buying outright vs. getting a loan

>>13935546

Buy a Corolla outright for 1200 dollars.

>>13935588
you don't think I can do better? I guess there is really no reason to spend more if it's just transportation but I would like something at least mildly fun.

http://seattle.craigslist.org/tac/cto/5330779136.html

I should say that if I'm going to buy a daily, I'd like 1996 or newer.

DO NOT BUY WHAT YOU CANNOT AFFORD
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>>13935641
ya I know.

I can afford more if I get a loan.

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You can get a Lincoln Town Car, aim for 2008 and newer and do Uber on the side.

Finance a lightly used econobox so you can begin to build up credit that will be very useful to you later in life. Don't buy a $1200 Corolla. It'll cost you more in repairs than a loan. Plus a lot of hassle and precious time.

>>13935655
how much does a 2008+ town cat cost?

>>13935655
Oh fuck its you again

>>13935665
true, building credit is good. I've had a credit card that I've been paying off every month for a year or two so I have some credit.

>>13935672
That's good. You're basically in the same position as I was earlier this year.

>>13935670
hey, baby blue vic guy is cool ok

>>13935676
what kind of car did you end up getting?

>>13935668
Don't. Do it.

As for the thread, Do your research on what cars are reliable and inexpensive. Getting a loan right now is very reasonable, and as someone else said already, will be great for your credit. Debt is cheap right now and APR rates are low. You may as well grab a loan instead of dumping your cash.

>>13935682
I should check to see what kind of rates I can get. I have heard that rates are low and it's a good time to buy.

>>13935680
I bought myself a new Fiesta SE manual. I put $8K down so my payments are only $111/month. I got tired of constantly having to repair my old shitbox DD.

>>13935692
gotcha. what's your apr?

>>13935708
2.79%

>>13935655
Is that Del amo

>>13935668
You can get one in the $8k range or lower.

>>13935682
Why would you not?

>>13935740

Eh, that's not good. I mean, roughly the average for a first-time buyer with no real credit history.

>>13935546
Getting a loan is cheaper if the interest rate is under 1%.

Your credit is probably bad and what you should probably do is put 5k down, and get a 5-10k loan for 24-36 months at I'm presuming a 2.5-4.5% interest rate.
It'll cost you like $160-$800 in interest for nothing but improving your credit, but you'll save it later on.

If they show you a 5-8% interest rate, tell them to FUCK OFF. If you're putting 33-50% down on a car there is no reason the interest should be that high. It also means you won't need GAP insurance.
And make sure you NEGOTIATE ON THE OUT THE DOOR PRICE and not the payment.
And make sure you read the contract to make sure what the final price of the principle is as well as the rate.

It is hard to get good loans on new cars since the manufacturer tends to offer the best loan terms, though, too.

And people telling you to get a 5 year loan are dumbasses. Ignore anything they ever tell you about anything for the rest of your life.

>>13936058
Actually I shouldn't say that you credit is bad, but that you have small credit.

Even if it's like 800 or 850, if you've never had a real loan of at least 5 or 10 grand, it just doesn't count enough to get you those sub 1% rates.

>>13936063
good to know, thanks. Should I get my parents to cosign or nah?

Longpost Guy says that financing is always better than outright buying it because you can negotiate for a better price, make payments for 6 months while building credit and then paying off the whole thing to not get destroyed by interest.

>>13936968
He says it's better because you use that to negotiate lower price, then when fonanced through a bank you jist hand them the lump sum and be done with it. That only works if what you got allows you to pay in full ahead of time.

>>13935645
If you need to borrow money you can not afford it.... isn't anybody in your family a jew.

>>13936968
>>13937029
that's a pretty nifty strategy, I'll remember that

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people on /o/ are going to whine about loans and how loans mean you cannot afford something.

the key is to calculate the loan payments and insurance and gas and maintenance costs (roughly), they SHOULD NOT be more than 15% of your gross income.

if you're within that limit, a loan is completely manageable and build credit.

