There's a comedian that does a skit equating buying a rental car to marrying a hooker...both might look good, but you're going to end up with something that a lot of other people have used the hell out of!!

 

LMBO. Exactly my thoughts. They have extremely low miles, but those miles are nasty miles, lol.

 

Makes me think of that scene from The Other Guys when the Prius got stolen and 2 homeless guys mated in it.

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Certainly, and your age has a lot to do with it.  However, think about this for a bit.  Why are loans so "cheap" right now?  Is real estate really a good investment?

 

With the way that the economy is right now, I wouldn't want to hold any debt, and I would rather invest money in something that isn't going to fail in the near future.  Consumer loans and real estate is going to take a huge hit in the near future.  Because money is "so cheap to borrow" right now is in fact what the problem is.  When and if the Fed decides to start raising interest rates, the economy is going to have to correct itself.

 

There is a false sense of security right now.  People seem to think that they can get loans, credit cards, cell phone plans, etc. at "cheap" rates all of the time.  That's all going to change soon.  Once interest rates start rising again, things are going to change.  Not only will the cost of consumer loans go up, but also loans that many businesses rely on in order to stay operational.  That in turn is going to raise the cost of products and services as well as possibly cost jobs.

 

Quite frankly, the economy is headed for a recession if not a depression very soon, and it will be on a global scale.  The global markets are dependent on the U.S. markets.

 

I agree that the economy is headed for a recession. You can also borrow money at a fixed "cheap" rate right now as well, so the feds raising the rates isn't really going to affect that.

 

Depending on what your goal is with real estate, I would argue it is safer than being in the market. If you go the rental route vs the flipping route, even with a mortgage, you can still make monthly income, have write-offs for insurance, interest, depreciation, etc, all the while having the property appreciate every year. If you are patient and do your due diligence, there are ways to make an income while still having loans. Plus, when the price of crude drops substantially or something happens with the Chinese markets, your home value doesn't drop 20% in a week.

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I've bought new only once before that lesson was learned. Let other people pay the depreciation cost. With the quality of cars these days, finding a good used car that will last for years just requires a little research and vigilance.

Agreed.

 

I almost bought a new truck about 10 years ago, but lucked out when the dealership I was working with (now closed) had the truck I wanted.  I went and test drove the truck they were advertising. Everything looked great.  I was in the office doing the paperwork, and the salesman came in and pulled a bait and switch.  The truck they put me in was almost $5k more expensive than the one I was told I was test driving.  Had they simply told me the truck I called about was no longer on the lot, I probably would have considered the upgrade, but they didn't. 

 

When I showed up, they escorted me out to the shiny new truck, I drove it, and they figured they had their hooks in me.  They were wrong.  As soon as the salesman came out and said the truck I drove wasn't the one I'd called about, I got up, asked for the keys to my trade, and started walking to the door.  Between his office and the door, the sales manager tried to head me off to salvage the deal.  At that point, I was as livid as I've ever been in dealing with car guys, and I told that sales manager that after buying a couple of cars from them in the past, I'd be taking my business elsewhere. 

 

My dramatic exit turned comedic when I jumped in the old truck I was getting rid of, turned the key, and a vacuum line blew up on the EFI.  The salesman came out and asked if I'd reconsider, and I told him I'd push the truck off their lot before I'd change my mind.  Unfortunately, it almost came to that.  I rigged it up to get the truck started, but I had to keep the accelerator pressed to prevent the truck from stalling out.  I mapped my course and made it home without ever stopping despite having a couple of traffic lights and stop signs to navigate.

 

The next day, with a better rigging of the line, I went to another dealership, found a year old truck that was exactly what I was looking for with super low miles.  I bought it and never had a lick of trouble with it. 

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Never argue with idiots. They drag you down to their level and beat you with experience.

I just had a rental car for a week. I think it was a Hyundai, and I made sure to take it down to the river bottom a few times for some fun


I'd never get a rental car either. New cars for me please.

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I disagree with this. Depending on the person buying the vehicle and the amount they have up front these services can be of great need.


