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Old 11-24-2014, 11:56 AM
 
89 posts, read 169,267 times
Reputation: 45

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Hi All-

It has been 2 years or so since we have had a car loan. While it has been nice we have spent a few thousand dollars per year to maintain the paid off car.

The current car is a 2006 Cadillac Escalade ESV.( Yes we need the space and NO we dont car about the gas). The car currently has about 120k on it and is paid off. However, it is a bit of a money pit and it needs some more work. (suspension,rear compressor, sunroof drain is leaking, steering feels loose and kind of clicks when turned sharply, etc...)

We have decided we are moving out of state next year to a place with 6% sales tax. We ideally do not want to buy another car, especially finance since we will be applying for a home loan but My credit union is offering 1% auto loans up to 84 months and we live in a state with no sales tax.

Would it make sense to replace the SUV with a newer lower mileage one before we leave? Most likely with another GM SUV.

Just an FYI: I am posting this in the personal finance section as well
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Old 11-24-2014, 12:06 PM
 
Location: Connecticut
470 posts, read 1,659,419 times
Reputation: 402
I would wait on the car loan if you are looking to apply for a new mortgage. Having a large, new, debt may look bad to the banks when you apply for the home loan.
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Old 11-24-2014, 01:21 PM
 
18,525 posts, read 15,506,793 times
Reputation: 16208
Quote:
Originally Posted by Panther2004 View Post
Hi All-

It has been 2 years or so since we have had a car loan. While it has been nice we have spent a few thousand dollars per year to maintain the paid off car.

The current car is a 2006 Cadillac Escalade ESV.( Yes we need the space and NO we dont car about the gas). The car currently has about 120k on it and is paid off. However, it is a bit of a money pit and it needs some more work. (suspension,rear compressor, sunroof drain is leaking, steering feels loose and kind of clicks when turned sharply, etc...)

We have decided we are moving out of state next year to a place with 6% sales tax. We ideally do not want to buy another car, especially finance since we will be applying for a home loan but My credit union is offering 1% auto loans up to 84 months and we live in a state with no sales tax.

Would it make sense to replace the SUV with a newer lower mileage one before we leave? Most likely with another GM SUV.

Just an FYI: I am posting this in the personal finance section as well
How much are your repairs costing you a year? I highly doubt it's more than the depreciation on a new SUV!
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Old 11-24-2014, 01:23 PM
 
15,749 posts, read 20,340,859 times
Reputation: 20895
I'd wait til after the mortgage application is approved until financing a new vehicle.
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Old 11-24-2014, 01:52 PM
 
3,046 posts, read 4,107,186 times
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Quote:
Originally Posted by BostonMike7 View Post
I'd wait til after the mortgage application is approved until financing a new vehicle.
Also when you move you are going to have to get a new plate. I know in Florida when we moved from illionis it cost us over $500 to get our car registered in Florida. Now if we bought a car in Florida we could of avoided the transfer fee.but since our car was only 2 yrs old we just transferd.
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Old 11-24-2014, 02:03 PM
 
Location: Houston, TX
2,052 posts, read 5,854,474 times
Reputation: 1298
Even if you buy the car now, you might not escape paying sales tax on it when you transfer the title/registration. You need to look up the laws on moving to your new state regarding sales tax on transferred vehicles. Most often you will pay the difference if your prior state charged less in sales tax.

I too would wait on it due to the home loan. And no reason not to use your credit union after you move for the loan. They should have similar terms when you are ready and once you are a member, you are always a member.

Good luck!
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Old 11-24-2014, 04:10 PM
 
3,278 posts, read 5,367,685 times
Reputation: 4072
I'd get an estimate for the repairs before doing anything drastic. Parts wear out eventually on all cars, you might just have to eventually fix the same bits on a new vehicle too.

The new GM SUVs are absolutely wonderful and will steal your heart, beware.
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Old 11-25-2014, 07:18 AM
 
Location: East of Seattle since 1992, 615' Elevation, Zone 8b - originally from SF Bay Area
44,328 posts, read 80,639,850 times
Reputation: 57341
In our state, if you have owned the car less than 90 days and move from another state, they charge you excise tax (about 10%) when you go to register it. You must by law register it within 30 days.
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Old 11-25-2014, 09:12 AM
 
89 posts, read 169,267 times
Reputation: 45
we are going to fix and keep it. We like the idea of having a newer car but it just isnt justifiable right now. It gets old feeling like it always need something but in reality its a one or two time a year event.

Besides, it is in mint condition and we have repaired most of the things that need to be as they have needed it. Also, the thought of having an auto loan again makes me want to vomit, no matter how low the rate!
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Old 11-25-2014, 12:31 PM
 
Location: Connecticut
470 posts, read 1,659,419 times
Reputation: 402
Good idea. Back in 2006 I had just bought a new car (Ford Fusion). A few months later I wanted to buy a house. Every place I talked to said the same thing... "well, if you didn't just buy a new car this would be a whole lot easier"
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