Selling recently acquired personal items in order to pay down debt?

Question

I was checking my credit cards statements the other day (I have 4), which they amount to ~$2000 USD, plus a car credit. Recently, my car credit bill went up due to my bank automatically renewing my car insurance (bill went up ~$70 USD month, so I pay ~$335 USD). Amounts are approximate as they are not billed in dollars.

Here's the thing, I make about ~$923 USD per month, and I wish to get rid of my credit card debt in order to have more control on my finances.

I was planning on selling of my video games. There's a store on my town that pays me in cash roughly half of their retail value.All in all, I would get about ~$300 USD if I sell them.

However, a lot of my debt is due to me buying (a lot) of video games on 18 months 0% interest plans. So, a lot of them have not been paid for.

Is this a good idea? I don't mind getting rid of them (since I don't have a lot of time to play anyway), but I don't know if the amount that I will be given is worth it.

Answer 1

I think you've run into the situation that economists call a "sunk cost". You paid for these video games. Whether you paid with cash or credit, the money is effectively gone. (Barring you defaulting on your debts, anyway.) So how you paid and how much you paid is irrelevant to any further discussion. Unless you invent a time machine, you can't go back and un-buy them.

Your choice now is: keep the games or sell them. The only relevant question is: Would the money that I get by selling them be worth more to me than the entertainment that I get by playing these games? If you really need the cash to pay off debts, and you are not playing these games very much, that sounds like you are better off to sell them.

Of course you want to get the best possible price when you sell.

RE is it legal to sell something that you sill owe money on: Sometimes when you borrow money to buy something, the lender gets a lien on the item. Like if you borrow money for a house or a car, the lender will have a lien on the house or car. Then if you fail to make the payments, they can seize the item and sell it to get their money back. In that case, you can't just sell the item and keep the money. Usually you are required to pay off the loan when you sell. The loan contract may have other specific provisions.

But if you buy with a credit card, this is an unsecured loan. You can freely sell the items bought and do whatever you want with the money.

I doubt anyone selling you a video game would have a separate loan contract with provisions for a lien. I guess it's possible, but very unlikely.

Answer 2

I would find it painful to have to sell something that I went into debt for at half of the price that I paid. I hope you find it painful as well, and that it makes an impression on your future use of debt.

Yes. Sell your video games even though you haven't paid for them. You might get a better price from a private buyer. Use the money from selling them to pay down the debt, then pay off the rest of the debt as aggressively as possible starting with the highest interest rate first (accounting for the 0% debts that you will pay back-interest on if you don't pay them during the introductory period).