insured.' When the individual hits a company's sweet spot, it will reflect in pricing and coverage," says Janine Fixmer, an independent insurance agent at Agency Insurance LLC.

This why it's so important to shop around for the best rate and coverage, and to try to keep a handle on the factors insurance companies consider that you can control — such as your driving record, credit score, and the type of vehicle you choose to drive. (See also: 6 Mistakes to Avoid When Shopping for Car Insurance)

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5 Ways to Get Out of a Car Lease Early

Kat Tretina — Thu, 12 Apr 2018 09:00:06 +0000

Leasing a vehicle is still a popular way to finance a new car. According to Experian, nearly 30 percent of all new vehicles were leased rather than purchased during the fourth quarter of 2017. Leasing comes with some initial perks; you can often get a much nicer car than you could afford buying outright, and it's a tempting option to trade in for a newer model every few years. But the payments and restrictions of a lease can quickly get old.

Whether you are sick of your current vehicle, or can't afford your lease payments any longer, getting out of a car lease can be tricky. However, you do have a few options when it comes to freeing yourself from a car lease that is no longer meeting your needs. (See also: What You Need to Know Before Leasing a Car)

1. Transfer your lease

Easily the most convenient of your options, transferring your car lease is the most popular way out of it. Many dealerships will work with you to get you in a new car. They might buy out your old lease so you can open up a new one with them. If you stick with the same car manufacturer, you're more likely to be able to transfer your lease to a new vehicle.

2. Swap your lease

Some auto manufacturers allow you to swap your lease with another individual. However, you should know that the lease transfer doesn't necessarily remove you from being the responsible party. Should the person who takes over your lease stop making payments, you may still be on the hook for the missed payments. Make sure to carefully look over the terms and agreement before you finalize the transfer.

Additionally, you may be required to make some concessions that lowers the monthly payment for the person who takes over your lease. These payments are usually one-time and range from $500 to $5,000. To learn more, check out a lease swapping site like LeaseTrader or Swap A Lease.

3. Pay the penalty to return the car early

In nearly all auto leases, you have the option of being released from the contract if you pay a penalty fee. It can be expensive and paying the penalty isn't ideal, but if you're determined to get a new car or get out of the lease, paying it might be worthwhile.

Generally, you will need to pay some kind of termination fee in addition to the remaining depreciated value on the car. Keep in mind that the depreciated value can be a lot of money in the end.

4. Trade or sell the vehicle

Many people don't realize that they can, in fact, buy the car out of their contract and sell it independently. This approach may be a far better option than paying a penalty to get out of the contract.

However, buying the car out of your contract can take a bit more elbow grease on your behalf. First you need to contact the leasing company — not the car dealership — and find out how much it costs to buy out your contract.

Once you have this number, you will have to pay an early termination fee. That fee can be in the neighborhood of $200 to $500 in addition to the buyout amount. The buyout amount will generally be less than current market value — but not always. You are more likely to come out ahead if you put a large down payment on your car at the onset of the lease.

Once you own the car, you are free to do whatever you like with it — include sell it. This is a great option if you're sure you can sell the car easily. (See also: Should You Buy Your Leased Car?)

5. Contact the leasing company

If you experience a financial hardship and cannot afford your payments, you may want to consider contacting your leasing company directly.

Depending on your leasing company and your contract, you may be able to work out a temporary alternative payment plan. You could get a lower payment for a few months or even postpone your payments altogether. You'll pay more in interest over time, but it can give you a little more breathing room in your budget while you get back on your feet.

Before you look into options for getting out of your car's lease, it is important to review the terms of your contract so you understand exactly what your options are. Before falling behind on your payments or taking any drastic action, contact your leasing company directly to see what you can do with your car.

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This article is from Kat Tretina of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

Cars and Transportation

The Pros and Cons of Refinancing an Auto Loan

Pro: You could secure a lower monthly payment

Con: You may extend your repayment timeline

Pro: You could get a much lower interest rate

Con: You might pay more interest over the life of your loan

Pro: Tap into any equity you have

Cons: Refinancing isn't free

Should you refinance your car loan?

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4 Steps to Simplify Car Shopping in the New Year

Step 1: Set a budget

Step 2: Ensure your credit is in good shape

Step 3: Shop around for the best loan options

Step 4: If shopping for a used vehicle, get a vehicle history report

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Ask the Readers: Do You Use Rideshare Apps?

Win 1 of 3 $20 Amazon Gift Cards

Giveaway Rules:

How to Buy a Campervan and Travel Across the U.S.

How to decide if vanlife is for you

Choose between a DIY or ready-made van

DIY

Ready-made

Pick a route

Figure out where to sleep for cheap (or free)

Pack smart

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5 Unforgettable Train Trips Across the U.S.

1. California Zephyr

2. Durango and Silverton Narrow Gauge Railroad

3. Alaska Coastal Classic

4. Grand Canyon Railway

5. Mount Washington Cog Railway

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How to Get Your Car Ready for Hurricane Season

1. Keep it maintained

2. Keep it fueled

3. Keep it insured

4. Keep it stocked

5. Prep for meals and clothes

6. Stash some cash

7. Look for shelter

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Should You Fix Up Your Car, Or Get a New One?

Consider the age and safety of your ride

Take rust seriously

Find an online forum for your make and model

Determine cost vs. worth

Answering the impossible question

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How to Score an Empty Seat Next to You on Your Next Flight

Choose a seat toward the back

Consider the back of the extra-legroom section

Use the airline's app

On Southwest Airlines, aim for the middle

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Best Money Tips: When Is the Best Time to Buy a Car?

Top 5 Articles

Other Essential Reading

9 Ways to Save Big on Parking Costs

1. Know when to go

2. Give yourself time

3. Take advantage of a pretax parking plan

4. Use a website to reserve parking

5. Use an app to pay for parking

6. Use an app to fight the ticket

7. Learn to parallel park

8. Don't drive

9. Carpool

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These 8 Modern Car Features Are Riskier Than You Think

1. Air bags

2. Keyless ignition

3. Touch screens

4. Jacked-up vehicles

5. Roof racks

6. Overstyling

7. Super-bright headlights

8. Cruise control