“Isn’t it almost always a bad idea to trade in a car that you haven’t paid off?”
Not for the car dealer. Even before the economic crisis, dealers made very little profit on most new car sales... the gravy was from the used car side of the business...
I should have been more specific. I would also add that the dealer makes a killing when they add the payoff balance for the trade-in to the loan amount that the buyer takes out for the new vehicle purchase. I would imagine that brings in thousands of dollars in interest alone.
It is sad to see how people who do this often fail to realize they are now paying for 2 cars and only driving one of them.