I Have $1,800 In Car Payments At 18% interest

Summary

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Podcast Summary: The Ramsey Show Highlights

Episode: I Have $1,800 In Car Payments At 18% Interest
Date: October 15, 2025
Host: Ramsey Network
Guests/Experts: Rachel Cruze (A), Dr. John Delony (C)
Caller: Sarah (B)
Episode Length: ~10 minutes

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Episode Overview

This episode centers around a call from Sarah, who—with her fiancé—finds themselves financially overwhelmed by massive car payments at high interest rates. Together, they face $1,800/month in car payments while being upside down on both vehicles. The hosts break down their situation, offer tough-love advice, and outline drastic but actionable steps to escape the debt spiral. The tone is empathetic but urgent, with encouragement to overhaul their spending and embrace uncomfortable but necessary changes.

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Key Discussion Points & Insights

1. Caller Situation Breakdown

• Combined Car Payments: $1,800/month at 18% interest
• Vehicles:
  • 2015 Ford F150 (owes $20,000, payment $700/month)
  • 2021 GMC Acadia (owes $32,000, payment now $1,100/month after falling behind)
• Income:
  • Sarah: $55,000/year
  • Fiancé: $52,000–$53,000/year
  • Take-home pay: About $8,000/month combined
• Other Expenses:
  • Rent: $2,000/month
  • Daycare: $700/month
  • No savings; credit cards are maxed or unpaid

Memorable Exchange

• (00:21) Sarah: “Yeah, I know. It's stupid. I know.”
• (00:23) Rachel Cruze: “Are you driving Lamborghinis? What do you drive? I'm curious.”

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2. Vehicle Value and Negative Equity

• Estimated Values:
  • Acadia: $17,000 (dealer offer); could get ~$20,000 private sale
  • F150: Believed to be only $8,000, but hosts strongly disagree; likely worth more, especially in Texas.

Notable Quote

• (02:21) Dr. John Delony: “From an F150. Did he wreck it?... F150s are made of gold.”
• (03:09) Dr. John Delony: “I haven't seen a truck worth $8,000 in a long, long, long time.”

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3. Core Problem: Lifestyle vs. Income

• Overspending on Cars:
  • The car payment for Sarah alone is about half her gross income.
  • Car values are well below loan balances (deeply underwater).
• Budget Realities:
  • Rent is proportionate to income, but total outflows are unsustainable.
  • No savings, poor credit, unpaid credit cards.

Key Insight

• (03:59) Rachel Cruze: “…getting rid of this car is huge because it's more than half of your annual take home pay…we have way, way too much car, which I know, that's why you're calling, because you're feeling it.”

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4. Immediate Recommendations

• Sell Both Cars: Offload both vehicles, even at a loss.
• Use Personal (Not Auto) Loans:
  • Suggested seeking a $25k personal loan (not a refinance) to pay off the negative equity on Sarah’s car, then buying a “$5,000 crappy car for just the time being.”
  • Similar process for her fiancé, likely needing a smaller loan if truck value is higher.
• Prepare for Discomfort:
  • Hosts emphasize that there’s no quick fix and the next 2-3 years will require serious sacrifice, including possible second jobs and drastically cutting lifestyle expenses.

Notable Quotes

• (06:21) Dr. John Delony: “It's not a refi. We're paying this thing off. We're done with it.”
• (07:08) Dr. John Delony: “...you have to metabolize to truly get out of this mess. It's going to be 36 months of not a lot of fun.”
• (07:56) Rachel Cruze: “There has to be an extreme change … it’s got to be a completely different shift.”

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5. Financial Peace Mindset & Tools

• Lifestyle Shift Required:
  • Stop all non-essential spending: no eating out, no shopping, no vacations, consider moving to a cheaper apartment.
• Intense Budgeting:
  • Use the EveryDollar app and follow Financial Peace University steps.
  • Hosts gift Sarah a subscription to EveryDollar for a year to help tackle budgeting.

