OT: Should I pay in full for my car, new or used?

I'm in the process purchasing a vehicle. While I could pay cash, I plan to take a loan. The main reason is that interest rates are so incredibly low. It's almost like free cash.

It's a hard decision - I inderstand.

I own 2 cars for me and if I would never ever buy new because I can't justify buying them new. One was $110k new and the other was $95k new. If I bought both of those new, I'd owe more than my home loan.

I bought both used, low miles, 4 years old and paid less than half the original retail. On both I put half down and have a loan. Since I put so much down I got a 5 year loan on both, at 2.14%, like JS said - money is cheap right now, I could pay the loan off quicker but what's the point? I think I pay around $30 in interest a month. Where I may get fucked? Neither car has a factory warranty so any repairs are on me. I can do brake jobs, fix lights, maintenance and stereos on my own, but engine work is out of my league.

On the other hand my friend had a car that booked at $15k and when be traded it in, they gave him $27k. when he said that I know he got fucked. He bought an $80k SUV brand new. He wants a warranty as he cant do maintenance like I can. In the long run I think he gets fucked more than me but maybe I am wrong. It all depends on what interest rate he got but I doubt he did better than me. Really I have 2 cars for his one, and I paid less than $20k more than he did for one car. I take care of my shit so in two years my then 6 year old cars will look better than his 2 year old car.

Some people are insecure and need to drive the newest shit, but if you take care of your shit, most people have no idea that you're driving a car a few years old.

I bought my wife a 10 year old sports car to fart around in and everyone thinks it's brand new - people don't know shit

Debt free is my choice in life

Always pay in cash

Also I never buy new always used

Always looking for a deal

Even on my ho lol

I always buy a new car or SUV I the last 3 vehicles I bought, I was able to get 0% financing on them . Usually I'll buy a Cadillac. I will negotiate very sharp and compare prices using the internet.Generally I will keep a car till the wheels fall off usually 250-300,000 miles even more if the vehicle is not causing me a problem. I pay attention to the maintenance and keep the body in good condition. I have never spent more than $50k on any vehicle including taxes and take a write-off from my business equal to depreciation over the length of time I own it. Also I have never brought a vehicle that wasn't American made, I cant see spending the money on a vehicle where the profits go overseas but that is my personal preference. I don't like to buy used cars but as I buy a new car so infrequently I don't mind the cost difference and am very careful to be sure that I get my moneys worth. My current car is a 09 Cadillac CTS and I have over 180,000 miles on the odometer it has been paid off for about 2 years and I expect at least another 3-5 years before I buy a new car.

Dude, like 72os states, you're better off buying used and paying with cash. If u can't do that then you're not at a point in your life to make that purchase.

Smart money says put your money on things that create value. Cars depreciate and even wealthy people will tell you they still drive older used cars because the value that has been instilled in their behavior. That behavior is don't blow shit ($$) on things that suck money. Kind of like spending too much on huuuures.

to everyone who thinks it is better to pay cash : I disagree, and with the cost of money so cheap, you are better off with a 1 or 2% loan but put the accumulated cash into an ETF or some other instrument that will give you a greater return than the cost of the loan. Keep your cash and use it to make more cash. The vehicle will be paid off eventually and you will still have the cash.

^^^ good advice - especially if you get a good interest rate which you will for the next several years

Although I like newish cars, I won't find it practical to buy a brand new one until I'm a millionaire. Too much depreciation. I'd lease though.

I think buying a car with cash is smart if you have the funds, but if you are trying to build credit then a finance would be the way to go, put down a good down pmt, and once your credit rises to your satisfaction just pay the car off. But if you have thin/no credit, your interest rates are likely to be higher. However, if you finance you can get more for less money up front, but will obviously pay more down the road.

Your student loans should be enough for you to have some credit established. Once I took out student loans I was able to get my first credit card & started getting a new pre-approved credit card or car finance offer in the mail like once a week lol. My credit shot right up after opening 3 credit card accts and making timely pmts. So that's an easy way to build credit.

just a little advice for you younger folks out there Never use cash to buy an item that depreciates only buy for cash things which appreciate in value in the long run you will have more money and the things you own will be more valuable.

For all u dumb fucks who said he should take a loan out for a depreciating item, because it's "smart" to borrow cheap money are about as silly as they cum.

