Wow. That kind of payment schedule on a regular car is mind blowing. I havent had a car payment since 1994. I either pay cash or I dont buy it has been my motto. Of course interest rates on cars have gotten very low and even zero on some specials so maybe I could still sleep at night with that! But not for 97 months!
97 Month Auto Loan
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Originally Posted By: itguy08
Originally Posted By: racer12306
I'm honestly not sure if I would even buy a brand new car. Significant savings are to be had with a 1 year old vehicle with less than 20,000 miles. Almost new, pretty hard to cause significant damage to a car in 20,000 miles and someone else took that new car price hit.
I don't think that is the case any more. People/Dealers want crazy amounts for lightly used cars. Usually within $10k of list price of the same new model. With good negotiating skills, incentives, and lower finance rates the new car becomes mighty attractive, especially when the difference shrinks to less than $5000.
The "new car hit" only applies if/when you try to sell it. If you drive it into the ground it's of no worry to you.
Let's return to the topic: The advisability of 7 year auto loans. Not very advisable, but with a very low interest rate, probably not horrible in the way that a title loan is horrible or a sub-prime loan of any maturity is horrible.
Now on to topic drift. Yeah, you are right. Used car prices are too high right now. I can't think of a better time to buy a new car. You can get a good price on your clunker, finance the rest for 4% or less, and get a three year warranty. Even a VW is a reasonable bet with a 48 month or less note. Before the bust it was the opposite. Luxury car makers were furiiously signing people up to cheap leases on the expectation that they could sell the off-lease cars for good prices. The market was flooded, and in boom times nobody with any money would be caught dead driving a five year old luxury car. So an off-lease Jag XJ was maybe 17K. I got my 6 yr old BMW 7 series for 11.5K. (msrp list about 98K). Those days are gone.
Originally Posted By: racer12306
I'm honestly not sure if I would even buy a brand new car. Significant savings are to be had with a 1 year old vehicle with less than 20,000 miles. Almost new, pretty hard to cause significant damage to a car in 20,000 miles and someone else took that new car price hit.
I don't think that is the case any more. People/Dealers want crazy amounts for lightly used cars. Usually within $10k of list price of the same new model. With good negotiating skills, incentives, and lower finance rates the new car becomes mighty attractive, especially when the difference shrinks to less than $5000.
The "new car hit" only applies if/when you try to sell it. If you drive it into the ground it's of no worry to you.
Let's return to the topic: The advisability of 7 year auto loans. Not very advisable, but with a very low interest rate, probably not horrible in the way that a title loan is horrible or a sub-prime loan of any maturity is horrible.
Now on to topic drift. Yeah, you are right. Used car prices are too high right now. I can't think of a better time to buy a new car. You can get a good price on your clunker, finance the rest for 4% or less, and get a three year warranty. Even a VW is a reasonable bet with a 48 month or less note. Before the bust it was the opposite. Luxury car makers were furiiously signing people up to cheap leases on the expectation that they could sell the off-lease cars for good prices. The market was flooded, and in boom times nobody with any money would be caught dead driving a five year old luxury car. So an off-lease Jag XJ was maybe 17K. I got my 6 yr old BMW 7 series for 11.5K. (msrp list about 98K). Those days are gone.
Their is nothing wrong with financing a car, but finance what you can afford.
The person in the original article probably makes pretty decent money, say $50k a year. Their is no reason for the financial foolishness they displayed their.
They should have either kept their current car, or if forced to buy for whatever reason should have bought something cheap like say a Nissan Versa on the cheapest interest rate loan they could get, than pay it off in 24-36 months. Who cares if she doesn't like it? People forget that driving a car you like is a luxury, sometimes finances necessitate you drive a vehicle you hate but can afford.
Credit is a very useful tool, the problem is people abuse it to buy silly things they can't afford and don't put any thought into it. Only a fool would pay $36,000 for a $23,000 car, and you know what they say about a fool and their money...
The person in the original article probably makes pretty decent money, say $50k a year. Their is no reason for the financial foolishness they displayed their.
They should have either kept their current car, or if forced to buy for whatever reason should have bought something cheap like say a Nissan Versa on the cheapest interest rate loan they could get, than pay it off in 24-36 months. Who cares if she doesn't like it? People forget that driving a car you like is a luxury, sometimes finances necessitate you drive a vehicle you hate but can afford.
Credit is a very useful tool, the problem is people abuse it to buy silly things they can't afford and don't put any thought into it. Only a fool would pay $36,000 for a $23,000 car, and you know what they say about a fool and their money...