Memorable Moment

• (08:39) Dr. John Delony: “We're not decorating anything.”
• (08:41) Rachel Cruze: “We're not doing anything. But we're literally putting every single penny we can find to this debt…”
• (08:56) Rachel Cruze: “…[EveryDollar] is going to look over your entire financial picture, and people are finding thousands of dollars of margin in just 15 minutes.”

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Notable Quotes & Timestamps

• (00:23) Rachel Cruze: “Are you driving Lamborghinis? What do you drive? I'm curious.”
• (02:21) Dr. John Delony: “From an F150. Did he wreck it?... F150s are made of gold.”
• (03:59) Rachel Cruze: “...getting rid of this car is huge because it's more than half of your annual take home pay...”
• (06:21) Dr. John Delony: “It's not a refi. We're paying this thing off. We're done with it.”
• (07:08) Dr. John Delony: “...you have to metabolize to truly get out of this mess. It's going to be 36 months of not a lot of fun.”
• (07:56) Rachel Cruze: “There has to be an extreme change...it’s got to be a complete different shift.”
• (08:39) Dr. John Delony: “We're not decorating anything.”

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Key Takeaways

• Face Reality: Own mistakes honestly and accept tough sacrifices.
• Sell Cars, Accept Loss: Trade expensive, high-interest loans for manageable, short-term debt paired with very cheap cars.
• Slash Expenses: Ruthlessly cut all unnecessary spending, take extra work if possible.
• Budget Relentlessly: Use EveryDollar and Financial Peace University to plan every dollar.
• Prepare for a Grind: True change will hurt for 2–3 years but is possible with teamwork and determination.

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Segment Guide

• 00:08–01:41: Sarah explains situation (car payments, loans, income breakdown)
• 01:47–03:29: Discussing car values, negative equity, and vehicle specifics
• 03:59–04:11: Realization of being “way too much car” relative to income
• 04:14–05:24: Outlining credit issues, rent, take-home pay, and reality check
• 05:54–07:08: Loan advice: personal loans vs. refinancing, aggressive sell-off plan
• 07:08–08:41: Mindset shift, true path out requires “burn it to the ground” changes
• 08:41–End: Strong push for intense budgeting, gift of EveryDollar subscription

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Final Message

The hosts’ message is clear: There’s hope, but it will require radical changes, humility, and relentless budgeting discipline. Real financial peace is possible—just not with $1,800 in car payments.

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Transcript

[A]

Brought to you by the EveryDollar app. Start budgeting for free today.

[B]

Me and my fiance, we're in a bind. So we both have car payments and we're both upside down. So combined, our car payments are about eighteen hundred dollars a month.

[C]

Golly.

[B]

Yeah, I know. It's stupid. I know.

[C]

Are you driving Lamborghinis? What do you drive? I'm curious.

[B]

Basic, you know, a GMC Acadia and an F150. And the F150 is a 2015, and the Acadia is a 2021. Terrible interest rates.

[C]

Did you get these at like a sub. I mean, did you. I mean, did you buy them off a lot? It's like a handshake deal. Off a lot somewhere behind the lot.

[B]

Car dealership. It was just. The credit was so bad, so he had his truck before I got my car. My other car that was paid off. I loved it. It was just down in the dirt and the engine was smoking when I pulled into the dealership.

[A]

Okay, Sarah. What? I want you to separate these out. Tell me your car. How much? How much is it worth?

[B]

Yeah, my. Oh, I owe 32 on it still.

[A]

Okay.

[B]

My payment is 1100 because we got behind, so we had to do this promise to pay thing. It was 8:15, but now it's bumped up to 1100. Okay, 2015. F150. He still owes 20,000 on it, and his payment is right at 700.

[C]

How much do you make a year?

[B]

So combined.

[A]

No, don't combine it.

[B]

Me, myself, right around 55.

[A]

Okay. How about him?

[B]

He's about 52, 53.

[A]

Okay. What could you sell your car for today? What does Kelly Blue Book say?

[B]

I think it's like 17.

[A]

Have you looked?

[B]

I have.

