Did you recently take on (or consider) a loan of 84 months or longer on a car purchase?
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I wouldn't, gas has cleaning agents added to it to keep the system clean. I have driven cars up to 200k+ miles without cleaning the injectors nor using an additive with no problems.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
A belt at 35k? Yeah that's normal service life -- in a Rover. On normal cars, belts don't break anymore; any serpentine should go 100k, and if you want to be extra sure, change at 70k.
As far as being right-side up after 1.5 years on a private sale, forget it unless you put massive $$ down. The books don't work, and they always always overvalue high-milers. Hold on to it, and get chummy with a good tranny shop while you're at it.
Seriously, find a good independent mechanic you can trust, maintain your car properly, and pay it off.
Good luck,
-Mathias
and thanks for confirming my belt suspicion. All I can remember is that, in the last car I had that went that long, I changed the accessory belt along with the timing belt at 75k miles.
'11 GMC Sierra 1500; '98 Alfa 156 2.0TS; '08 Maser QP; '67 Coronet R/T; '13 Fiat 500c; '20 S90 T6; '22 MB Sprinter 2500 4x4 diesel; '97 Suzuki R Wagon; '96 Opel Astra; '11 Mini Cooper S
Come on now it is not like the dealership has their A1 tech doing 35,000 mile services. He is just going by what the service interval chart recomends. The guy doing the service probably just moved up from oil change man last week.
but, anyway, he may only be doing what he's told (the tech), but its definitely not recommended by the manufacturer. This is a dealership service department trying hard to pad their bottom line.
'11 GMC Sierra 1500; '98 Alfa 156 2.0TS; '08 Maser QP; '67 Coronet R/T; '13 Fiat 500c; '20 S90 T6; '22 MB Sprinter 2500 4x4 diesel; '97 Suzuki R Wagon; '96 Opel Astra; '11 Mini Cooper S
What are the pros and cons of paying cash? And what kind of cash payment method is wisest? My dad had the idea of using a credit card if the dealer allowed that, with the intention of paying the credit card bill immediately while gaining the advantage of earning points on the card. Does that sound like a good idea?
My father has no debt and an impeccable credit history, and I guess it's no wonder that he now has the cash to buy a new car and wants to do it without incurring debt. But besides serving as an admirable example of fiscal responsibility, how can we maximize this advantage when it comes to paying for his new car?
Most dealers will not take more then 2000 dollars on a Credit card either because the CC company back charges them a few percent of the transaction price.
Have you ever taken in an all cash (hard cash, all yankee greenbacks, not a check, draft or anything like that) for a Rover? I can think of a couple of reasons that any company might be weary of taking in to much cash for a large purchase.
So if I came in with 6 million pennies would you take them as payment for a Rover?
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
They traded in their old Range Rover that was worth about 19,000 dollars they owed about the same on it so just saved the tax. Put 2,000 dollars on the AMEX card twice. Once when the deal was closed and once at delivery. Brought in 15,000 dollars in real cash and 30,000 dollars in a cashiers check. They took out a 3 year loan for the ballance and I think the payments were 1,300 dollars or so a month.
This was a loaded Range Rover by the way so MSRP was about 85,000 I think and we sold it for 83,000 or so.
we had a couple on tuesday night that paid cash money for a new miata....27K in $20, $50 and $hundreds. All in a plain brown shopping bag. 4 of us counted it in a locked office.
OTOH I lost a $500 bet with somebody a couple years ago and I paid it in change....he was less than impressed but I felt good about it. :P
Last car purchase (in mid-April), I test drove on one day, then test-drove some competing cars, came back to the first one a couple days later with checkbook in hand. Wrote a check for half the price, said I would finance the rest with my credit union.
They let me drive away in the car after signing a promise that I would get financing in three days. Prior to letting me do that, they ran a credit check on me, and looked at my credit union's site on-line, saw that the C.U.'s finance rates were better than they could do, so they didn't even try to beat it. They were perfectly happy to take my personal check.