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Originally Posted By: Silverado12
I think it's a sign of the times. Nobody makes anything anymore. I'm just lucky I got into a good trade that pays well and so did my wife. I truly feel sorry for the folks in retail getting 8 bucks an hour with little to no chance of anything any better.
My thoughts exactly. What with pay pretty stagnant in many areas of the country, while cost of living keeps on marching, this type of financing is what I would expect to see.
I think it's a sign of the times. Nobody makes anything anymore. I'm just lucky I got into a good trade that pays well and so did my wife. I truly feel sorry for the folks in retail getting 8 bucks an hour with little to no chance of anything any better.
My thoughts exactly. What with pay pretty stagnant in many areas of the country, while cost of living keeps on marching, this type of financing is what I would expect to see.
commenting on the article, as a father of 3 devil toddlers, i fully understand why a new mother would want to purchase a new vehicle and completely disregard what the "smart" thing would have been to do. we did the same thing with our minivan and I do not regret it. I have my beaters to keep me busy, but our primary transportation is not something that can be gambled with.
Originally Posted By: jimmy87
Originally Posted By: dishdude
Even worse are people buying 3-4 year old used cars and financing for 5-6 years. You would be amazed the number of people that are driving 10 year old cars that have a lien on them.
my first truck back in 2009 was an 04 gmc, I got 9.25 apr for 66 months at $399 a month, paid off and maintained it just fine! Now I'm 25 and in 2011 I financed a brand new 2011 at 1.45 apr, I'm in the army and truth be told I'm ready to get out! A couple months ago somebody up in Dallas totaled my truck, it sucks, knowing that it would not be wise to leave the service with a $30k+ loan, I opted for a used truck once again, So now I have a 2009 gmc sierra I owe just over 15K and I got a 4.99 apr, it's a used vehicle. On my 2011 I was paying $399 a month for 72 months, not a bad deal for me especially since I had already proven to myself that I can handle that kind of financial responsibility.
You are the poster boy for the typical American. You're in the army (thanks for your service), buy a $30,000+ vehicle on army wages, a truck that you use to haul nothing, and you have a high monthly payment, and for too many years. You are not alone...most Americans are like that too. You and most of them need to buy small 4 banger cars to save $$ for their future, cheap reliable cars that you can pay off in 3-4 years, having cheap insurance, cheap maintenance.
We all need to act our WAGE!
The problem with fellow Americans is that they they are often lower or middle class but try to act like high earners. They buy too big, too powerful, too expensive, too unreliable, financed for too long at at too high interest rate, and you know why?
Reason: They will tell you that "I deserve it!".
Originally Posted By: dishdude
Even worse are people buying 3-4 year old used cars and financing for 5-6 years. You would be amazed the number of people that are driving 10 year old cars that have a lien on them.
my first truck back in 2009 was an 04 gmc, I got 9.25 apr for 66 months at $399 a month, paid off and maintained it just fine! Now I'm 25 and in 2011 I financed a brand new 2011 at 1.45 apr, I'm in the army and truth be told I'm ready to get out! A couple months ago somebody up in Dallas totaled my truck, it sucks, knowing that it would not be wise to leave the service with a $30k+ loan, I opted for a used truck once again, So now I have a 2009 gmc sierra I owe just over 15K and I got a 4.99 apr, it's a used vehicle. On my 2011 I was paying $399 a month for 72 months, not a bad deal for me especially since I had already proven to myself that I can handle that kind of financial responsibility.
You are the poster boy for the typical American. You're in the army (thanks for your service), buy a $30,000+ vehicle on army wages, a truck that you use to haul nothing, and you have a high monthly payment, and for too many years. You are not alone...most Americans are like that too. You and most of them need to buy small 4 banger cars to save $$ for their future, cheap reliable cars that you can pay off in 3-4 years, having cheap insurance, cheap maintenance.
We all need to act our WAGE!
The problem with fellow Americans is that they they are often lower or middle class but try to act like high earners. They buy too big, too powerful, too expensive, too unreliable, financed for too long at at too high interest rate, and you know why?
Reason: They will tell you that "I deserve it!".
Originally Posted By: tbm3fan
Originally Posted By: Silverado12
I think it's a sign of the times. Nobody makes anything anymore. I'm just lucky I got into a good trade that pays well and so did my wife. I truly feel sorry for the folks in retail getting 8 bucks an hour with little to no chance of anything any better.
My thoughts exactly. What with pay pretty stagnant in many areas of the country, while cost of living keeps on marching, this type of financing is what I would expect to see.
Why would you feel sorry for those folks? You and your wife are doing well and this is not because you are lucky. It's not because your good jobs were just given to you arbitraryly. You both are doing well because you did some planning and educated yourself in your past years.
