Tips on Buying Cars: ===trade-in, value of my car, blemished credit

Question
i have a 2001 ford focus, that i bought in Nov 2004, the tag price was $10,000.00, and they give me a 16.00% interest because of my poor credit,im paying $300.00 a month, the sales person told me i could trade-in me car after 6 months from the purchase. its been more than 2 years and i still owe $7000.00 on that car, and its been at the shop constently, right at this moment my car is broke from the engine, its been at the shop for a month, luckly my car is still under warranty, but the warranty is about to expire, my question is, if is a good idea to trade-in my car?,i look for the value of my car in the bluebook and is in between $3000.00 - $4000.00, im planning to trade it in for a Toyota RA4 2006.i have $2,500.00 to put down. im hoping to get a good deal and a better interest rate since i have never been late on my focus and my credit score its a litter better. i would appreciate if you can give me an advice on making this step, im really bad on negotiating, can you please give me advice on getting a good deal, how to get a better interest rate, and negotiate the price of the car and the value of my focus.                          thanks

                                     Ivan

Answer
Hi Ivan
You been a victim of the # 1 dealer scam buying a car with a blemished credit rating, through this site and yahoo I have answered this same type question so many times in the past with long detailed information that I finally made a website with all the answers. Go to   http://www.usedcartips.org/CREDI.html   and scroll down to The Trade In - Scam, its a carbon copy of what happened to you.
The good news in your mail is the $ 2500. down which should hopefully leave you close to not being to far upside down, You must shop the interest rate before buying, credit unions - banks, to be very blunt and to the point I would not buy a Toyota 2006 if my interest rate is above average ( You will be in twice the size hole down the road compared to now )  
Study and follow the 10 steps on the website and you will not get bitten twice. If you have problems understanding the negotiation process feel free to get back to me for a more detailed explanation
Have a great day
  Ray