One advantage of knowing that you'll be paying cash is that you won't get lost in montly payment hocus-pocus. Makes it much easier to discuss only the total price of the car, not something like "for only $10 a month more you can do...blah, blah, blah."
Also it makes it easier to stick to a budget. If you have xxx amount in your car-buying savings account, then that's your budget parameter; you're a lot less likely to go shopping for something that is xxx-plus $10,000, or whatever.
And if you're like me, it's at least somewhat painful to part with all that, so thinking about leaving a couple thousand still in the account as seed money for your next car can be a motiving factor to keep bargaining until you hit what you think is the lowest possible price.
I was thinking out loud, I guess, wondering if there was any way we could leverage our good credit and willingness to pay cash to gain additional benefits. For example, hypothetically, if we could pay by credit card which we would then pay off immediately, the dealer would get his price, we'd get the car for cash without incurring debt - and we'd also earn enough points on the card to get an airline ticket.
I saw an interesting idea in one of these threads which I'm going to look for again to read more carefully. Someone suggested to a buyer that he should finance the car to be eligible for a rebate that was running at that time for customers who financed - and then pay off the entire amount a couple of months later. That's the kind of "creative thinking" I wish I had
Nothing wrong with doing that. Typically dealers might offer either a very low rate for financing OR a cash rebate. My C.U. offers a little chart where you can compare and see if you're better off with the cash rebate or with the low-rate for financing. I think AAA has such a chart too, or you might be able to find it on-line someplace. It compares the rate and the number of months financed vs. the rebate for paying cash. Sometimes it actually does come out better to finance.
Yes, I just skimmed it quickly but it did seem quite clever. Thanks for the tips, I am going to look into this some more.
I'll check AAA's website for a start. Financing, rate comparisons, APR, sheesh, now I'm starting to regret snoozing through all those math classes.
Using a credit card.
Using a Personal check.
Using a Certified check.
Paying "cash" is just that... paying in currency ONLY.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
They are not considered as "cash" cash is currency and only currency.
A personal check is a check.
A certified check is a check.
So if what you are saying is fact that means auto dealers get paid by "cash" if you finance or not (either way they get a check)
They are considered cash equivalents and therefore considered cash. A check can be signed over to anyone and even be converted to a bearer bond (meaning that anyone that has it can cash it). They are considered part of the cash supply.
So if what you are saying is fact that means auto dealers get paid by "cash" if you finance or not (either way they get a check)
while they do get cash they do not get your cash. They are getting someone elses cash and that someone else is getting your commitment to pay back. Seeing that there is a third party involved its not a cash sale but rather a credit sale.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
I don't know, but I wonder if the dealer would accept a credit card if you agreed to pay the transaction percentage? Another thought, if he ever gets those checks to use against his credit card (and they waive the transaction fee, or it is capped at maybe $60 as I think mine was) that might be an option.
I know it applies to all financial institutions but I couldn't say for anything else.
I don't know, but I wonder if the dealer would accept a credit card if you agreed to pay the transaction percentage?
I would be surprised if they would. Part of the merchants agreement is that they do not charge more for a product if one pays with a credit card. So doing so would be a violation of their merchant agreement and they could lose their ability to accept credit cards. Of course there is nothing about giving discounts for cash.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
I was wondering if people here could help me out. This might come off as a dumb question, but the idea just popped into my head. Is it possible to finance a car for say 4-5 years, and "sell" the car to another buy after 3?
The idea came up when I was considering leasing and realized that I might just try to get a loan, make the payments for as long as I want, and then sell the car to another buyer before the loan end. Sort of like a compromise between leasing and financing.
But, you can also sell (or trade in) a car in the middle of a lease. It might cost a bundle, since you have to pay the remianing payments and the residual, but it is done quite often.