If your using cheap money to borrow for a home instead of cash, that is the smart play, but when it comes to a car it is always more brilliant to drive the biggest piece of shit you are comfortable being seen in that is reliable. All this talk about "borrowing" and putting the rest into an investment is scuttlebutt, poor advice. He would be better off buying the cheapest reliable vehicle for cash and investing the remainder. 99.999% of success with money is behavior, and if you start with bad behavior of borrowing money for vehicles then you begin to lose when it comes to money. There's no other way to advise it no matter how you spin it.

It's like the car salesman saying "your better off with a lease because you can write the payments off as a tax deduction"! Another example of bad advice. Cash is king.

Wow meat didn't realize you were Warren Buffet posting on here we all must defer to your investing brilliance can you lend me $10.00 for a lap dance

There's no right answer for everyone. And there's no real way for us to give you sound advice (assuming sound advice on this topic is possible from a bunch of degenerates like us) without knowing your goals and constraints. That won't stop me from commenting, but take it for what its worth.

In my opinion, for those who buy a vehicle and keep it for more than 6-8 years, purchasing a new vehicle over a used one can be advantageous. There are some savings to be had in financing and incentives that offset the accelerated depreciation of a new vehicle. There's also consumables that eat into that (tires, brake pads, air filters, windshield wipers, shit like that.) To me those tend to be more significant than the risk incurring additional maintenance costs during the long term that can be caused purchasing a vehicle that was poorly maintained and/or otherwise mistreated by its previous owner. Add in a couple extra years of warranty and the enjoyment from simply having a new car, and that's the way I tend to lean.

Slightly used vehicles are good for situations where you want or need a vehicle that's a bit out of your price range when new & don't plan to keep it for more than 4 years or so or when you plan to keep it for only a short time, maybe 2 years. This way, you can save yourself the accelerated depreciation and minimize your exposure to significant maintenance costs.

As far as paying cash vs financing. I'd say it depends on the rate you can get and the opportunity cost. If you're going to sit around with 60k in your checking account and dole it out $500 a month, there's no point in financing it. If you would otherwise use that 60k to purchase an investment property, an extra 3% on your car note probably leads to a net gain. If your credit is for shit & you're buying an older car, you might be paying 15% & its probably not worth it no matter what the opportunity cost. Of course, I'm assuming someone with shit credit has questionable judgement when it comes to finances and has already taken some risks that didn't pan out.

Again, there's a shit-ton of assumptions baked in here. For example, if you're the mechanical type and would be doing your own maintenance the value proposition for a used vehicle skyrockets. If its a situation where you actually enjoy doing that sort of thing doubly so. A scenario where you've got a kid and do that sort of thing to spend time with your kid & teach him the trade might be a good example.

"25" if I knew you were at the same club as me I would buy you a couple dances for sure. Party on.

thanks buddy

" "25" if I knew you were at the same club as me I would buy you a couple dances for sure. Party on."

You're a brilliant guy Meat72!

As others have said, it depends. But based on the longer description I would say "pay cash".

Yes cars depreciate, but if you just want to be hassle-free you walk in, get a new car, and use it until you sell it. Unless you're getting some sort of super-expensive car like a Lamborghini or something cars just don't represent a big enough chunk of change to be worth stressing about.

Have fun with a brilliant new car! ;)

You can always write the investing guy I read an article on in the Sunday paper and ask him the question. When I was young, I was going to pay almost all cash for a new car I liked. The dealership told me it would be better to build a credit history and to write the first check for less than 10k to avoid IRS attention. I don't know if they were questioning where I got all the money. They didn't question me. I had been working for years driving around in old clunkers.

now that I'm older, building a credit history is not an issue. I've read or heard buying new vehicles is for millionaires. The financial advice guys usually say buy a good reliable car that has some mileage on it to cut down on the severe depreciation. I know there are program cars that have been driven some and slightly used cars. There is an opportunity cost to what you could use the money for as well. If your cash would be just sitting in a checking account, then go ahead and pay in full for whatever car you want. You might as well enjoy it.

