I always wondered how you guys felt about 'new' cars since we talk about them all the time. Its refreshing to hear your opinions that I share with many of you.

I've always been a big fan of a car that is a couple years old. Even if you finance it, the payment is half that of a new car payment (or less), and you can afford to fix it if something happens. I get tickled at people who bought a new car because of warranty, stay broke because they are tied up in the payment/insurance/tag fees, only to have it break a year later.... and out of warranty.

 

Ditto, though I have bought brand new on occasion (two of my Cobra's - the 98 & the 04). My 99 T/A was over a year old when I bought it, and my 99 Cobra was a program car. We bought my wife's current 2002 BMW in 2005, and my 97 Mazda B2300 beater was 9 years old when I picked it up for $2300.

Bob

 

I wouldn't mind leasing a car if insurance was figured into it. I just can't see putting insurance on a vehicle that I don't own.

 

Hmmm... I wouldn't say stupid people, but I would say thats further confirmation that the cost of living has out paced a decent wage (I'd say decent is 60k+). The problem is, lending institutions are finding creative ways to prey on consumers who are trying to live at what they deem an acceptiable standard of living (of course acceptable various from subsistance to 3 hots and a cot)

 

I am in complete disagreement.

 

about 60k+, stupid people or wages not keeping up?

 

i guess im an idiot i took out a 5.5 year loan

i bought my car brand new 07 Chevy cobalt. when i weighed the option of buying it used it just didnt make sense. buy a 1 year old car with 10,000 + miles of the bumper to bumper used and save 1000-1500 bucks. or buy a new one with 27 miles on it and then get the new 5 year 100,000 mile power train and road side assistance because 06 and older didnt have that.


to me your just as stupid for assuming your going to save money by leasing. you have to weigh you options and how your going to use the vehicle. also the type of loan you take out should also reflect how long you plan on keeping the car.

for example my mom and step dad trade there car in every 3 years they take out no more then something around 4 years( but usually they make double payments) the thought behind this is at least on trade in they have paid off the value of the car. i took out the 5.5 because i figure i drive the car till the wheels fell off.

 

Wages. While there may be some validity to your point, this would not be the example to back it up. The American lifestyle may have outpaced the American wage, but the cost of living is far below the cost of lifestyle.

Cars, new and used, last longer than ever. No one needs a new car every three years, if you do, you can't drive and or didn't take care of the first one.

Rolling additional debt into a depreciating asset is, a bad decision, and would be bad at any income level. Even if you are in dire straights, and many of the people doing this are not, then the last thing you need to be doing is going and aquiring more debt. While I don't suggest anyone in most cities do without a car, the cheapest of new cars can be had seating five plus groceries.

 

I don't disagree with most people over spending on vehicles, and finance companies make it way to easy. But if people can truly afford the car payment and it is something they like than I say more power to them, because you can't take your money with you.

I think leasing is never a bad option if you can save some money, don't drive a lot of miles, and like getting new cars every couple of years. It seems like most people I know (including my wife) drive at least 20K per year, which usually doesn't work to good when leasing.

I was talking with a finance guy recently he said a lot of truck payments end up in the $7XX or somebody takes out a 72 or 84 month loan to get the payment down. He said minimum payments now days were roughly $400 for new cars, and $500 for new trucks, and with car prices now days it become almost impossible to get the low payments of years past. My Acadia listed at 35600, and the Yukon XL I looked at was 46K. It is becoming very hard to avoid high car payments. Putting down a ton of money is never good idea in my mind. I always believe in just enough so that I can afford the payment, and then get gap insurance. Why loose money if I get totaled out, and I know people this has happened to.

Buying used is fine, but I prefer to know how the vehicle was taken care of. Plus if you want a low mileage used vehicle it seems you are paying close to the cost of new anyway.

In my case, I just was forced into buying something because somebody decided to pull out in front of my Jimmy when I was doing 50. But in my case, I needed a family vehicle and want to drive it for 10 years, and it made the most sense to buy it. I can take care of it the way I like to, and know that it will last (provide nobody pulls out in front of me again).

 

I'm not saying primary indicator, just another indicator that wages have been losing out (there has been effectively a wage freeze for the past 30 years with wages barely keeping pace with the economy and with the current turn of events falling behind).

 

Sadly living ghetto fabulous is the American norm now. I see people living in a crappy apartment/rental house, yet they drive a new Yukon or Escalade. I wonder how far the monthly payments on that SUV would go towards buying a house...



Sucks to be those in the financial boat the OP mentioned, however, I don't feel sorry for them one bit.

 

If one has to take out a 6- or 7-year loan "to get the payment down", then maybe it's time to start shopping for a cheaper vehicle. That last year of the loan has to be fun - I'm sure it's a satisfying feeling to drop a $700/month payment on a vehicle that has by this point depreciated to a value something less than a new Aveo.

Used cars have got to be one of the best values in consumer durables. When I bought my truck, I paid about half the new price for a vehicle with 39,000 miles on the clock. If one figures that I can get 160,000 miles, I'll have gotten 75% of the vehicle's life for 50% of the vehicle's new cost. Frankly, I hope that people keep on getting in over their heads on new vehicles - it makes for a steady supply of excellent low-mileage used cars

 

Ouch, when I financed my new car, they presented me with a list of payment options, up to 6 years IIRC, there wasn't that much difference going from 5 to 6 years. Maybe 50 bucks a payment (so by association I guess payments might go down a total of 150 bucks for an 8 year loan but I think that would be some rosey mathmatics). Course I must admit, had I known about a local dealer selling GT500's at cost, I would probably be one of those dummies.

Then again I rarely view a car as an investment or weigh the trade in value in X amount of years. I like to "perosnalize" my car far to much for that.

 

Not addressing you specifically...

It'd be interesting to see what the depreciation is on these customized add-ons. The only thing worse than $4200 upside down is giving away those dubs, cold air intake and exhaust system upon trading the car in (with that additional $3000+ likely still carried on a credit card balance). Maybe more people than I'd guess go online and sell off these parts, but that just seems like a lot of work for some people. If people are trading in becuase they don't want the hassle of selling the car themselves, are they going to bother with add-ons that cost less?

 

Well when I traded in my 02 Mustang for my 07, I got 9k on the car and it was fitted with SLPs catted X-pipe and Steeda cold-air as the only overt mods (did a compy tune as well plus SLP UD pullies) and the resale on my car was 8-10k and the dealer gave me 9k. He did comment on my having fitted the car with Michelins as a postive (BS I know since a buddy of mine got laughed at when he asked how much extra he could get on his T-bird trade in with r-model wheels and BFG KDWs).

Of course my current car is headed for a bit more, I've already installed FRPPs handling pack and I'm looking to switch over to GT500 brakes this spring along with rounding out the suspensin with a few more tweaks, but ride aside thats all mostly invisible (except for the calipers on the GT500 brakes). I might be looking for a new car in 11 or 12, wonder what this will od for things then?

Fortunately I really dont car for alot of cosmetic add-ons, epsecially aftermarket wheels (unpsrung weight issues), so I guess that helps.