2020 Acura RDX tech SH-AWD, 2023 Maverick hybrid Lariat luxury package.
Really? I always thought a check comes with a paper trail, and, therefore, no reporting is required.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
August of 2005. It was used with 45k miles already on it.
I bought it at $16.5k not including tax and the rest. Being a newbie buyer, without much research this is what I got.
My monthly payments ended up to be $389.54 with an APR of 10.60%.
Been paying roughly $400 a month.
To pay it off today would cost me $18,353.90
A few weeks from now and I will have owned this car for One year. Within that year I have only put 4k miles on it.
Now I finally understand how much of a rip off I got on this car. And these payments are tearing me apart. I really would like to try and lower my payments.
I've considered maybe trading in my vehicle for a leased vehicle.
My reasoning is that I drive less than 15k miles a year and I'm not looking to own the same car for more than a year or two.
However, I've yet to find any good leases that are less than $300 a month for a decent car. Maybe I'm not looking in the right places. Leasing is still new to me.
My other options are to possibly trade in my car for a cheaper one and just compound the rest of my payment on top of the other one.
Yet, I'm in a dilemma where I really do not want to downgrade in vehicles, but due to my financial situation I may have to.
So this is where some advice is needed, I am still at a financial loss either way I go. However, which seems to be the better path?
Leasing, due to my driving habits and wanting to drive different vehicles. (Yet I still have to pay off the extra amount on my car)
or
Trade in for a cheaper car and just add the extra cost on to the new one.
My main goal is to some how try and lower my monthly payments, without sacrificing too much of a nice ride.
(PS, I've looked into bank refinancing, but not too much luck)
Thanks.
It's free to see if you can refi, and if you qualify, you may be able to skip 3 months in payments, so you can catch up. My friend did it and saved about $5,000 over the course of a 60 month loan he got from his dealer.
Their site is www.autorefi.com. Again, I know people that have used this service, but I am in no way affiliated with this company and will not benefit in any way from this! It's worth a try. Good luck!
It sounds like you got soaked big time. Get past it, it's over. HOWEVER, you do need to figure out where you stand. 10.xx % is high interest to be sure, but it's not the end of the world. If you've paid on time, you should indeed look into refinancing... the catch is that nobody is going to give you a low-interest loan on $18k for a four-year-old economy car. My guess is this car books in the low $10-11 retail. Unless you can get a low-interest loan for that part and a reasonble cash loan for the other $7, I'm afraid you're stuck.
And please, familiarize yourself a little with simple-interest financing. $10k over 3 years is $300/month at 7% or so. Over 5 years it's $200/month. Everything else simply scales -- take out a $15k loan, payments are x 1.5. Easy.
Good luck,
-Mathias
To pay it off today would cost me $18,353.90
There's definitely more to this story. What exactly is "the rest"?? Might that be some negative equity poking out its ugly head?
However, I've yet to find any good leases that are less than $300 a month for a decent car.
Is that with or without your negative equity? With the negative, I understand, but there are certainly plenty of good cars for less than $300 ... but once you add the negative nut ... ouch.
If you really only drive 4k miles per year, I don't think leasing is even in your best interest. You'd wind up with a ton of unused miles that you're paying for and won't get refunded for.
'11 GMC Sierra 1500; '98 Alfa 156 2.0TS; '08 Maser QP; '67 Coronet R/T; '13 Fiat 500c; '20 S90 T6; '22 MB Sprinter 2500 4x4 diesel; '97 Suzuki R Wagon; '96 Opel Astra; '11 Mini Cooper S
Absolutely right on that.
The car isn't the problem, it's your financing that's the problem, and I suspect that means that you have poor credit. Don't compound the situation now by rolling over further negative equity.
Keep going on looking to refinance some or all of it. Take a part time job at McDonalds or someplace if you have to increase your income by a few hundred a month.
Plan on keeping that car for another four or five years or so, even longer if possible. Take pride in maintaining it well. After that, you probably will have been able to clean up your credit and then you can perhaps start over.