If you will need extra cash for retirement and haven't saved enough, then a used car is a better option is what the financial gurus will likely say. How much you need for retirement is a whole other set of questions that most Americans never took much time to think about or plan for. If dancers knew how much I saved already, they might think I was rich. Me, I don't think it's anywhere close to what I might need.

probably not on the air anymore but there used to be a show called the Suze Orman show. A female financial guru and there would be a segment of the show called Can I afford it? They would ask people for a detailed breakdown of all expenses and income and savings and retirement savings. Then the caller or writer would ask can I afford to buy anew sub costing 40k or whatever. Then they would do the numbers and say yes, no , or you're crazy, no way. Many viewers or writers were crazy, some not.

'well being that I'm young, I don't think my credit is all that high. Last I checked, it was at 620. I believe that's around average correct? And since I don't really spend on many bills, just my gym membership,the credit building is going pretty slow if at all. So if I got financing I'm not sure the bank would be too kind to me with low to no financing especially since I'm STILL trying to fight with the credit bureau to take off an item off my credit report that I wasn't responsible for. Definitely sounds like used cars are the way to go, but I'm going to try and find a lightly used one for half the cost of it's original purchase. Don't want to start off with 100K mileage and I simply drove it off the lot/driveway.

While I know buying American "stimulates" the economy, the fact of the matter is, barring European cars the foreign cars mainly have their factories in america so I don't see how America isn't profiting. Even American car companies import their parts from overseas, so its kind of hard to see where the line is blurred between domestic and foreign for many car companies.

I'm not mechanically inclined when it comes to cars but I hope to be so so I can spend less at the auto shop. so I'm glad you mentioned that. Better prepare myself for that sort of investment.

As a young buck of 24 on my FIRST car, and being that it seems best to buy used, is it even worth it to finance when you're paying $10-17K. That's a high school salary right there.

@twentyfive I think I understand what you're saying about financing when you can get a low to no interest for a good chunk of time, but seeing that I'm 24 and more of a liability to most insurance companies and banks (AND no matter what they say, they always judge you based on where you from, so they may use that against me without saying it. One of those things of living in the hood or an low-income environment AND buying a truck. That's 1 invisible strike and two visible strikes against me), I seriously doubt they'll start me off with a low finance deal. Or at the very least a low finance deal for more than even 6 months much less a year. But I'm making educated guesses. i'm sure you guys know better whether my acusations are true.

Sounds like you don't have much credit built up so you may want to think about giving down half to make low payments, then pay for one year to help build your credit up then pay it off. Best of both worlds for you that way.

As far as new vs used. Yes used is cheaper and cars depreciate the second you drive off the lot. However with used you NEVER know how the previous owner(s) treated the car. So it's always a gamble on if the car will always have maintenance issues or not on used where with new YOU have control over that.

I would go certified used from you a dealer. For about half the price of a new car, yo u can get a 3 year old, low mileage vehicle that has just come off lease. We bought each of my daughters a 2000 Jeep Cherokee, one blue, one red in 2003 for their college transportation. Both were utterly reliable, both had 15,0000 miles (roughly) on their odometers, and both cost us $15,000 (each). A car like that can be driven for eight or more years with decent care.

Personally, I would use this as an opportunity to build your credit rating at minimal cost. Put down a good amount, say 30% and do a two or three year loan. Also, a lot of insurance companies provide auto loans at better rates than dealers if you have a policy with them.

Used always.

In my life I've only had one car loan, one mortgage (less than $50K) and a 1 year bridge loan to buy a new house before the old one sold. My credit score is over 800, so I tend not to believe it makes sense to pay a whole mess of interest in order to have a good credit score. If you pay your rent and utilities on time, that will also count towards your credit score.

Not to go dad on you Staf, but I think your best move is to pick a reliable car that will cost you under $20K. I know it's bad for getting lucky with civvy chicks, but maybe you could just say your black Escalade is in the shop and you got stuck with a shitty corolla for your loaner car.

I will always take a used car over a brand new car. Much better value in my opinion.

lol @ ilbbaicnl sorry ladies, my 2016 mid sized escalade is in the shop. But hop into my bitch ass of a shitty crossover lol. Nice. But I wanted a truck for me and the fellas, not to pick up chicks. Any girl who's only interested in me for my car would get the boot asap.

@ATACdawg certified used dealer huh? Oh boy, I was hoping not to have to get a hustling crew together but if that's the best measure for used then I just might.

@mrrock how about 75% down. i don't mind saving up for that amount.

I personally favor paying cash for a late model pre-owned car with some warranty still left on it, and keeping it for 6 years or more.