I'm a former underwriter for a local credit union and I can't tell you how many [BLEEP] stories I've heard from the origination side when a elderly couple living off of social security loses their spouse due to age and they are stuck with a $300 car note with 4 years left on it and can't afford to pay it with only one social security income. I've heard the same number of stories where a young person purchased a new vehicle with no down payment and totaled the car a couple months later and are left with a bill because the insurance wouldn't cover the entire cost of what was left on the loan.


In each instance if the elderly couple would've had the credit life protection the entire loan note would've been paid off and the surviving spouse would've been left with a car paid for free and clear. If only the young person would've purchased the $350 gap coverage the remaining balance of their loan would've been paid off and they could shop for a new vehicle without a $3000 bill sitting on their coffee table.


It just depends on each person. If you have a decent life insurance policy or you put down a decent enough down payment up front then I agree these services won't do you any good. But in today's world the majority of people don't have a life insurance policy big enough to cover the remaining balances on large purchases or they don't have a hefty down to cover the depreciation.


If you are interested in financing definitely do it thru the credit union as others have suggested. The rates are normally unbeatable and if you are interested in the extra coverages also get those thru the credit union as well. Gap alone at a dealership can range from $600 on up and the credit union usually offers it for much less.

 

I see your point, but in both cases, it's a matter of financial discipline.  In the first case, an elderly couple shouldn't be financing anything, especially if they are living off of social security.  Social security is not a retirement plan.

 

In the second case, the young person was buying something that they could not afford.

 

As I said before.  If someone wants to buy a new/late model vehicle, they should save up for it.  $0 down type of loans is part of the reason that caused the financial crisis in 2000 and 2008.  If you can't afford at least 10% down on a purchase that you are going to finance whether it's a car or a home, then you really can't afford it.

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There are 10 kinds of people in this world.  Those who understand binary and those who don't.

I see your point, but in both cases, it's a matter of financial discipline. In the first case, an elderly couple shouldn't be financing anything, especially if they are living off of social security. Social security is not a retirement plan.


In the second case, the young person was buying something that they could not afford.


As I said before. If someone wants to buy a new/late model vehicle, they should save up for it. $0 down type of loans is part of the reason that caused the financial crisis in 2000 and 2008. If you can't afford at least 10% down on a purchase that you are going to finance whether it's a car or a home, then you really can't afford it.

So, what is your stance on someone being able to afford to pay for a car outright, but the dealer is offering 0% financing for 60 months? Do you think it is financially irresponsible to do that even if you can afford it outright?

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So, what is your stance on someone being able to afford to pay for a car outright, but the dealer is offering 0% financing for 60 months? Do you think it is financially irresponsible to do that even if you can afford it outright?

 

Yes it is.

 

First of all, look realistically rather than "wishful thinking".  No car dealer/bank/credit union is going to offer a loan for 60 months at 0% financing.  They might offer that at the beginning of a loan, but eventually they are going to charge interest.  That's how they make money.

 

Second of all, say you take a "0%" loan over 60 months.  We'll just say that your payment is $300.  Is it better to pay your $300 towards a car loan, or is it better to put that $300 in the bank in say a money market account that is earning say 1%?  Over 60 months that adds up.

 

Money in the bank, even if it's in a low interest rate earning account is better than paying the same amount where it virtually "disappears".

 

People constantly get sucked into the "no interest for 6 months" deal on credit cards as well as the "low interest rate" on new cars.  The "zero dollar down" mortgages are the worst.  We've become a consumer based society where it's far too "easy" to get supposedly "free" cash.

 

The bottom line is, if you can't put down at least 10% of the purchase price in cash for anything, you can't afford it and you don't need to be financing it.

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There are 10 kinds of people in this world.  Those who understand binary and those who don't.

Yes it is.

 

First of all, look realistically rather than "wishful thinking".  No car dealer/bank/credit union is going to offer a loan for 60 months at 0% financing.  They might offer that at the beginning of a loan, but eventually they are going to charge interest.  That's how they make money.

 

Second of all, say you take a "0%" loan over 60 months.  We'll just say that your payment is $300.  Is it better to pay your $300 towards a car loan, or is it better to put that $300 in the bank in say a money market account that is earning say 1%?  Over 60 months that adds up.

 

Money in the bank, even if it's in a low interest rate earning account is better than paying the same amount where it virtually "disappears".