First rule of finance: If you're already in a hole, quit digging!
So my credit is fine, it’s low because I haven't had much but yea its good. Now as for the miles part, I'll be driving more in the coming year, to at least 10k. And for the McDonalds job, not needed, I work too much already.
Anyways, my solution that I've been conjuring up so far is this.
I trade in my ride for a 24 month lease. Car trade in goes around for $8-10k. My trade in pays for more of the lease. I have about $7-9k still owed from the trade in. I end up paying about $300 or less monthly. Within the two years, my lease is up, and my car debt gone.
I'm out with a car, but now I can start fresh.
Ultimate goal is to get a different car and have lower payments.
So is my plan flawed? Or does it make some sense?
For those it makes sense too. Now questions about leasing.
Where does the money from my trade in go to?
Should I be paying down payment?
Just exactly how would this sort of work out?
Ideas, comments, questions?
Thanks.
It doesn't make sense. in your original post you said "To pay it off today would cost me $18,353.90" now you say "I have about $7-9k still owed from the trade in."
Or am I missing something.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
You have NO equity in your current ride, so NONE of it goes towards the new car. The car is worth 10 and you owe 18, that means you will carry 8 PLUS the cost of the new car.
Now let's back up a sec .... after 1 full year of making payments, you still owe $2k more than the original purchase price of the car! Something is terribly wrong here. Just taxes and tags does NOT add up to a full year of payments PLUS another $2k. This situation is impossible. You either did NOT pay $16,500 for the car or you added in a few thousand bucks of spit shine, tire warranty, bug repellant, etc, etc.
'11 GMC Sierra 1500; '98 Alfa 156 2.0TS; '08 Maser QP; '67 Coronet R/T; '13 Fiat 500c; '20 S90 T6; '22 MB Sprinter 2500 4x4 diesel; '97 Suzuki R Wagon; '96 Opel Astra; '11 Mini Cooper S
Actually I think he is taking his payments and multiplying them by how many more payments he has to get to that $18k+, what he owes on the loan is most likely closer to $15K.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
so how bout it, gunman? did you actually call to get your payoff? Or are you guessing by doing the math. If the latter, call and get the real payoff. Interest on loans is not all thrown in up front, it is accumulated day by day. So your principal balance goes down every time you make a payment (hence my confusion as to how you can owe more than you claim to have originally financed).
'11 GMC Sierra 1500; '98 Alfa 156 2.0TS; '08 Maser QP; '67 Coronet R/T; '13 Fiat 500c; '20 S90 T6; '22 MB Sprinter 2500 4x4 diesel; '97 Suzuki R Wagon; '96 Opel Astra; '11 Mini Cooper S
So what's the point of the lease?
He is hoping to trade in his old car, pay it off, get into a new (or another) car as a lease for less money and walk away from it in two years owing nothing.
The only problem is thats never going to happen without a massive downpayment, which negates any benefit from leasing.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
Here are some of the run down of numbers from my account.
========================================
Contract Type: Retail
Original Amount Financed: $20,596.43
Scheduled Maturity Date: 08/20/2011
Monthly Payment Amount: $389.54
Annual Percentage Rate (APR): 10.60%
Retail Payoff Amount:$18,406.97
Good Through Date:08/14/2006
========================================
Now I have to look at my contact again for exact numbers on the totaling of costs, but from talking to a financial agent from Toyota here is some more info that I have.
The total amount Financed is $20,596.43
I have a Simple Interest Contract.
Finance charge at 10.60%, totals $7,450.45
So from what the agent said. I practically drove off the lot with a car costing me $28,046.88 -_-;
Ok I still need to look at my contact again for specifics in options and all. But here is a general run down.
