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My husband and I decreased our total debt by $35,000 in a matter of 2 weeks. Yes, you’ve read that right.

Nope, that amount was not in our savings account.

We didn’t win the lottery.

We weren’t gifted that money.

debt pay off

Values exercise

Want to know what we did? I’ll tell you, but first I want you to do something.

Take a moment to think about what your most costly payments are every month (if your only expensive payment is your student loans, skip this exercise).

So, have you made a mental note of your most expensive payments every month? Now ask yourself this, “Would I be willing to let go of these things in order to get out of debt faster?”

Are you attached to your belongings? The things that cause you to spend the most amount of money each month, are they out of necessity or comfort and convenience?

Alright, now that you have made some conclusions about your values, I’ll move on.

We got rid of our cars

We sold our cars and most of the debt that came with them. My monthly payment was $457 and my husband’s monthly payment was $593. That’s $1,050 of payments to the bank for CARS every month.

Absurd, I know!

We drove fairly nice vehicles

I drove a 2013 Chevrolet Traverse that I purchased in October 2017.  My previous car needed more work than it was worth and more than we could afford to pay for then. The car loan was originally about $24,000.

My husband had a 2016 Ford F-150 truck. Like most of the vehicles we’ve purchased, this one was unexpected, but needed. He got into a car accident in July 2018 and totaled our Chevrolet Trailblazer. There was only $1,000 left to pay it off. Talk about bad timing. The truck auto loan came to about $35,000.

Total auto debt

Our total car debt in February 2019 was right around $50,000.

How we learned about this method

I was actually watching YouTube videos about other people’s debt free journey. I came across a video by Frugal Freaks and she talked about how her and her husband sold his truck and purchased a cash car.

She laid out the basic steps they took to achieve that.

Our conversation

My husband overhead me listening to the video and asked about my motives. Initially I just wanted to get rid of my car because I put a lot of miles on my car for my day job. But, it made sense to get rid of my husband’s car too because his car payment was almost $150 more than mine.

Turns out, he was more attached to his truck than I was my car. I get it, he’s always wanted a truck and he had a NICE truck – always got complimented on it too.

However, we had a talk about our values, priorities and long term goals. Two weeks later, the cars were gone and so was $35,000 of our debt.

Interested in doing the same? Want to learn about the process to figure out if that’s something you may want to consider at some point? I’ll lay out the step by step process that we took.

Step 1 – Determine how to afford a cash car

My husband and I knew our savings were slim so we decided to that we would borrow from our 401K and add money to it from our monthly budget to purchase cash cars.

The cash may come in the form of a savings account. A tax refund may be the saving grace. Perhaps, someone is willing to gift the amount. A family member or friend may be willing to sell you a car at a low price. Maybe the cash can be squeezed into the monthly budget relying on  your income. Decide on which method best suits you.

Step 2 – Determine how much money is still owed on the car(s)

My car had about $19,000 left on the loan and my husband’s car had about $31,000 left on the loan.

Step 3 – Figure out the value of the car(s)

Kelley Blue Book is a starting point. However, we wanted to know what an actual dealership would pay for the car, so we did just that and went to a dealership.

Carmax is known for not requiring you to buy a car from them in order for them to buy your car. So, we headed to Carmax for an appraisal.

They offered us $21,000 for my husband’s car and didn’t even give me an appraisal offer because they told me the car I purchased from them a little over a year ago had transmission and engine issues, go figure.

Their appraisals are good for 7 days, so we had 7 days to decide if we would be able to accept their offer.

Another option for selling your car

Once you know how much you owe on your loan, you could try to sell your car to a private party for that amount to satisfy your loan.

Offer up, Let go, Facebook Marketplace, and Craigslist are popular places to advertise.

Step 4 – Figure out the difference between what’s owed and what’s offered 

In our case, we owed $31,000 on my husband’s loan. Carmax offered us $21,000. So that left a $10,000 difference which was considered negative equity.

We were upside down on this loan by $10,000 and only had the vehicle for 7 months. Are you starting to see why vehicle loans are a bad investment?

