Buying a car...

Discussion in 'Et Cetera, Et Cetera' started by D_Leotols Toy, Oct 7, 2009.

  1. D_Leotols Toy

    D_Leotols Toy New Member

    Joined:
    Aug 2, 2009
    Messages:
    525
    Likes Received:
    0
    So I just turned 20 today and I'm trying to get myself a newer used car. I have an old sunfire now that's about had it.

    Only problem is, I have neutral credit (building it now) and my parents can't help cosign cause their credit is shit. I have 2 grand down, but getting a cosigner is what's holding me back.

    How do I get around this? Are there any options other than cosigning?
     
  2. VeeP

    Gold Member

    Joined:
    Sep 3, 2005
    Messages:
    1,787
    Albums:
    1
    Likes Received:
    2
    Gender:
    Male
    Best option is to buy something you can pay for in cash. Seriously.
     
  3. D_Leotols Toy

    D_Leotols Toy New Member

    Joined:
    Aug 2, 2009
    Messages:
    525
    Likes Received:
    0
    Ah, shit. Looks like another year of the clunker.
     
  4. jason_els

    jason_els <img border="0" src="/images/badges/gold_member.gi

    Joined:
    Dec 16, 2004
    Messages:
    10,576
    Likes Received:
    25
    Gender:
    Male
    Location:
    Warwick, NY, USA
    Do you have a job? If you do then you should be at it at least 6 months. Creditors want that.

    What you should do is go to your bank and see how much they are willing to lend you based upon your income. If it's only a few thousand or even only a few hundred, take out the loan and try to make it 24 months or less. Then go buy the used car. Small loans, paid back on-time and in full are a great way to build your credit without too much pain. Right now banks are being tight, sorry to say, so don't expect them to hand you the moon. They'll be very conservative in their loan amount. That's OK. Drive your newer used car until the economy really improves and, depending upon your employment situation, have a job that you've been at for a year. You may only have to drive your newer used car for a few years so get something absolutely bullet-proof and always check with your insurance company before purchasing because your rates don't always correspond to the value of the car. You don't want a huge premium increase to surprise you. Any car you take a loan out on will require collision coverage so get quotes with that included if you don't already have it.

    Good luck!
     
  5. vince

    Gold Member

    Joined:
    May 13, 2007
    Messages:
    14,785
    Albums:
    1
    Likes Received:
    538
    Gender:
    Male
    Location:
    Asia
    If the clunker will run for awhile (without nickel and diming you to death) keep driving it and every month put aside some money equivalent to a car payment. It adds up really fast and then you'll be able to pay cash, or go for a smaller loan with a bigger downpayment in hand and the bank will take you more seriously.

    Build your credit rating slowly and don't take any risks with it. If there's a chance you could be in a bad situation and not be able to pay on time, don't take out the loan.

    Yeah the Sunfire is horrible. Drive it a little while longer and save some money.
     
  6. D_Leotols Toy

    D_Leotols Toy New Member

    Joined:
    Aug 2, 2009
    Messages:
    525
    Likes Received:
    0
    The thing is the Sunfire needs about $1500 in repairs. Front hub bearings, new front tires, and fixing the compressor. I have no A/C right now. So I just don't know if it's smart to throw that 1500 into a hole, or put it towards a new car. But at this rate with no cosigner and no credit, I'm stuck. But on the plus side, the mechanic said a Sunfire with only 120k mileage still has a lot of life left. (had it since I was 16)

    I've worked at the same job in a restaurant business for 2 years.

    Jason els, my brother actually mentioned taking out a smaller loan and paying it back, which will build it my credit a lot better. In any other scenario, I'd do that, but it's the fact my car needs those repairs is what's pushing me for my time.
     
  7. D_Leotols Toy

    D_Leotols Toy New Member

    Joined:
    Aug 2, 2009
    Messages:
    525
    Likes Received:
    0
    I've decided to just take out a loan for the repairs. That way I can fix it and drive it longer so I can save and at the same time build a decent amount of credit. At least I won't be wasting the money.