Car = $16,500
Mechanical Breakdown Coverage = $2,075
Gap Insurance = $495
So this comes to $19,070
I know I also got a car alarm, which was like $300-$400 and then the Registration Fees, Title, Plate... etc.. Should make up the other $1,526.43
So there. There are the numbers roughly to my first car buying experience, which seems to have gone horribly wrong.
Now I'm trying to bump out of it.
This is where my lease idea came from, hoping that if I trade it in for a lease deal then, just finish paying off the left over costs that the trade in didn’t cover, I’ll be out of it within maybe two years.
So is any of that idea fact or fantasy?
If it is fantasy then, I’m guessing I need to try and sell back my vehicle to a dealer or something
Ugh .. I really got messed up.
Being a 'cash and carry' person, I couldn't begin to understand his situation and what he was trying to do.
Running the figures the payoff really should be about $18K (presuming you have made 12 timely payments). It looks like they are using the rule of 78 to come up with that payoff, but in all honestly I couldn't make the figures come out that way.
I really hate to tell you this but unless you put in a whole lot of money into the lease deal you will be stuck with this for more than a couple of years.
My advice is to keep trying to see if you can refinance the car to get the payments down.
Just remember that you have some serious negative equity in your car. Trading it in for a new car either buying or leasing will just get you deeper into the hole. You can get into a lease and get out of this mess in a few years but to do that you will have to put a massive down payment or live with much higher payments or both.
Also remember that if you sell the car, either to a dealer or a private party, you will have to pay off the note before you can give them the title. That means you will have to again come up with several thousands to add to what you get for the car to complete the sale.
So my best advice is to keep the car and do everything you can to refinance at a lower rate. Thats the only thing you can do to keep from digging yourself deeper into the hole.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
However, if you can afford a new car every three years, you have more spending money than we do.
We keep our cars much longer unless we give them to our kids. For example, last year we gave a 6 year old car to our daughter and a 8 year old car to our son, and they appreciated it very much.
If it is fantasy then, I’m guessing I need to try and sell back my vehicle to a dealer or something
Guess you're getting the idea from everyone's comments that this plan is complete fantasy. You will not get yourself out of any financial hole by attempting a lease when you've got negative equity already.
The one thing you did right, in fact, was planning to own, not lease, the car you've got now. That gives you control: you can keep it for as many years as you want, you're not locked in to some dealer's schedule of when you have to return it, and eventually, if you own it long enough, you will be car-payment free AND you will still have a car!
The other smart thing you did was you bought a good, dependable car that should give you years of service.
My advice: do not mess up that part of the apple-cart! Look to refinance if possible. Second best is to pay more than you owe for the monthly payment each month, in order to reduce the amount of interest paid and to get it paid off sooner.
You wasted some money on Mechanical Breakdown Coverage, but that's small potatoes in the ultimate scheme of things. Your only serious issue now is the high rate of interest. If you can get that down to 5 or 6%, which should be very do-able with a record of making payments on it for a year, that should help you a lot.
By the way, if you go to "Owe more than it's worth... I'm upside down and I can't get up!" in the Smart Shopper forum, you'll get an eyeful of stories just like yours!
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With the amount of negative equity you have trading for less cash per month is going to be next to impossible.
Only you can say.
Few things to keep in mind. 12000 miles a year isn't really a whole lot. If you go over that be prepared to pay big time in fees (on a per mile basis). so make sure that you won't need more than 48,000 miles in that 4 years. Things change and you might find yourself putting more miles on in a couple of years.
As I mentioned before, things change. Do you really want to commit to $500+ a month payments for 4 years? If something happens and you need to get out of that car if you own it you can always sell it but it is very hard to get out of a lease.
With a lease at the end you have nothing, but if you buy when you finish paying off you still have the car. The down side is that with buying your going to have much larger payments.
Personally I buy cars and keep them until the stop running. that means if I were you I would keep the old one (that is unless it is falling apart), pay it off, keep it for a few more years and pocket the car payments. But only you are you and only you can make that decision.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D