 

People constantly get sucked into the "no interest for 6 months" deal on credit cards as well as the "low interest rate" on new cars.  The "zero dollar down" mortgages are the worst.  We've become a consumer based society where it's far too "easy" to get supposedly "free" cash.

 

The bottom line is, if you can't put down at least 10% of the purchase price in cash for anything, you can't afford it and you don't need to be financing it.

I sold Kubota tractors for years with 0% down, 0% interest loans. What they lacked in loan profit they sure as heck made up for in market share.


In your payment example you're spending a total of $18,000 dollars. If you have $18,000 cash to buy said car with and are offered a 0% loan, you should take the loan. The $18,000 will gain more interest in the bank account over the 5 year period than accruing $300 a month over the same period would.

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People advising CPO above all the other options are definitely spot on  *if* you are buying a higher cost car and want the extra assurance of a warranty.  I recently bought a new car for my wife, a 2015 with 18K miles and the remainder of the 50K B2B warranty, plus an extra 5 years 100,000 mile powertrain warranty after that.  The original sticker cost of the car was 51K, my price (after some extended negotiation) was 29K and change.  If you're buying a CPO car that was less expensive to begin with, then the savings can be considerably less.

 

If you are looking for something new under 30K, I'd say consider Edmunds or Autobytel for a good internet price rather than paying a fee to have someone locate a car for you.

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I'm condescending. That means I talk down to you.

I see your point, but in both cases, it's a matter of financial discipline. In the first case, an elderly couple shouldn't be financing anything, especially if they are living off of social security. Social security is not a retirement plan.


In the second case, the young person was buying something that they could not afford.


As I said before. If someone wants to buy a new/late model vehicle, they should save up for it. $0 down type of loans is part of the reason that caused the financial crisis in 2000 and 2008. If you can't afford at least 10% down on a purchase that you are going to finance whether it's a car or a home, then you really can't afford it.

While I agree with you on all fronts, unfortunately that's just the way it is in today's society. Realistically how many people have funds available in a savings account for an emergency let alone money set aside to make 5 figure purchase? I can't tell you how many people I spoke with that were living hand to mouth but were asking for a 40k loan for a Mercedes or Cadillac.

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"Before you criticize a man, walk a mile in his shoes. That way, if he gets angry, he's a mile away and barefoot."

While I agree with you on all fronts, unfortunately that's just the way it is in today's society. Realistically how many people have funds available in a savings account for an emergency let alone money set aside to make 5 figure purchase? I can't tell you how many people I spoke with that were living hand to mouth but were asking for a 40k loan for a Mercedes or Cadillac.

 

It's sad the poor life decisions that put so many people into their own financial hell.  The mistakes snowball, then they are stuck in a miserable situation by their addiction to a lifestyle they can't afford.

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"You do your own thing in your own time. You should be proud."

I sold Kubota tractors for years with 0% down, 0% interest loans. What they lacked in loan profit they sure as heck made up for in market share.


In your payment example you're spending a total of $18,000 dollars. If you have $18,000 cash to buy said car with and are offered a 0% loan, you should take the loan. The $18,000 will gain more interest in the bank account over the 5 year period than accruing $300 a month over the same period would.

 

I get where you are coming from, but the thing is, who is the "$0 down, 0% interest" loan offers targeting?  It's certainly not the person that can afford to pay $18,000 cash outright.  They are targeting the very people that don't have any savings to speak of. 

 

While I agree with you on all fronts, unfortunately that's just the way it is in today's society. Realistically how many people have funds available in a savings account for an emergency let alone money set aside to make 5 figure purchase? I can't tell you how many people I spoke with that were living hand to mouth but were asking for a 40k loan for a Mercedes or Cadillac.

 

That's the problem... and it doesn't necessarily have to be a "luxury" vehicle.  Even someone making a modest salary will spend more than they can afford.  As I said before, if you can't at least afford to put 10% down on a large purchase, then you can't afford it.

 

It's sad the poor life decisions that put so many people into their own financial hell.  The mistakes snowball, then they are stuck in a miserable situation by their addiction to a lifestyle they can't afford.

 

Exactly my point.

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There are 10 kinds of people in this world.  Those who understand binary and those who don't.

