Marine Battles to Keep Up With His Car Loan

Dear Driving for Dollars, I am a 22-year-old Marine with a $630 monthly car payment and $275 a month in car insurance. I have owned my car for two years, and I'm just barely making the car payments and the insurance. I get out of the Marines in about six months, and my expenses will increase. Should I keep the car and stick it out, refinance, or trade it in for something cheaper? -- Pride-Filled, Bad Decision-Making Marine

Dear Pride-Filled, First, thank you for your dedication to serving our country. Because you bought this vehicle when you were 20, you probably got stuck with a high interest rate on your car loan. This was most likely because of a lack of credit, which boosted your monthly car payment. Assuming you have made your car payments on time and don't have any credit issues, you are probably a good candidate for refinancing your car loan.

Even so, you may want to consider selling your current car for something cheaper to help you get off to a good start in your new role as a civilian.

Start by using several car-pricing websites to determine what your car is worth. If you are like many military personnel in that your car is sitting more than it is driving, you'll likely be able to get top dollar due to its low mileage and better-than-average condition. That will work in your favor.

To get the most money, sell it privately. Once your car has been sold, start looking for a replacement that is cheaper. Aim for no more than 25% of your monthly income, including the car loan, insurance, gas and maintenance. Follow Bankrate's tips on buying a car in 2012 to ensure you get a good deal.

Don't forget to check on special rebates or low-interest financing for military personnel, which may help you get a much better interest rate on your car loan than you were given on your current car.

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If you have a car question, email it to us at Driving for Dollars. Read more Driving for Dollars columns and Bankrate auto stories. Follow her on Facebook here or on Twitter @SheDrives.

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