Laura asks…
Car and home buying advice?
Hi,
1. Is it true that if you’re buying a new car for cash that you get a rebate (cash back).
I’m asking because I’m trying to decide between buying a $3000 used car and saving to buy a new one in one year or buying a new one with $5000 cash back (’08 suzuki xl 7: paying $23000 instead of $28000) and pay it off in 12 months.
2. what is the best way to get a reliable cheap used car of about $2500 to $3000 that will not need repairs for 3 years.
3. Also, can one buy/finance a home with only two years of credit history, 6 months of employment history with salary of $7000/month, a credit score of 750?
Summary: ‘Should I rent an apartment and buy a $2500 used car now and get a new home and car in 3 years or should I just go ahead and get the new car now and home because (a) if I rent an apartment, after two to three years, I would have payed over $20000 in rent (that would have gone into paying for the home) (b) if I buy a $2500 car now, after two to three years, the trade in value will be close to zero, I might as well get a new one now and pay it off in 12 month.
I need suggestions.
THANK YOU.
CSC101 Customer Service answers:
You get car rebates no matter how you pay.
This has nothing to do with insurance. You might repost your question under personal finance.
Helen asks…
House and Car purchase advice?
Hi,
1. Is it true that if you’re buying a new car for cash that you get a rebate (cash back).
I’m asking because I’m trying to decide between buying a $3000 used car and saving to buy a new one in one year or buying a new one with $5000 cash back (’08 suzuki xl 7: paying $23000 instead of $28000) and pay it off in 12 months.
2. what is the best way to get a reliable cheap used car of about $2500 to $3000 that will not need repairs for 3 years.
3. Also, can one buy/finance a home with only two years of credit history, 6 months of employment history with salary of $7000/month, a credit score of 750?
Summary: ‘Should I rent an apartment and buy a $2500 used car now and get a new home and car in 3 years or should I just go ahead and get the new car now and home because (a) if I rent an apartment, after two to three years, I would have payed over $20000 in rent (that would have gone into paying for the home) (b) if I buy a $2500 car now, after two to three years, the trade in value will be close to zero, I might as well get a new one now and pay it off in 12 month.
I need suggestions.
THANK YOU.
CSC101 Customer Service answers:
If you have “cash” to pay for a new car you may get even better deals.
Just don’t let them know right away that you are payi ng in “cash”…
But to be honest with you: Buying a brand new car is the dumbest thing you can do… As soon as you drive it off the lot it is considered a used car and has lost up to 20% in value….
Buy a certified used car from Carmax.
And stop looking at a car as an asset… It constantly depreciates and you will always end up paying more in loan payments then what the car you drive is worth.
This is what a car means to me: It has 4 wheels, I can depend on it because I make sure that it is regularly serviced, especially the oil changes, and it gets me from point a to point b.
I have the strange urge to be the sole owner of that car and don’t understand why you would want to rent it from the bank.
I don’t care how hold it is… My last one was 20 years old before it came to an untimely end: It was parked on a hill and all the sudden a brand new little Saturn came rolling backwards down the hill and obliterated my car’s front end. How do you think the owner of that car felt when he found that his car was gone because he forgot to set the E-brake? He is still paying for his heap of junk… Mine was bought and paid for many, many years ago…. His insurance paid me $1300 and I bought that Taurus 9 years ago for $1500…
Now who made the right financial decision?
Buy a decent used car for $3000 and go to Carmax to get a certified used car.
About your planned house purchase: Credit Score looks good, employment history: should be OK.. Income is OK but one thing is missing: Do you have a substantial down payment?
You need to have up to 20% down plus another 3 to 6% for closing costs, etc.
Summary:
Buy the used car with cash and send the monthly car payment you don’t have into a savings account. To keep that car running for another 10 years: Do an oil change every 2 months and check all fluid levels and tire pressure once a week.
Keep your credit records clean – do not add a car loan to the load before you apply for a mortgage and keep your credit card debt to an absolute minimum. (no more than $1000 total).
Save up for a decent downpayment… If necessary move into a cheaper place to save more money faster.
Wait another year or two… The housing market is still tanking.
You won’t lose anything but will be able to buy “cheaper” in about 2 years.
And save as much cash as you can… Have huge savings account balances and your bank will gladly talk to you about a mortgage… Trust me.
Chris asks…
home and car buying advice?
Hi,
1. Is it true that if you’re buying a new car for cash that you get a rebate (cash back).
I’m asking because I’m trying to decide between buying a $3000 used car and saving to buy a new one in one year or buying a new one with $5000 cash back (’08 suzuki xl 7: paying $23000 instead of $28000) and pay it off in 12 months.
2. what is the best way to get a reliable cheap used car of about $2500 to $3000 that will not need repairs for 3 years.
3. Also, can one buy/finance a home with only two years of credit history, 6 months of employment history with salary of $7000/month, a credit score of 750?
Summary: ‘Should I rent an apartment and buy a $2500 used car now and get a new home and car in 3 years or should I just go ahead and get the new car now and home because (a) if I rent an apartment, after two to three years, I would have payed over $20000 in rent (that would have gone into paying for the home) (b) if I buy a $2500 car now, after two to three years, the trade in value will be close to zero, I might as well get a new one now and pay it off in 12 month.
I need suggestions.
THANK YOU.
CSC101 Customer Service answers:
Without reading that blog, I can tell you to rent and buy used.
The housing market is not very stable these days. Your job could be a goner one day, too.
A home is still a liability unless paid off. Also, with an apartment, you don’t have insurance, maintenance, taxes, et al. Triple your house’s cost and you have accurately figure how much MORE on top of the mortgage that those costs get you for.
As for the used car, you have to do your homework and research your cars of choice through forums on the web.
I researched trucks, so I found every F150, Chevy, Dodge, et al forum online and looked at the common isues for them.
Who cares about trade in value on a car that has no depreciation hit left to take?
Courtesy of Y!Answers