Car Loans
Markwell
Posts: 1,616 ✭✭✭✭✭
For the first time in my adult life I'm finally at a place where I'm looking to buy a vehicle from a dealership. It'll be used, but new to me! I've been looking into the best way to get a loan and some say go through a dealer for financing while others say to get pre-approved through the bank or a credit union. Thought I'd turn to my older and wiser BOTL for advice.
From your own personal experience which is better? My credit is young (5 months) but in good standing. I only have the one card and it's a capital one secured with a very small credit line of $290. Your wisdom is welcome and appreciated!
From your own personal experience which is better? My credit is young (5 months) but in good standing. I only have the one card and it's a capital one secured with a very small credit line of $290. Your wisdom is welcome and appreciated!
“Happiness? A good cigar, a good meal, a good cigar and a good woman – or a bad woman; it depends on how much happiness you can handle.” – George Burns
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This last car for my wife, we ended up with 3.4% interest.
Our bank offered 4.2% interest, so the dealer was able to get us a better interest rate.
It varies so much, it's best to cover your bases.
Money can't buy happiness, but it can buy cigars and that's close enough.
MOW badge received.
If we were sitting down at a lounge w/ a stick and a beer, I'd want to find out why you're wanting to buy, how you set your budget and decided what you can spend. Then I'd tell you to save up and not borrow money for a depreciating asset.
As for my financial status, some poor decisions in my past screwed up my life for a good few years. I'm finally seeing light at the end of the tunnel and I've got my credit established at last. Only recently have I got a decent job and I'm able to put aside about $300 from each check, when paired with donating blood plasma twice a week as well. I've been saving it for a down payment. If I were to wait and pay out of pocket I'd be waiting another year at best supposing nothing else breaks on the Pontiac. That's just not an option. Thus I have to turn to a loan or financing.
Looking at my budget I can afford a monthly payment of roughly $200, setting aside the other $100 for unseen emergencies and the raised insurance coverage I would need to pay. That puts me in the total purchase range of a $10,000 financed vehicle.
I'm looking at the 2002 - 06 Jeep Wranglers because I am a Jeep nut and seriously need 4x4 up here in the winter. The engines in those are the everlasting 4.0L I-6 which run like a swiss watch. My previous vehicle was a '99 Cherokee.
Any inline engine is harmonically more stable than a V engine.
Money can't buy happiness, but it can buy cigars and that's close enough.
I've got my truck at 1.74% interest and the wife's car at 0%. Not always easy to find the good financing but it's worth it!
Also - try and go for the shortest term financing you can, it'll save you $$ in interest as well as give you freedom sooner.
edit: from a quick check locally it looks like 4% is around what the current used auto loan rates are in my area at least.
President's day 0% offers from the dealer are around, but disappearing. Looks like they're just special financing, maybe as low as 1.5 on select models this year.
I like Oliva and Quesada (including Regius) a lot. I will smoke anything, though.
Dang, I've been taking Peter's advice without even knowing it. What's a Blizzaks?
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@Trish I currently bank with a medium sized bank and have capital one for my credit. Waiting to hear back from the latter...I did the online thingamajiggy. Going to get some suggestions from my bank next week.
@Sasquatch I'll have to look into navy. I'm not a member of the DOD nor do I have any family in the service.
@peter4jc you're not wrong in saying there's a certain level of emotion attached to this. I'd say it's more towards my refusal to get rid of the Pontiac as use for a down payment. A few friends say get rid of it while others say they understand my desire to keep it for a later restoration.
You're also correct in saying I've convinced myself into getting a Jeep. I could survive with another make or model. Part of my thought is with all the dirt road traveling I do with the railroad stuff/photography I have really been beating the car and needing something more substantial. The rest is just material desire for that type of vehicle.
I really, truly appreciate your advice on squirreling away my money and getting myself prepared for retirement - it's wise advice. I am 27 btw.
To everyone else, thanks for your advice as well. Perhaps I should take a step back and look at this again before jumping in head first. You guys and gals are a fountain of good advice.
Just by nature of this hobby we all enjoy and the costs involved, I'd guess most of us know our way around our finances and we budget accordingly. But when I hear the latest stat about 80% of Americans living paycheck to paycheck, and that 40 percent of US adults don't have enough savings to cover a mere $400 emergency, it makes me think why doesn't everybody get it? Why doesn't everybody deny themselves a little more today and think more about tomorrow? I wrote this next thing on my office whiteboard a long time ago...
So that you are able to do
What you want to do tomorrow
Think of it this way - that extra $300 month then becomes only an extra $100 month when strapped with a $200 car payment. That leaves very little buffer for error, or unexpected expenses, emergencies......or, unexpected reduction in income for any reason. You could be one missed paycheck from total disaster. I did this when younger also and spent many years digging out of a hole. Never again. Now I drive pre-owned and haven't made a car payment in quite some time. Only debt is my mortgage and it feels good. Frees up money to do experiences with, as experiences are worth way more than possessions.
A record number of Americans are 90 days behind on their car payments
This was my last view of the ol girl when I went to pick up my belongings
I bought my SS a couple years ago.
I bought it on payments, because I didn't want to pull $13k out of my bank.
It is paid off.
Had I paid cash, it would have used reserve money meant for something else. Did I need the SS?
Could I have bought a cheaper truck that would have done the job? Yes.
Once it was paid off, we bought momma's Highlander. And in about 2 years, it will be paid of, if we don't trade it in first.
If a person budgets money for a car, they can do well.
Where I live, you have to have a decent vehicle. There is no uber, lift or any of that here.
Money can't buy happiness, but it can buy cigars and that's close enough.
That really sucks about your old car @Trish. Hope things are working out for you.
I currently have 3 outlets of income @Sleddog46. Working full time at the gas station, running an ebay store, and making about $100 per week donating plasma. I had a second job for about 3 months but kept experiencing schedule conflicts between the two. In the end I was making more money and eating up less of my time/gas by quitting the one and focusing on the other two forms of non taxable income. Managing all of that plus a day or two at the railroad where I'm trying desperately to get a foot in the door. I do have a railroad retirement account going, but have not paid into it since losing my previous job in 2011.
So for the time being I need a new transmission, new suspension all around, and a few other odds and ends if i want to keep driving my current car.