>>13935546

Buy a 2000ish LeSabre with less than 100k miles. Should easily be able to pick one up for 3k or less, just have to look. Maintain it, and it will be extremely reliable, and what does break will be super cheap to fix.

>>13937122
Not a fan of Buick sorry

>>13937069
15% of my income is like $165 a month... I'm trying to figure out what the minimum car loan is at my bank. if it's a 10k minimum that already puts me at around $179 a month which is too much.

>>13937182
dont do a car loan through a bank, stick to credit unions, their restrictions are much more lax and their interest rates are much better.

also be sure to pay attention if they have restrictions on age or mileage, like it must be newer than X or have less miles than X

/o/ is literally pants on head retarded when it comes to finances, do not listen to them. There is plenty of multi-millionaires that still finance things because they can get low interest rates and make more on that cash investing it somewhere then they would ever save buying something out-right.

Now, with that being said taking out a loan for something sub $5000 is still stupid, because you are going to get a bad interest rate. Go ahead and buy a cheap Corolla, Camry or something like that for $1200-2000. IF you can do the work yourself, dump another $1000 into getting the maintenance up to date (fluids all around, tires, belts, plugs, etc..). You will literally have a car that is bomb proof for the next decade.

>>13937182
typical credit unions (which is what you should be using for best rates) require auto loans that are 180-200 a month.

that google nerd is right, it can build credit but you must know how to use and abuse it to your long-term advantage. The key is responsibility. There are pros and cons for each, but it sounds like your current situation necessitates getting a cheap, reliable car that you can keep running. An old civic or corolla, with under 100k miles that you can fetch for, say, 7 grand. the 7 grand will keep you from finding the real shitheaps that have been run hard and put away wet, and the fact you're not spending all your money means you still have a savings you can at least look at.

Also banks/credit unions typically don't loan on cars older than 10 years. Also also, google nerd mentioned that insurance, gas, etc is not more than 15%, not just the loan note.

If you have no credit, apply for a credit card and buy all your gas, and only gas, with it, pay it off IN FULL every month. that will start to help your credit score. eventually expand the card to all online purchases, for security's sake. but be careful with it. if you ever find yourself in a situation where you can't pay it off in full you need to fix that (find a way to pay it off) and figure out how that happened and prevent it from ever happening again.

then you will join us in the land of sub-2% interest rates.

>>13937219
>/o/ is literally pants on head retarded when it comes to finances, do not listen to them.
This is true.

>Now, with that being said taking out a loan for something sub $5000 is still stupid, because you are going to get a bad interest rate.
This is even more true. You might actually not get a decent interest rate until you break at least $10k.

My opinion:
Under $10k, buy outright.
Between $10k and $15k, depends a lot on interest rate
Over $15k, finance assuming you can get a good interest rate.

>>13937196
>>13937223
>>13937253
sorry, I meant credit union, not a bank. I've had a credit card through that union for a while now that I've been paying off. I have no idea what my credit score is but we'll see I guess.

Man, dropping 7k on a corolla or something is gonna hurt.

>>13937219
problem is, every corolla on craigslist in the 2k range has 200k+ miles. I understand that they're reliable but that chassis/interior is gonna be a shit heap by then. Also I'd get crushed like a tin can in an accident.

>>13937305
>crash ratings
there's a grain of salt to be had there. and if it's a real concern then you can greatly improve your survival in a larger old Lexus with side airbags and whatnotall.
Check out clean, used ES300s. you should be able to find one (maybe aim for the pre-1999 non-VVTi versions so it's a non-interference engine), with around 100-130 for less than 6 grand. that will be a real reliable machine as long as you keep up on it. You'd want the ES over the Camry because ES's were treated nicer than their low/middle-class counterparts. when it comes to dealer maintenance.

Issue is, if you drop less than 4 grand you're very likely going to get what you paid for, or maybe even less. Sometimes, these things may require more than a grand to get back going to the point where they'll last another 100k.