The one's struggling today are often doing it because of very poor choices prior in life. This is not true for all of them but most of them. They often did it to themselves.
I'm doing great too, and like you and your wife, it is because I made enough good choices in my youth, so you see, it's not about perfection, nor is this rocket science.
Originally Posted By: Silverado12
I think it's a sign of the times. Nobody makes anything anymore. I'm just lucky I got into a good trade that pays well and so did my wife. I truly feel sorry for the folks in retail getting 8 bucks an hour with little to no chance of anything any better.
My thoughts exactly. What with pay pretty stagnant in many areas of the country, while cost of living keeps on marching, this type of financing is what I would expect to see.
Why would you feel sorry for those folks? You and your wife are doing well and this is not because you are lucky. It's not because your good jobs were just given to you arbitraryly. You both are doing well because you did some planning and educated yourself in your past years.
The one's struggling today are often doing it because of very poor choices prior in life. This is not true for all of them but most of them. They often did it to themselves.
I'm doing great too, and like you and your wife, it is because I made enough good choices in my youth, so you see, it's not about perfection, nor is this rocket science.
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The idea of taking a loan on a car that lasts longer than the warranty has always seemed excessively risky to me.
I'm also generally of the mindset of cash is kind and avoid debt of any kind. That being said, when I can get special financing (< 1%), I'll usually jump on it instead of pulling the cash out of savings or investments.
I still can't imagine going that long on a car loan -- I'm barely comfortable with the idea of a 5 year car loan.
I'm also generally of the mindset of cash is kind and avoid debt of any kind. That being said, when I can get special financing (< 1%), I'll usually jump on it instead of pulling the cash out of savings or investments.
I still can't imagine going that long on a car loan -- I'm barely comfortable with the idea of a 5 year car loan.
Originally Posted By: hattaresguy
Their is nothing wrong with financing a car, but finance what you can afford.
The person in the original article probably makes pretty decent money, say $50k a year. Their is no reason for the financial foolishness they displayed their.
They should have either kept their current car, or if forced to buy for whatever reason should have bought something cheap like say a Nissan Versa on the cheapest interest rate loan they could get, than pay it off in 24-36 months. Who cares if she doesn't like it? People forget that driving a car you like is a luxury, sometimes finances necessitate you drive a vehicle you hate but can afford.
Credit is a very useful tool, the problem is people abuse it to buy silly things they can't afford and don't put any thought into it. Only a fool would pay $36,000 for a $23,000 car, and you know what they say about a fool and their money...
Your post is excellent!
However, in today's world, $50 grand is not even half enough to have a good life, provide for a wife and few kids. Life and happiness start at $100,000 per year, if you want options for your family, opportunities for them, braces for the kids, house in a safe neighborhood, vacations, and not be a burden to extended family, friends, or society.
Their is nothing wrong with financing a car, but finance what you can afford.
The person in the original article probably makes pretty decent money, say $50k a year. Their is no reason for the financial foolishness they displayed their.
They should have either kept their current car, or if forced to buy for whatever reason should have bought something cheap like say a Nissan Versa on the cheapest interest rate loan they could get, than pay it off in 24-36 months. Who cares if she doesn't like it? People forget that driving a car you like is a luxury, sometimes finances necessitate you drive a vehicle you hate but can afford.
Credit is a very useful tool, the problem is people abuse it to buy silly things they can't afford and don't put any thought into it. Only a fool would pay $36,000 for a $23,000 car, and you know what they say about a fool and their money...
Your post is excellent!
However, in today's world, $50 grand is not even half enough to have a good life, provide for a wife and few kids. Life and happiness start at $100,000 per year, if you want options for your family, opportunities for them, braces for the kids, house in a safe neighborhood, vacations, and not be a burden to extended family, friends, or society.
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Originally Posted By: lovcom
Originally Posted By: hattaresguy
Their is nothing wrong with financing a car, but finance what you can afford.
The person in the original article probably makes pretty decent money, say $50k a year. Their is no reason for the financial foolishness they displayed their.
They should have either kept their current car, or if forced to buy for whatever reason should have bought something cheap like say a Nissan Versa on the cheapest interest rate loan they could get, than pay it off in 24-36 months. Who cares if she doesn't like it? People forget that driving a car you like is a luxury, sometimes finances necessitate you drive a vehicle you hate but can afford.
Credit is a very useful tool, the problem is people abuse it to buy silly things they can't afford and don't put any thought into it. Only a fool would pay $36,000 for a $23,000 car, and you know what they say about a fool and their money...
