Paying for a 100,000 dollar car. (lease, car payments, luxury, credit)
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i'd say if you're smart and really want to own a 100k car, you should save up and buy a two or three year old one and pay in cash. that's what i would do.
it's not as hard as you might think........if you're determined and really want to make it happen.
I think most people who buy cars pay cash. If you can afford to spend $100,000 on a car, money is clearly not an issue for you. Besides, most places that sell those types of cars probably only offer the most exclusive financing options.
It's OK to turn it into a finances question, because that's what buying a new car is all about these days anyways! You don't need money to buy a car, you just need credit. Then it's on you to budget for your payment along with all your other expenses. Unfortunately, too many people don't consider the full cost. This partially explains our current economic plight. A credit-based society can only last for so long, as we've learned.
Depends a lot on what you are buying. Collector cars can be financed quite easily. The have value that does not go down like daily iron. There are specialty lenders that follow the markets, auctions, and will lend accordingly, depending on your credit. Sometimes you will need to put up another car as collateral to make some loans work....Give it some time, you will get there, it just takes age, income, and determination. Start small, buy your first car with cash, pick the right one, that will grow in value, and go from there. I started out that way, many of us do, eventually I got that 100,000 car and then another one, then sold one, on and on. You do not have to be rich to make it work, you just need determination, and the love for Historic, collectible cars. Doing a lot of your own restoration helps also, at lest when starting out..... It was a fun ride, lots of touring, car events, social involvements, and , in the end , if you buy smart, it can finance your retirement. Thats what I did.
On the one hand, I think you'd have to be nuts to pay $1,000 a month for a car on an income of $100,000 a year. That's 12% of your annual gross income.
I can't imagine that people buying cars at that price point have incomes that low--try adding a zero or two on and you may be in the ballpark.
In general I think it would be nuts to spend that much for a car even if you had the money. I literally cannot imagine any combination of utility and pleasure that a car could provide that would make it worth that much.
On the other hand, a friend of mine whose father drove Rolls-Royces tells me that his father used to say that a Rolls is the cheapest car in the world to own, because when you're driving it you can sell it for what you paid for it. Probably not true if you bought it new, but otherwise it might be.
I would pay cash. If you have it. I've never liked payments. I feel like I "owe" something. I'd rather pay upfront and cash and not have monthly payments.
The vast majority of $100k cars that people buy new are leases with balloon payments and the majority of those are owned by their business, not them personally. Certainly some are owned outright and purchased by their owner, but in general cars are a horrible waste of money.
When I worked as the asset manager of a large private company, I procured the cars for the family and executives. The executive cars were all BMW 5-series and all were leased by the company with a structured balloon payment, it kept the monthly cost low. The family cars were as follows: Bentley Continental Flying Spur, Mercedes S600V, Audi A8L W12, BMW M5, Maserati Quatroporte, BMW 7-series and an Aston Martin DB9. Those were the top end cars and their kids were various ages and had everything from Mustangs and Trans Ams to Yukon Denali's. The wives generally had a collection of Range Rovers or lower end Mercedes. All of the top end cars (including the wives cars) with the exception of the DB9 were leases. All of the lesser cars were bought outright in cash, depreciated on a 4 year schedule and sold.
This is simply the way it's done. Car's that are unique or ultra high end like a Ferrari, or the DB9 above are generally bought and paid in cash, or with structured financing. Leasing with a balloon is the cheapest method for buying these types of cars, but can be difficult unless you have substantial assets given the balloon's involved. Even for the wealthy, it can be difficult to finance a $200k+ car.
There are actually many companies who specialize in these types of programs. One I know of in this area is Fleetway Leasing and they're direct specialty is leasing high end cars to people with a lot of cash and crappy credit (which is more common than you would think).
The best way for a layman to get a car like that is to buy it used, so the $100k car is now only a $60k dollar car. Outside of that, leasing is probably the best way to go, but you need to show decent cash reserves to cover the balloon.
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