Should i pay my car off or use the money for down payment on new car?

I owe 2000 and the KBB value is 4400 for trade in. I have 4000 saved up and I am wondering if cash down payment says more than a car to trade in?Should i pay my car off or use the money for down payment on new car?
Paying off the car before trading it in or putting $2K down when you trade it in will acheive the same result.

Whether you should roll the 2000 into the new loan will depend on your loan interest rate.

If your new rate is lower, you may as well save your $2K and use your equity as the down payment.



If your new loan rate is higher, then put as much down as you possibly can to avoid future interest.Should i pay my car off or use the money for down payment on new car?
Use the money for a down payment! If KBB says your trade in value is $4400 you will most likely be offered $3000. Dealers will reduce the amount of trade to offset any price negotiation of the new car. Good Luck

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