[A]

Okay. And an individual, not dealer.

[B]

So not as an individual, I haven't.

[A]

Okay, So I would do that. So I would give it a couple thousand more because you can usually get more from an individual. A dealer is going to buy it as close to wholesale as possible. So what did you. What was the first. What's the number you said for the dealership?

[B]

17.

[A]

Okay, let's just bump up to 20 just for fun. Okay. How much could he sell his for?

[B]

I think his is valued at like.

[A]

8 from a dealer.

[C]

From an F150. Did he wreck it?

[B]

No, he did not wreck it.

[C]

It's just F150s are made of gold.

[B]

So both of our cards have about a hundred thousand miles. His is about still, though.

[C]

No, that's not. I. I almost guarantee you a 2015.

[A]

I'm gonna yeah, 12 to 15,000. Or you think even more. They're expensive.

[C]

I buy, I like trucks. And they're so like, they're, it's like cartoon money.

[B]

No, no, dude, I thought that's what it.

[A]

That.

[B]

So it's also a two wheel drive.

[C]

I mean there's going to be a bunch of nuances here and there, knickknacks, and we have to go back and forth. If it's extended cab or like a single, like all that stuff. I could almost guarantee you, I could be wrong, that it's worth more than eight grand. Unless it's been wrecked. It was, it was underwater.

[B]

I will look into that.

[A]

Yes.

[C]

And private party too.

[A]

Yep.

[B]

Okay.

[C]

Even if there was somebody that owns a lawn crew that will roll up and give you ten grand cash for it. Like it's. I, I haven't seen a truck worth $8,000 in a long, long, long time.

[B]

Okay.

[A]

So yeah, we'll be a little bit more in. You're in Texas, you know, they like, they like their job.

[C]

They give you a truck with your birth certificate.

[B]

Yeah, I haven't dug too much into him.

[A]

Okay, so. Sarah. Golly. Okay, so, man. Okay, so for you and I'm gonna talk, I'm gonna, I'm gonna separate the two because you guys aren't married yet. Once you're married, we combine it all together and I'm right off into the winds. But for you specifically, yes, getting rid of this car is huge because it's more than half of your annual take home pay. You know what I mean? Or half of what you make. And so you are. We have way, way too much car, which I know that's why you're calling, because you're feeling it.

[B]

Yeah, we both are. So all of our finances are combined. We have four kids together.

[A]

Okay, okay, hang on the line.

[C]

We're going to hold you over because I want to unpack this one.

[A]

Yeah, and we'll, we'll walk through some of this math.

[C]

We're going to go to a break, but we'll be right back.

[A]

All right, welcome back. We have Sarah on the line from the last segment. She was calling in because their car payments and car loans, they are feeling it. So she owes 32, 000 on hers with 1100 dollars going out every month in a payment. And her husband owes 20, 000 or I'm sorry, her fiance owes 20, 000 on his. He makes 52, she makes 55. And just kind of trying to figure out the math here to get them out of These payments. Does that sound right, Sarah? So far, yes. Okay. Um, and are both of your credits shot? Because you mentioned that?

[B]

Yep.

[A]

Okay.

[B]

They are. Yeah. So we have completely stopped paying on the credit cards because even the minimums is like, okay, well, we're not going to pay our rent. So we rent right now for 2,000, then daycare, 700. It's everywhere.

[A]

Okay, your rent is 2,000. How much do you guys. I mean, you're running your household as if you're married, so I'm going to ask this. How much do you. How much?

[B]

They pretty much do. How much.

[A]

How much hits your checking account every month after taxes, after insurance, everything.

[B]

I would say. Right, about 8,000.

[A]

8,000 for both of you?

[B]

Yes.

[A]

Okay. Okay. Well, that's. Yeah. Then the. The $2,000 rent, that's in line with it for being about a fourth of your take home pay. Because that's what we're wanting shooting for. So that's not completely out of control. But then again, you add on these car payments and everything else on top of it. It's a. Guys, have you guys gone down to maybe a local credit union or a local bank and talk through a loan process? Because the ideal situation, again, your credit shot. So it may not work.