    Does this sound promising?
     
  8. jason_els

    jason_els <img border="0" src="/images/badges/gold_member.gi

    Joined:
    Dec 16, 2004
    Messages:
    10,576
    Likes Received:
    25
    Gender:
    Male
    Location:
    Warwick, NY, USA
    OK, then check with the banks in your area to see what they'll give you. Two years at a job is good. You'll notice that the interest rates for new cars is lower than it is for used cars and, ironically, it's easier to get a loan for the cheapest new cars than it is for older used cars. The cheapest new cars are $10k and a bit over. Nissan, Hyundai, and Toyota all have good cheap cars but they don't come with A/C, ABS, or sometimes even a radio.

    What I would do is look for used late model cheap cars with the extras you want and need and then compare the prices for your loan and see where the break-even point is on loan cost.

    If you haven't been yet, go to Edmunds.com and research the hell out of all the used cars in your price range. You want a car where you can get reputable repair as well so ask people where you live what dealers they like. If you have friends who repair cars or know of independent repair shops which specialize in certain makes, ask people what their reputation is. Honest and reliable repair and service is essential and buying a great car only remains great if you can get it serviced nearby. Edmunds is a fantastic resource for all this. I highly recommend it.

    I research the fuck out of every car I buy. I know the company, the models, the model version, and everything about the car from its resale value to engine displacement and wheelbase to chronic problems. I go into the dealer knowing what the dealer paid for the car and whether the dealer gets holdbacks from the manufacturer and what they are. I know the gas mileage, registration and insurance costs. Cars are the most expensive things you will ever buy that will never appreciate (save for a handful of collectible cars which neither you nor I can afford). That's why when you buy a car, you want to make every penny count. Usually that doesn't work when buying a new car but when new cars are so cheap that the market for used cars is next to nothing, then buying a new car might make sense if you really want to hold on to it for a long time and you buy a make with a great reputation for reliability. If you're just looking for a car to last you for a few years until you get a higher paying job, then stick with used. Another thing about buying cheap but reliable new cars, like the Yaris, is that they will depreciate less quickly than a higher-priced car so you can get a good price for it when you sell it later.
     
  9. jason_els

    jason_els <img border="0" src="/images/badges/gold_member.gi

    Joined:
    Dec 16, 2004
    Messages:
    10,576
    Likes Received:
    25
    Gender:
    Male
    Location:
    Warwick, NY, USA
    Oops! You posted before I saw your decision. It might work. Do you have anything for collateral to secure the loan? If the loan is worth more than the market value of the car you'll have a tough time getting the loan. If, by chance, they will give you a loan, then go to your shop and find out everything that may need repair in the near future and get those things fixed at the same time. Car loans are secured by the cars themselves and the insurance you take out on them. A repair loan in excess of the car's value probably won't be forthcoming.
     
  10. D_Leotols Toy

    D_Leotols Toy New Member

    Joined:
    Aug 2, 2009
    Messages:
    525
    Likes Received:
    0
    No worries, thanks for the advice. Need it for future reference anyhow.

    I have my car, but I'm working on getting full coverage now. She said the car looked like it was good condition, so I hope that counts for something.

    It's a bitch because I have 3,000 in the bank now, so paying it isn't an issue. (about to have 4,000, school grants and scholarships) I just want to build credit.

    I asked for 1,500 as a loan. Would it be best if I decreased the amount to 1,000 or lower? Or would it really matter if the car collateral isn't equal to the amount of the loan?

    Also, I'm going through a bank that's not my own because I heard they were lenient. Would it be easier to use my actual credit union since they can view my account and see that I have efficient funds? Gah, it just seems like everything is working against me when I really need it. Living in Florida under 100 degree weather with an ass load of humidity under no working AC sucks so bad. I'm not even presentable by the time I get to work.
     
Draft saved Draft deleted