I get where you are coming from, but the thing is, who is the "$0 down, 0% interest" loan offers targeting?  It's certainly not the person that can afford to pay $18,000 cash outright.  They are targeting the very people that don't have any savings to speak of.

I don't think I can agree with that. In almost any case I can think of, as either a purchaser or definitely during my time as a sales manager, the better interest rate is reserved for the person with a higher credit worthiness. Not the other way around.


In any case, that has little to do with the question posed.

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I use the 'Rocco and Vinny' car buying club. Their company logo is "You gotta problem with that?"

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I sold Kubota tractors for years with 0% down, 0% interest loans. What they lacked in loan profit they sure as heck made up for in market share.


In your payment example you're spending a total of $18,000 dollars. If you have $18,000 cash to buy said car with and are offered a 0% loan, you should take the loan. The $18,000 will gain more interest in the bank account over the 5 year period than accruing $300 a month over the same period would.

 

So you went from selling tractors to driving one for a living?  You should have sold Ferraris!

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Certified pre-owned coming off lease is the way to go IMO. Let someone else take that initial depreciation hit.

 

For luxury or sports cars that's the way to go. For an economy car the depreciation is low and you're giving up the car's first 20,000 maintenance-free miles. If you're buying (say) a Civic, buy it new. If you're buying a Corvette, definitely go used.

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"Why should I give information to you when all you want to do is find something wrong with it?"

Yes it is.

 

First of all, look realistically rather than "wishful thinking".  No car dealer/bank/credit union is going to offer a loan for 60 months at 0% financing.  They might offer that at the beginning of a loan, but eventually they are going to charge interest.  That's how they make money.

 

Second of all, say you take a "0%" loan over 60 months.  We'll just say that your payment is $300.  Is it better to pay your $300 towards a car loan, or is it better to put that $300 in the bank in say a money market account that is earning say 1%?  Over 60 months that adds up.

 

Money in the bank, even if it's in a low interest rate earning account is better than paying the same amount where it virtually "disappears".

 

People constantly get sucked into the "no interest for 6 months" deal on credit cards as well as the "low interest rate" on new cars.  The "zero dollar down" mortgages are the worst.  We've become a consumer based society where it's far too "easy" to get supposedly "free" cash.

 

The bottom line is, if you can't put down at least 10% of the purchase price in cash for anything, you can't afford it and you don't need to be financing it.

 

A zero percent loan stays zero percent, at least as long as you don't miss a payment. In your example the money spent on a car could instead be invested. At the end of the loan period you come out ahead by doing it that way.


 

There's a big HOWEVER here. The reason the dealer can offer a zero percent loan is because they are charging a higher price compared to the price you could get financing it yourself.


 

Some extra advice. Never ever fall in love with a car. Do the research on what the very lowest price should be for the car, and offer slightly less. Make your offer and be ready to walk off the lot if they won't meet it. I once walked off a lot over a $65 price difference. You'll probably have to walk off a few lots, but eventually you'll get the price you want.

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"Why should I give information to you when all you want to do is find something wrong with it?"

So you went from selling tractors to driving one for a living?  You should have sold Ferraris!

The other way around actually except I never stopped driving them


I did however, sell myself one haha.

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I jinxed myself by posting in this thread yesterday. Today Mrs. Malabar dragged me out car shopping. She fell in love with the car and we spent too much. Ah, as Jamie Lannister said, "the things I do for love."

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"Why should I give information to you when all you want to do is find something wrong with it?"

I'm currently in the market for another vehicle myself.  My 99 Land Cruiser has 285k on it, and it's stranded me a few times in the past 6 months.  Cheap repairs each time, but I can do without the worry.

 

Young used cars used to be the way to go, but over the last few years, they have not undergone the depreciation that made them a bargain.  I'm looking for a truck with 20-70k miles, and they only go about 5 to 10 grand less than buying brand new.  In the case of Toyotas, they come REALLY close to the price of brand new.

 

So, for the first time in 30 years of owning vehicles, I may actually buy my first brand new car.

 

I haven't seen any current 0% financing deals, but would probably jump chance if it really is free money.  I can afford to pay cash, but at 0% I'll let my cash sit in my bank instead of theirs.

 

I hear tax time is not the best time to be in the market, because there are a lot of buyers flooding the market.  It sure seems that way this year, and I may just have to wait it out.

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