Your post is excellent!
However, in today's world, $50 grand is not even half enough to have a good life, provide for a wife and few kids. Life and happiness start at $100,000 per year, if you want options for your family, opportunities for them, braces for the kids, house in a safe neighborhood, vacations, and not be a burden to extended family, friends, or society.
Exactly. $50k in MD will not get you far at all.
Originally Posted By: hattaresguy
Their is nothing wrong with financing a car, but finance what you can afford.
The person in the original article probably makes pretty decent money, say $50k a year. Their is no reason for the financial foolishness they displayed their.
They should have either kept their current car, or if forced to buy for whatever reason should have bought something cheap like say a Nissan Versa on the cheapest interest rate loan they could get, than pay it off in 24-36 months. Who cares if she doesn't like it? People forget that driving a car you like is a luxury, sometimes finances necessitate you drive a vehicle you hate but can afford.
Credit is a very useful tool, the problem is people abuse it to buy silly things they can't afford and don't put any thought into it. Only a fool would pay $36,000 for a $23,000 car, and you know what they say about a fool and their money...
Your post is excellent!
However, in today's world, $50 grand is not even half enough to have a good life, provide for a wife and few kids. Life and happiness start at $100,000 per year, if you want options for your family, opportunities for them, braces for the kids, house in a safe neighborhood, vacations, and not be a burden to extended family, friends, or society.
Exactly. $50k in MD will not get you far at all.
Obligatory:
Originally Posted By: lovcom
Originally Posted By: hattaresguy
Their is nothing wrong with financing a car, but finance what you can afford.
The person in the original article probably makes pretty decent money, say $50k a year. Their is no reason for the financial foolishness they displayed their.
They should have either kept their current car, or if forced to buy for whatever reason should have bought something cheap like say a Nissan Versa on the cheapest interest rate loan they could get, than pay it off in 24-36 months. Who cares if she doesn't like it? People forget that driving a car you like is a luxury, sometimes finances necessitate you drive a vehicle you hate but can afford.
Credit is a very useful tool, the problem is people abuse it to buy silly things they can't afford and don't put any thought into it. Only a fool would pay $36,000 for a $23,000 car, and you know what they say about a fool and their money...
Your post is excellent!
However, in today's world, $50 grand is not even half enough to have a good life, provide for a wife and few kids. Life and happiness start at $100,000 per year, if you want options for your family, opportunities for them, braces for the kids, house in a safe neighborhood, vacations, and not be a burden to extended family, friends, or society.
I know people who do it with less.
I wouldn't want to only make $50k or $100k a year for that matter, that's really nothing. But I know a lot of people who make that and do just fine, its all about adjusting your lifestyle.
The problem is that a lot of people want to live like they make $200k-$300k a year.
For example the poster above who bought a new probably $40k truck on Army wages. No one who makes less than $150k should be buying a $40k truck, and I don't think they pay anyone in the Army that well. Heck one of my lawyers just got out as a Lt Colonial and he didn't make anywhere near that.
I see foolishness like that all the time though. My subs as soon as they start making some money which they are starting to do this year because the economy is picking up are all going to run out and buy loaded 3/4 crew cab trucks. I remember back in 2008 those guys where choking on those payments and feeding them at $4 a gallon. Now they will do it again.
Originally Posted By: hattaresguy
Their is nothing wrong with financing a car, but finance what you can afford.
The person in the original article probably makes pretty decent money, say $50k a year. Their is no reason for the financial foolishness they displayed their.
They should have either kept their current car, or if forced to buy for whatever reason should have bought something cheap like say a Nissan Versa on the cheapest interest rate loan they could get, than pay it off in 24-36 months. Who cares if she doesn't like it? People forget that driving a car you like is a luxury, sometimes finances necessitate you drive a vehicle you hate but can afford.
Credit is a very useful tool, the problem is people abuse it to buy silly things they can't afford and don't put any thought into it. Only a fool would pay $36,000 for a $23,000 car, and you know what they say about a fool and their money...
Your post is excellent!
However, in today's world, $50 grand is not even half enough to have a good life, provide for a wife and few kids. Life and happiness start at $100,000 per year, if you want options for your family, opportunities for them, braces for the kids, house in a safe neighborhood, vacations, and not be a burden to extended family, friends, or society.
I know people who do it with less.
I wouldn't want to only make $50k or $100k a year for that matter, that's really nothing. But I know a lot of people who make that and do just fine, its all about adjusting your lifestyle.
The problem is that a lot of people want to live like they make $200k-$300k a year.
