Interesting tidbit in the "weekly market report" from my financial guy.

"The average loan size by Americans purchasing cars and light trucks with financing is $28,211 as of the first quarter 2015, the largest average dollar amount ever financed in the auto industry."


Doing a little math, assuming an interest rate of 2.5%, which is what the local Bank of America is offering right now on new car purchases, and assuming a five-year, fixed-rate loan, the payment comes to just a hair over $500 per month ($500.67) on a loan amount of $28,211. That's not a whole lot below my mortgage payment! Total of the payments is $30,040.25, which means $1,829.25 in interest.

Extending it to seven years drops the payment to a little more manageable $366.44. Total of the payments is a little higher, though, at $30,780.24, with $2,569.24 of that as interest.


Not saying any of this is good or bad. Just thought it was interesting.

 

good stuff is spendy

I looked at ditching the Man Van GMC 2500 during the Cash for Clunkers program.

new car sellers were not negotiating
anything I could afford did not have AC and was a pc of crap
anything with AC and not a total fail was out of price range at $25-30k

So, yeah, pretending that there is no such thing as interest... each $10k over 60 months is $167 or so per month. But there is no 0-interest payment plan.

I looked at $330 a month [plus higher plate fees and maybe insurance] and thought how much gas that will buy.

Plus the Man Van has a hitch.

 

Sure their are. We have a 0% interest loan on my wife's Acadia. You just have to find the right manufacturers promotions.

 

As of 6/8/15, zero percent financing is available on 2015 models of the following:

Buick Enclave
Hyundai Santa Fe
Ford Fusion
Nissan Rogue
Cadillac CTS
Mazda 3
Chevrolet Cruze
Volkswagen Jetta
Jeep Grand Cherokee

Everything from luxury to economy, and SUV's as well.

http://usnews.rankingsandreviews.com...est-Car-Deals/


Many of these offers expire June 15, so hurry in to your dealer now!

 

I would love to buy a new car right now but it is not happening, even at 0%. Right now looking at vechicles 4-5 years old and hopfully less than 75,000 miles. Taking my time and looking for the right deal for me.
Looking at small suv with AWD/4wd that get decent gas mileage.

Larry

 

And you have to have stellar credit to get those low rates. Be careful with the 0 interest as you may lose the rebates. If the amount of rebate lost is more than the interest on what you would pay in interest your losing money.

 

I can remember when a home cost the same as new car does now.

I'm not surprised. Well, yes I am. You pay upfront or you pay on the back end. I'm glad that some people still do the math.

In a casual observation, I have know idea how some can afford their home....and their car(s).

I guess I'm not the target demographic.

 

They are more than my first house. Wait until interest rates start to go up, I can hear the cries now...

 

I've seen this, and, yes, there is usually a choice. Take the low interest rate or take the rebate. Do the math and see what's best for you. That's always true.

On one car we bought new in 2012 (a Nissan Rogue now in the hands of my daughter), we could get the advertised rebate ONLY if we also financed the car through Nissan's financing unit. We couldn't just pay cash or finance through our bank or anywhere else. So we took the loan and the rebate, and paid off the loan after three months. There was no restriction on this.

 

That's what I used to recommend to customers. You'd be surprised on how many people would not take the extra $1k and finance for a short period of time. They would rather not be bothered. Each to their own I guess.

 

I bought my 2007 Volvo V50 in May 2013 with just under 96,000 miles on it. I got 5.8% APR for 6 years and my payment is $236/month

I bought it at a Chrysler dealer in Rocky Hill, NJ. They said with my excellent credit they could have put me in that brand new Jeep with all the aftermarket goodies on it already for $450/mo, but then the insurance payment makes that undoable

 

I found a 1991 Ford F150 with 79,000 original miles on it for $4500.00. Paid cash for the truck, sunk another $2000.00 into it by buying four new Michelins, four new Bilstein shocks, replacing the intake manifold gaskets (common issue with this model year), belt, pulley tensioner, transmission flush, etc, and I now have a nice truck thats paid for.

 

My wife's 2005 Acura TL has been paid for for three years, and I had a low mileage 1999 Acura Integra 5 speed coupe for the past 4.5 years. I paid $4500 for it and loved it until I spaced out and totaled it last month. Erie Insurance gave me $4200 for it (minus my $500 deductible). Not bad!

I was going to just use my Oldsmobiles and my Corvette as drivers until mid-Fall then just use the TL (both of us work from home). However, two weeks ago Budget Rent-A-Car at Kansas City airport gave me a brand new Scat Pack 6.4L 6 speed Challenger at no extra charge. I can't stop driving past my local Dodge dealers now.

Terry

 

Holy Moly! That's a good rental!

 

I went through this argument a few years ago with my wife until she finally saw reason. This was when gas prices sky rocketed. We had a Durango that I had bought new and was now paid for. She wanted me to trade it and get something that was more fuel efficient. The Durango had a 360ci motor and the heavy towing package. It's a tank and only gets about 17mpg on the highway, but it was built to last. It was an '02 that I had a 5 year payment plan on, and got 10 years of great driving out of.


After explaining that a new SUV would run more than $500 a month (which is way more than I spend on gas in a month) she relented.


The kicker is that about 3 years after the argument, I wound up trading her in anyway (the Durango, not the wife) for a 2012 Santa Fe. She had just reached that point in mileage where major components were starting to go (the Durango, not the wife).

 

I have done the math on this theory many times. The cost of a Toyota Prias just never added up. A Chevy Yukon was cheaper to buy, and own and operate.

A lot of people just don't get it.

And what about a Smart car? They won't hold any Groceries, let alone anything large. I have noticed there are no Smart cars in the Costco parking lot.

 

It never has. The extra cost of the hybrid over a comparably-sized gasoline engine car was never recovered in a reasonable amount of time in fuel savings, even when gas was $4.00 per gallon. Now that's below $3.00, the payback is even worse. The government used to offer tax incentives to buy them. I don't know if it still does.

The Prius has always appealed to the green set. People who want to feel good about the car they're driving, environment-wise. They don't do an economic cost-benefit analysis because they don't care about this.

The problem for these people is that these cars aren't necessarily better for the environment. I always tell Prius owners, "don't look too hard at where the rare metals that go into the production of the batteries comes from, and don't think too hard about where all of these batteries, with their rare earth metals, will be disposed of one day."

 

Yeah. The batteries are what will get the Prius owners in the end. They just forget that batteries do not last forever and will have to be disposed of eventually.


I read a report a few years ago that said that when the Prius' batteries do reach their end of life, it will cost over $10 grand to replace them.

 

Coming from a long line of cheapskates, I have never bought a car "on time" (as my mother used to call it). I've always driven used cars and paid outright for whatever I could afford, no matter how decrepit. I like to think I've saved a buck or two and made life simpler over the years, but when I think back on some of the nightmarish used cars I've owned, I'm not so sure.


Strangely enough, I think the cheapest cars, the real beaters that I bought for $300 when I was a kid were the best. They never seemed to have problems, at least not ones I couldn't fix, and when they did I had so little invested it was easy to cut my losses. Where I started getting in real trouble was when I started spending more money on nicer cars.

 

I have been trying to convince my wife to do exactly this. Only now, three years into seeing the advantages and disadvantages of "Buying On Time" as compared to buying a less expensive vehicles for cash, has she began to see the light. My latest purchase, the 91 F150, finally did it. My older truck is actually way nicer than her eight year old BMW X3, which is now showing it's real inner self. The luster has worn off and the dash is lit up like a christmas tree.