Incentives to clear out the 08s?
07-07-2008, 02:05 PM
#21
Platinum Member
Join Date: 05-09-2006
Location: "Upland" Mesa, Arizona
Posts: 6,805
Why would you not want to finance something at 0% intrest. Keep your money and invest it in something that is going to make you money. Cars are not investments they are necessities that depreciate everyday. If your have a majority of the money to pay cash for the car finance it and talk to a financial advisor. That HHR SS will be worth 10k in 3 years so your just throwing your money out the door.
The HHR, in your example, will be worth 10K in 3 years and you will probably owe 12-14K on it. So you're upside down on the car.
If you trade this car for a newer model, at this time, you are still responsible for the difference on the loan balance and the trade value. Thus making your next new car 2-4K more and probably rapped into the next loan.
And do talk with a certified financial advisor, preferably a CFP or CFA. Do not speak with a broker related financial advisor. They will want to SELL you a product for the "money they will save you"....and we all know that direction in the past several years.
Disclaimer.....I was a CFP (license is expired, did not renew).
07-07-2008, 03:20 PM
#22
Senior Member
Thread Starter
Join Date: 07-03-2008
Location: jerSSey, exit 5
Posts: 1,664
Probably good logic....until the end !!
The HHR, in your example, will be worth 10K in 3 years and you will probably owe 12-14K on it. So you're upside down on the car.
If you trade this car for a newer model, at this time, you are still responsible for the difference on the loan balance and the trade value. Thus making your next new car 2-4K more and probably rapped into the next loan.
And do talk with a certified financial advisor, preferably a CFP or CFA. Do not speak with a broker related financial advisor. They will want to SELL you a product for the "money they will save you"....and we all know that direction in the past several years.
The HHR, in your example, will be worth 10K in 3 years and you will probably owe 12-14K on it. So you're upside down on the car.
If you trade this car for a newer model, at this time, you are still responsible for the difference on the loan balance and the trade value. Thus making your next new car 2-4K more and probably rapped into the next loan.
And do talk with a certified financial advisor, preferably a CFP or CFA. Do not speak with a broker related financial advisor. They will want to SELL you a product for the "money they will save you"....and we all know that direction in the past several years.
Many people pay off car loans and direct the money elsewhere into their budget to pay for other things. We make sure we keep the money in a separate fund (gaining interest) so that it is used for the sole purpose of buying a new vehicle when the time comes.
07-07-2008, 04:02 PM
#23
Senior Member
Join Date: 05-26-2007
Location: ...
Posts: 1,554
No loan on my lowly 1LT, paid cash difference on my trade.
I like being debt free more than I like rolling the dice in the casino formerly known as the stock market, although I do have a portfolio, I just prefer to buy cars as outright as I can afford to, when I can.
I like being debt free more than I like rolling the dice in the casino formerly known as the stock market, although I do have a portfolio, I just prefer to buy cars as outright as I can afford to, when I can.
07-07-2008, 09:45 PM
#24
Member
Join Date: 07-28-2006
Location: lockport ny
Posts: 91
www.gmfamilyfirst.com for gm employee price...
07-10-2008, 07:05 AM
#27
Senior Member
Thread Starter
Join Date: 07-03-2008
Location: jerSSey, exit 5
Posts: 1,664
07-10-2008, 08:16 AM
#28
Senior Member
Join Date: 01-18-2008
Location: Mechanicsburg, PA
Posts: 118
Probably good logic....until the end !!
The HHR, in your example, will be worth 10K in 3 years and you will probably owe 12-14K on it. So you're upside down on the car.
If you trade this car for a newer model, at this time, you are still responsible for the difference on the loan balance and the trade value. Thus making your next new car 2-4K more and probably rapped into the next loan.
And do talk with a certified financial advisor, preferably a CFP or CFA. Do not speak with a broker related financial advisor. They will want to SELL you a product for the "money they will save you"....and we all know that direction in the past several years.
Disclaimer.....I was a CFP (license is expired, did not renew).
The HHR, in your example, will be worth 10K in 3 years and you will probably owe 12-14K on it. So you're upside down on the car.
If you trade this car for a newer model, at this time, you are still responsible for the difference on the loan balance and the trade value. Thus making your next new car 2-4K more and probably rapped into the next loan.
And do talk with a certified financial advisor, preferably a CFP or CFA. Do not speak with a broker related financial advisor. They will want to SELL you a product for the "money they will save you"....and we all know that direction in the past several years.
Disclaimer.....I was a CFP (license is expired, did not renew).
If you have 25K cash to drop on a car and they are offering 0% financing you would be dumb to pay cash for that car. If you finance all 25K and keep the car for 6 years making payments of $347 per month and then invest that 25K earning 5% interest instead you will have earned over $10,000 in INTEREST in 6 years. Even if you decide to trade it in after 3 years you will still have earned enough interest to pay off the negative equity you might have and still keep your 25K.
07-10-2008, 08:43 AM
#30
Senior Member
Thread Starter
Join Date: 07-03-2008
Location: jerSSey, exit 5
Posts: 1,664
I would venture to say that most people's car loans these days are $500+ a month.