[B]

They will not refinance.

[A]

But no, no, not a refinance. Just to get a. Get a personal loan. And I would get a $25,000 loan for you and pay off the difference. Pay off the difference of 20. Go get a $5,000 crappy car for just the time being. And your husband, you know, do the same if he's able to. Because I mean, I mean, honestly, what John was saying about trucks, I mean, I'm praying he can get more, but he may only need like a $6,000 loan to get it paid off to get the difference if he can sell it.

[C]

And it's not a refi. It's just we're paying this thing off. We're done with it.

[A]

Yeah, yeah, yeah, yeah. It's a com. But I would rather have a $20,000 loan than a $32,000. Right. So we're just kind of moving it but lowering it at the same time. Which means you're getting rid of these cars and driving crappy cars. Do you guys have any? You don't have anything in savings?

[B]

No, nothing. So we just started yalls financial piece last week through our church.

[A]

Oh, good. Okay.

[B]

All the steps are hitting us and we're like, oh, yeah, well, yeah, the.

[C]

Thing I think you have to metabolize here Is this is. You've got these car payments. You'll have done things that aren't wise with money. We all have. You all have to metabolize to truly get out of this mess. It's going to be 36 months of not a lot of fun.

[B]

Yeah.

[C]

And if you're willing to do that, you can get out of this. And that might mean you're taking a second job. He's taking a second job. And you're like, I don't have time to that. And I would tell you don't have time not to because I can hear you drowning. And you're going to find yourself. This car is going to fail you before you pay it off. And you have to roll that.

[B]

It has been in the shop.

[C]

That's right.

[B]

Already.

[C]

You have to roll the negative equity and you're going to end up on $50,000 on a. On a 79 used, like, whatever, Volvo. Right. So it's like at some point, you and him have to say, we're drawing a line here. We're not going to go out to eat. We're going to take second jobs. We're going to maybe move apartments. That's $1,500 instead of 2,000. We're going to do that for three years or two years so we can get out of this once and for all. And if you don't have that level of burn it to the ground and grow something beautiful out of the ashes. If you don't have that, you're just going to keep playing a shell game.

[A]

Yep, that's right. Yeah. There has to be an extreme change. I mean, it's almost a 180 at the way you guys have been thinking about money, doing money. I mean, all of it. It's. It's got to be a complete different shift. And you guys are in financial Peace University, which I'm so thankful for. But we're also. If you hold on the line, Kelly's going to pick up and we're going to give you our all new every dollar. And we're excited about this because within the app, you're not only able to budget and create a monthly budget, which will be so great for you, Sarah, and to sit down for you guys to look and be like, hey, we are literally, this is our plan for what we're spending on groceries, lights, rent, gas for the car, and that's it. Daycare and insurance and like, we're paying for nothing else. We're not Amazoning. We're not going to Target. We're not going on vacation.

[C]

We're not decorating anything.

[A]

Oh, that looks nice.

[C]

Doesn't matter.

[A]

We're not doing anything. But we're literally putting every single penny we can find to this debt. And when you start to have that motivation, it's incredible. And to have an app like EveryDollar that not only can you do the budget, but also it's going to look over your entire financial plan. Because with EveryDollar, we're adding in so many coaching elements, and it's going to look over your entire financial picture, and people are finding thousands of dollars of margin in just 15 minutes. So for all of you listening, we have a premiere coming about the All New EveryDollar on September 25th, where you get to see real success stories and how you could be the next one and how you can plug into this and start your money journey. So if you want to turn on your YouTube notifications to get notified when the premiere drops, make sure to do that. And again, that is going to be September 25th is where the allnew Every Dollar premiere is here for you guys, and we're really, really excited about it. So Sarah, again, Kelly's going to pick up, and we will hook you up for a year's worth of that EveryDollar subscription to get you guys in and moving. So we are cheering y' all on. Create your free everydollar budget today. The simplest way to budget for your life.