>>13937336
>transverse V6
>auto
>pigfat

just get a civic OP

>>13937182

You make a grand a month bro. You're not in a position to drive a car that you're a "fan" of. How about you try not to be like every other broke ass faggot in the universe and buy something that you can afford to purchase and maintain. I can't fucking stand this shit. My wife's friend is a stay at home mother of two, and her husband makes about 60k a year. She currently drives a leased Honda Odyssey and was just this morning talking about leasing an E350 Wagon instead.

Take advice from someone who knows how to handle money. Buy the fucking Buick. I can speak for bro because I myself drive a 2000 LeSabre. Purchase price included, that car has probably cost me less than $0.15/mi to operate.

>>13937380
so because I make 1k a month I'm not allowed to choose what kind of car I want? I don't want a fucking Buick LeSabre. There are a lot of other cars I'd rather have for the same price.

Also why are you bringing up your friend's retarded wife? I'm trying to build credit, I'm not throwing money at a lease for a car I can't afford.This post isn't even about what kind of car to get, or leasing. it's about financing vs paying outright.

>>13937380
>more transverse V6 auto garbage

why

From a financial calculation standpoint. Paying off a car will always net you more money than having payments. Even if you have to repair that car every six months. You will always make more money with a shitty used car than with a new car and car payment. The only hassle is your time and energy.

how do you guys feel about 0 down 0% APR for 5 year deals? typically only for new econoboxes like 2015 camry, fiesta, mazda3

>>13937635
gotta watch for the fine print, and you have to have good credit, but they can be good. typically they mean you don't get a good price on the car in general, as you sacrifice other incentives to get that financing.
it really depends on the scenario. be wary of early payoff fines.

>>13937029

Yes but you can make some payments and build some credit without worry.

>>13937596
>Paying off a car will always net you more money than having payments

Wrong...good lord wrong. Why are triptards so stupid?

>>13937219

>don't listen to /o/
>listen to me, the one that is on /o/

>>13935546
Just lease a new japanese car for like $150-250/month.
You have plenty of options, but I'd probably consider a Mazda3. Looks sleek, has decent handling, lightweight, good gas efficiency, and it isn't ultra-boring to drive. You'll probably be limited to 12k miles a year or less, but that shouldn't be an issue if you're using it soley for classes and work.

It's also cheap on your insurance, especially if list one of your parents are the "primary" driver. Assuming your parents are trustworthy and have a good credit history, I'd recommend having them co-sign the lease as well.

>>13937596

If you were going to buy a $25k used car...

As long as you have decent credit, you can get factory finance usually under 1%. Just as a shit easy investment example, you can literally get a 4 year CD at 2% interest rate. Yes, that is a horrible return compared to other investments but it's just an example of how easy it is.

Why would I dump my $25k cash into a depreciating asset like a vehicle when I can go make more money off of that $25k investing. Even a very low-risk investment, practically risk free like a CD (which has a poor return) will still make me more money.

>>13935645
>I can afford more
>if I get a loan

Corolla / civic under 2k is the most realistic option.

I know you want something that looks cool but that's not what you need that's what you want.

Buy what you need now to get done what you need to. Then you'll be able to afford what you want later.

Glhf family

>>13936935
Depends on if it's your only option.
If you just get a 24-36 month loan on $5k-$8k or whatever it is, a 3% interest rate isn't going to cost you much.

If you get a certified pre-owned car, it's probably easier to get a loan and plus you get an extended factory warranty included.

And really, why the fuck would your parents co-sign for you? That makes them liable. It's way more dangerous and stupid than if they would simply give you money(or a loan) to make a higher down payment so you would have to borrow less from a bank.

If you need someone to co-sign, you can't afford it. But you should try to get a small loan on a car to build your credit since it's the best thing to do so.
If it turns out that really all you can get is 6... 8.. 10%+ interest rates even when you're putting 35-50% down, then it probably is best to buy a beater and build credit with credit cards. You can google how to build your credit. How old are you?