Step 5 – Determine how to handle negative equity

There are a couple of options here.

Option 1: Aggressively pay off the negative equity on the car loan until what you owe on the loan matches what the dealership will give you for the car.

It will take you a little longer to reach your ultimate goal, but in the end that debt will be wiped completely.

Option 2: Take out a personal loan to cover the difference.

Credit union loan rates are typically better than going to one of the well-known regular banks.

We chose the latter option. Although it doesn’t wipe our debt completely, it does give us a good boost to slashing our six-figure debt.

Step 6 – Head to the bank if you chose option 2

If the car loan is financed by a bank that you have access to, it’s best to start there. Tell them what you hope to accomplish and see if they’re willing to work with you and give you a personal loan to cover the difference.

We bank with the same credit union that our cars were financed through so that part was easy going.

While we were talking to the bank rep about our plans, she happened to tell us about another dealership that could appraise our car. It was similar to Carmax in that they would buy the cars without requiring us to buy one of theirs.

Second Opinion

Did you know Enterprise Car Sales will buy your car? We didn’t either, but we headed over there that same day the rep enlightened us to see if their appraisal would offer us more.

If you remember from a little ways up, Carmax appraised my husband’s car at $21,000 and I couldn’t even get an offer from there on my car. When the bank rep told us about Enterprise, we decided to take BOTH cars there.

Enterprise appraised my husband’s truck at $24,000 and my car at $11,000. So that left us with a negative equity of $7,000 and $8,000 respectively.

So right off the top, Enterprise saved us $3,000 on my husband’s truck and $8,000 on my car. We had originally decided since Carmax wouldn’t buy my car, we would get my car fixed and keep mine while getting rid of my husband’s.

The down side to Enterprise is that their appraisal is only good for 3 days or 300 miles, whichever comes first.

Back to the bank – Apply for a personal loan

You’ve applied for a loan before, so you know the process for this – paperwork, references and financials.

Again, try a credit union because the rates are better. If no success, try Lending Club.

We were notified the next day that our loan was approved.

Step 7 – Buy a cash car fast 

Buying a car is the fun part right? Not when you have a 2 day deadline. We hadn’t really started looking for a car yet because we didn’t know what the outcomes were going to be. We just knew we wanted a car that was known for longevity.

I wanted to stick with the Toyota’s and Honda’s. My husband wanted his favorite car, the old school Mercury Grand Marquis or Lincoln Town Car. We found my husband’s car after a little trial and error and increasing our budget – a 1999 Lincoln Town Car with 130,000 miles on it, $3900

I hadn’t had much luck finding my car and after seeing how good my husband’s new car drove, I start desiring a Lincoln car too. As I researched the reliability of Lincoln’s, I found a YouTube video of a guy talking about how his Lincoln Town Car had over 400,000 miles on it – perfect fit for the longevity I was looking for.

I finally found a car I settled on – ironically I also found a 1999 Lincoln Town Car with 100,000 miles on it for $4,000.

Final Realizations

We ended up borrowing $6,000 from our 401K and put $1,900 of our own money to it. 

However, we don’t include this $6,000 in our total debt overview because essentially, we borrowed from ourselves. We both have pretty stable jobs and the money is coming out of our paychecks automatically before we even see our check.


  • We traded a $50,000 auto debt for a $15,000 personal loan – that’s $35,000 of debt released from our financial situation.
  • Our car insurance went from $190 to $65 – that’s a $1,500 savings per year. We actually got a check back from State Farm for $45.
  • Our personal property tax will decrease heavily – from $400 to less than $100 since the value of are 1999 vehicles are worth so little.
  • We can get an extra tank of gas each month with our previously set auto gas budget.

Would you be willing to sell your car to get out of debt faster?

out of debt

Hey there, I’m Ozella!
It’s my goal to create a community of moms who are ready to get out of debt, budget better and create their dream life without money standing in the way.

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Ozella is a millennial wife and mom on a journey to financial freedom. Having grown up financially dumb, she learned the hard way and is now working her way out of debt. She uses The Intentional Dollar to share all that she is learning with others through her own journey.

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