Tips on Buying Cars: Complicated Situation, subaru forester, negative equity

Question
Hello, I'm having a hard time deciding what to do in my situation. I am recently married, my husband owns a 2006 f-150 with 131K and owes 15,000. Blue book is 14,445 private party and 11,025 trade in. He is now commuting 180 miles per day to work 6 days a week so he has been driving my 2005 Subaru Forester to save on gas. I should also mention he has horrible credit (score of 595) I have great credit but am not working so have no income to consider.  We are expecting a baby and can't afford our 2 car payments of 350$ each car but I don't want that many miles on my Subaru. I want to get rid of his truck and get him a reliable gas efficient car. We can afford about 7,000$ out of pocket and realize that part of that will go towards negative equity. I am trying to decide whether it would be smarter to trade it in on an older cheaper used car (around 5,000$) and try and pay cash for the new car or bite the bullet realizing that we are going to eat it on this transaction and get a newer lower miles car that will presumably last longer (hoping that a larger down payment will make the payments on the new car more affordable) What would you do in my situation?  I hope this wasn't too confusing and would appreciate any input. I live in zip code 89027 but am about 80 miles from Las Vegas so would probably shop there if prices are better.  Thank you again!

Answer
Hi Nicole,
With distance and cost of gas I fully understand using the Subaru. I could take the easy way out by simply saying " yes bite the bullet " but you asked what I would do in your situation, and that needs a few more answers from your end.

1,,, Is the f-150 a crew cab - single or extended,,, better still, go autotrader.com find the same model and year and send me a link.
2,,, what is the lien pay out on the Subaru, phone the lender to get an exact amount.
3,,, Am I right to understand your total monthly payments for both vehicle's are $700. combined, split at approx $350.
4,,, What are the interest rates ?,,, I also assume Subaru title in your name only and Truck in your husband's name only ?
5,,, You have approx $7000. in savings that can be invested towards a solution ?

The answer would have been an easy one, by that I mean had your credit been blemished and not your husband's, a huge factor will be the new interest rate.
Nicole,,, if you reply,,, make sure you check the make private box.
Ray
http://www.usedcartips.org/