Contour Enthusiasts Group Archives Forums General Common Interests Buying a car.

I will be buying a car within the next two months or so. I first was going to just pay cash with money I had in stocks. However, since I am going to school and the stocks are what is putting me through it, I am thinking that taking a big chunck out of it all at once is not the best idea. My dad was thinking that buying something with a super low or 0.0% APR and just making payments on a car would be a better idea that was the stock will have more shares to mature with and collecting dividents would be worth more.

Does anyone know generally how payments work with used cars verus new cars as far as the APR goes and things like that.

Suplimentary info: Two years left of school. A little just under 4k a quarter for 3 quarters a year and have about 50k in P&G stock.

---I need as much advice as possible.

--Also looking mostly at compact cars. What would you want to get, both new or used.

-And does anyone know anything about how hard it is to get a Protege MP3 this late in the game.

I don't know anything about the financing stuff, but my dad is thinking of getting the Mp5 for my mom, great car, looks good! and well worth it in my mind! if you don't like, check out the Nissan Sentra SER spec V, many CEG'rs here are buying them. If he goes and checks it out tomorrow, I will ask what kind of financing he can get... and tell ya.. though Mazda with its popularity has a high interest rate.. maybe not.. could be wrong.. in any case good luck, and good luck with school! i'm graduating this year! though I might go back for another year.. :p ohh well all good in my mind

used cars will have a higher apr. You also want your parents to cosign for you as their credit will help. My roomate just leased a sentra se-r spec-v for $240 a month witk $3k down, not too bad, even tho I hate it :p

Does anyone know how much you would uaually end up paying to buy the car after a lease is up? Use the SpecV listed above for an example.

If you can swing the payments without selling any stock, then that's the way to go. Stocks will generally appreciate (assuming you plan to hold on to them for a long term), while a new car will always depreciate.

Leasing is generally a bad idea if you plan to own the car. If you buy the car at the end of the lease, you would pay the pre-determined residual value (what the contract says the car will be worth at the end of the lease). In recent years, this has been higher than the actual market value, which means it wouldn't be a good decision (although this is changing now). Plus, you're already into the car for the amount of all the lease payments plus interest. When you add all this up, it very rarely makes financial sense to lease a car if you plan to eventually own it.

With 0% financing, it may actually be cheaper to buy a new car vs. a used one. Figure out what the total (with interest) payments would be at the end of a used car loan (the loan officer will be able to tell you this, or you can use an online calculator) and compare it to a no-interest new car loan. Keep in mind that most if not all of the 0% deals are for 36 mo. financing, which most people can't swing. There's also usually a minimum down payment for these deals.

If you cant find an MP3, check out the Protege 5. I drove one for a day and was very impressed. The V-Spec also seems like a great car, but I haven't driven one. Could you wait for a Focus SVT? If not, check out the regular ZX3... it's probably the best bargain out there right now.

Just my $0.02.

WHAT EVER YOU DO, DO NOT LEASE. buy used and put the minimum down. arrange your own financing so the dealer can not mark up the interest rate he tells you he got it for. get the nada value on any car you are buying to see that you are not getting screwed. buy a used contique because this is the cheapest used car you can buy. or a zx-2. this is a cheap fun car. on a 10000 dollar car, each full point in interest rate amounts to about 6 dollars a month on a four year note. save your stock money. notes are cheap and buy from an indenpendent dealer or and individual as they usually expect less than the franchise dealers. never pay more than wholesale from an individual. kelly blue book is usless, use the nada values. be patient and shop around, but when you find the one, buy it. us used car dealers know these things.

Goodness, dealer, do I disagree. The key is to keep an eye on the bottom line. I have seen cases where it is cheaper to lease, and then buy the car at the end than to finance it outright from the start. Whether to buy new or used is a matter of personal choice. A car is a purchase, not an investment, so buy whatever you think is worth the money to you. I would expect to pay more than wholesale/trade-in for a car from a private seller, as they are selling it themselves to get more than a dealer would pay them. However, it should be considerably less than retail. On financing, shop the dealers, shop banks, shop around for the best deal. Credit Unions tend to be the cheapest, but there are no absolutes.

My advice is to shop around, drive around, and get the best bottom line on the car you like the best. I do agree that you should keep your stock portfolio intact. Keep it for a rainy day or as a down payment on a house when that time comes.

I'd stick with the Protege MP3 or Protege5 over a Spec-V. I drove one, and besides the cheap dash and garish upholstery, the ride is bone jarring hard. Very difficult car to live with as a daily driver.

Unless you have established credit you will need your dad to cosign for you to get ANY financing at all. On a used car expect to be paying anywhere from 10% to maybe 15%.
Unless your dad buys a new car under his name only I don't think you will see the 0.0% APR.
Good luck!

The only way you can justify making payments on a car in your situation is if you can get a super low interest rate. This is highly unlikely with a used car. You have to look at how much interest you would be paying when you really don't have to. It is like throwing money out the window if you have enough to pay cash in the first place.

My advice would be to buy the car with cash and make monthly investments of roughly the same amount you would have paid in monthy car payments. This pay yourself philosophy will net you more money in the long run.

Ed

I just want to claify something that you said. You are saying that I should pay for the car straight up with cash from my stocks(the only place where I could get the money) and then start putting money back into the stock month by month? Other than stock money, I wont have any other income besides a part time job during the school year. I will also need to pay for insurance and I dont think that I could handle both of these payments especially as a Design student and only working part time if at all. I will be working two jobs this summer to build up some money.

-If others out there have some more advice, please send it my way.