For example the poster above who bought a new probably $40k truck on Army wages. No one who makes less than $150k should be buying a $40k truck, and I don't think they pay anyone in the Army that well. Heck one of my lawyers just got out as a Lt Colonial and he didn't make anywhere near that.
I see foolishness like that all the time though. My subs as soon as they start making some money which they are starting to do this year because the economy is picking up are all going to run out and buy loaded 3/4 crew cab trucks. I remember back in 2008 those guys where choking on those payments and feeding them at $4 a gallon. Now they will do it again.
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Originally Posted By: cptbarkey
commenting on the article, as a father of 3 devil toddlers, i fully understand why a new mother would want to purchase a new vehicle and completely disregard what the "smart" thing would have been to do. we did the same thing with our minivan and I do not regret it. I have my beaters to keep me busy, but our primary transportation is not something that can be gambled with.
Finally a comment that actually takes into consideration the person's situation. We are currently eyeing the 2014 Odyssey, as our Mountaineer is getting long in the tooth and our main concern is having a vehicle that will give us the fewest problems. I can easily keep the truck going with repairs and maintenance, but my wife drives it and she's clueless if it were to give her any problems.
We will most likely finance for 5 years and I'll make a payment above the minimum that I'm comfortable with, and we'll have 50% down payment. At 0.9%, why shouldn't I use someone else's money?
commenting on the article, as a father of 3 devil toddlers, i fully understand why a new mother would want to purchase a new vehicle and completely disregard what the "smart" thing would have been to do. we did the same thing with our minivan and I do not regret it. I have my beaters to keep me busy, but our primary transportation is not something that can be gambled with.
Finally a comment that actually takes into consideration the person's situation. We are currently eyeing the 2014 Odyssey, as our Mountaineer is getting long in the tooth and our main concern is having a vehicle that will give us the fewest problems. I can easily keep the truck going with repairs and maintenance, but my wife drives it and she's clueless if it were to give her any problems.
We will most likely finance for 5 years and I'll make a payment above the minimum that I'm comfortable with, and we'll have 50% down payment. At 0.9%, why shouldn't I use someone else's money?
I would use someone elses money also. Anytime the rates are below 5% then money is cheap. When it is below 2% it is practically free. All that said why would you buy an Odyssey? sorry couldn't resist.
OT: But, if you like Chryslers, I suggest taking a look at the Town and Country.
Originally Posted By: Barkleymut
I would use someone elses money also. Anytime the rates are below 5% then money is cheap. When it is below 2% it is practically free. All that said why would you buy an Odyssey? sorry couldn't resist.
So, where do you guys invest this $20,000 +/- while you take out a 1.9% new car loan that is nearly risk free and makes enough more than 1.9% to make it worth the hassle?
Imagine buying a new car in 2007, parking that money somewhere, then get hit by the 2008 ball buster. For the next 4 years +/- that investment would have been flat, or worse.
This question would be for the average Joe who could not afford the risk of loss.
I would use someone elses money also. Anytime the rates are below 5% then money is cheap. When it is below 2% it is practically free. All that said why would you buy an Odyssey? sorry couldn't resist.
So, where do you guys invest this $20,000 +/- while you take out a 1.9% new car loan that is nearly risk free and makes enough more than 1.9% to make it worth the hassle?
Imagine buying a new car in 2007, parking that money somewhere, then get hit by the 2008 ball buster. For the next 4 years +/- that investment would have been flat, or worse.
This question would be for the average Joe who could not afford the risk of loss.
Originally Posted By: threeputtpar
Finally a comment that actually takes into consideration the person's situation. We are currently eyeing the 2014 Odyssey, as our Mountaineer is getting long in the tooth and our main concern is having a vehicle that will give us the fewest problems.
Out of curiosity how many miles does a Mountaineer have to make it "long in the tooth"?
Finally a comment that actually takes into consideration the person's situation. We are currently eyeing the 2014 Odyssey, as our Mountaineer is getting long in the tooth and our main concern is having a vehicle that will give us the fewest problems.
Out of curiosity how many miles does a Mountaineer have to make it "long in the tooth"?
Originally Posted By: grampi
I don't understand anyone buying a new car these days...some of these vehicles cost as much as a small house...vehicle prices are out of control...$20K+ for compacts and prices only go up from there...ridiculous!
The only vehicles that cost as much as a small house in my neck of the woods are Bentleys, Ferraris, etc.
I don't understand anyone buying a new car these days...some of these vehicles cost as much as a small house...vehicle prices are out of control...$20K+ for compacts and prices only go up from there...ridiculous!
The only vehicles that cost as much as a small house in my neck of the woods are Bentleys, Ferraris, etc.
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