>>13936968
This is also mostly true.
You should negotiate on the price of the car first to get it as low as possible with them assuming you're going to finance it all for 5 or 6 years.
You can also use that the interest rate is too high to get the dealer to meet you in the middle with the cost of the interest by lowering the cost of the car.

Not only can you get a better deal, but if you have $5,000 for a car today, in 3 years when you finish paying off the loan that money is worth about 10% less when you make your last payment, due to inflation.
So really you should subtract the graduated inflation from the interest for your real cost (or savings in the case when you have very low interest loans, and that's why it's important to build credit).

>>13937182
If you put $4000 down, and get a $6000 loan 3 year loan at 4% interest, you will pay $177.14 a month and pay a total of $377 of interest.
You can afford that. Just make sure you get a good deal on the car and interest. Like I said, if you can't afford it see if your parents will give/loan you money instead of cosigning.
You can get a 2013 Mazda3 for like 8-9k, and a 2014 for like 12-13k. Either is roughly in your budget.

And yeah, credit unions are good. The factory lenders can give very good deals too, though.

Depending what state your credit is and how close it is to being good, a 4 year loan could be fine with you refinancing after 2 years.

>>13937380
Lmao dude. I got a 15k loan (15k down) with NO PROOF OF INCOME.
I work for myself and took 2 months off prior to buying the car, so my 3 month income history looked shit. There's so much dumb shit in this thread but at least a few people are on point.
If OP can prove he makes 1k a month and that he lives with his parents, he's not going to have a problem getting a loan if he doesn't have no/bad credit.

>>13937419
Ignore them. They're jealous you get 1k a month of discretionary spending with your rent and food paid for. You're in a good position to build your credit thanks to that

>>13937660

Average car payment in the U.S. is 475 dollars. If you bought a 2000 dollar beater and saved 475 a month you could prolly sell that beater for about the same amount in a year and have 5700 + whatever you sold the beater for a new car. Rinse and repeat. You were saying?

Not everyone can get 1% financing, those people probably shouldn't get loans period but the idea remains the same. Using things like debt and low interest are tools that not everyone has the articulation to use.

>>13935546
...sauce?

>>13937596
> Paying off a car will always net you more money than having payments.

You're an idiot. Low interest loans are cheaper than paying with cash. That's why building credit is important. That's why you're a poorfag, because you don't understand that.

It's the same reason governments will take out loans at <1% to create economic growth instead of raising taxes. There is much more net gain that way.
Besides the inflation factor making it cheaper if interest rates are lower than 1%, someone good with money is going to make more money by keeping more in their pocket instead of paying up front which makes them have even more net gained by the time they pay off their loan.

It's also why financial advisers will advise you not to pay off low interest loans early. You can have a <1% loan while you're gaining 3-7% from investments.

This is common fucking financial sense.

>>13937996

>>13937987

That's exactly what I'm saying here.

>>13938010
You don't know what you're saying. They're just words to you. You don't know what they mean, but you post them anyway.

The OP never eluded to buying a $30k car with no money down.

And the way people get <1% interest rates in the first place are by not being shit with money like you and not listening to the advice of people like you.

People are giving him sane advice to buy a newer used or certified preowned car around 10grand or less and to put 35-50% down payment so he can have a nice, newer, reliable car, likely under warranty, that he can build adult credit with while still having a decent amount of savings.

Instead of an endless cycle of $2000 beaters that are miserable while having shit credit into his 30s.

>>13938094

This

Once I qualified for a lower interest used car loan (4%) on a car that I threw 30% down on and made the payments on time every month, my score had jumped over 100 points and I had positive cash flow and a reliable car.

Once I was done with that I got a new car and the trade of my old car was 20% down of the price, 3% for the loan.

Owning a beater on the side is fantastic, cheap insurance, something to wrench on, and a car to rack up milage for errands