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Old 02-04-2014, 04:17 PM
 
71 posts, read 152,015 times
Reputation: 27

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>I will be purchasing a used car around June/July.
>Not trying to go over $16K for the total purchase price.
>A car not older than 2011
>My Credit score is about 711.

let's say I find one at $15,000. By July my savings for this car will possibly be up to $10K. Would it be smart to put the full $10k down payment on the car and finance the balance? Is it tough to find loans for $5k or less? Is there such thing as TOO MUCH DOWN PAYMENT?


My main focus is really keeping the monthly payments low so I can afford the rest of my bills for the month...but I'm not trying to put too much money down when i don't have to Any advice?
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Old 02-04-2014, 04:27 PM
 
Location: Denial
603 posts, read 482,107 times
Reputation: 655
Quote:
Originally Posted by DPooch167 View Post
>I will be purchasing a used car around June/July.
>Not trying to go over $16K for the total purchase price.
>A car not older than 2011
>My Credit score is about 711.

let's say I find one at $15,000. By July my savings for this car will possibly be up to $10K. Would it be smart to put the full $10k down payment on the car and finance the balance? Is it tough to find loans for $5k or less? Is there such thing as TOO MUCH DOWN PAYMENT?


My main focus is really keeping the monthly payments low so I can afford the rest of my bills for the month...but I'm not trying to put too much money down when i don't have to Any advice?
just pay cash for whatever you find...lots of reliable $6-10k vehicles out there.
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Old 02-04-2014, 04:37 PM
 
71 posts, read 152,015 times
Reputation: 27
i would probably have to get a much older car for that and I don't want to go through the maintenance for an older car. I'm already driving around in a 2002 car that is on its last leg.
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Old 02-04-2014, 04:49 PM
 
Location: Denial
603 posts, read 482,107 times
Reputation: 655
so...you haven't even looked then...by your response, that is the only logical explanation IMO.

don't put money into depreciating assets. don't loan against depreciating assets.
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Old 02-04-2014, 04:53 PM
 
Location: Sinkholeville
1,211 posts, read 462,117 times
Reputation: 1530
Interest rates are so low that it's almost free money, so why put anything down?

Wouldn't it be nice to keep a few thousand dollars in your pocket for emergencies?

Finance as much as they allow, and if any month gets too tight, raid that wad of cash in your pocket. You'll enjoy that fun zone where you finally owe less on it than you have in savings, followed by getting out of debt with cash in savings too.
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Old 02-04-2014, 05:02 PM
 
Location: Denial
603 posts, read 482,107 times
Reputation: 655
Quote:
Originally Posted by ChuteTheMall View Post
Interest rates are so low that it's almost free money, so why put anything down?

Wouldn't it be nice to keep a few thousand dollars in your pocket for emergencies?

Finance as much as they allow, and if any month gets too tight, raid that wad of cash in your pocket. You'll enjoy that fun zone where you finally owe less on it than you have in savings, followed by getting out of debt with cash in savings too.
the OP has a cash flow issue (see the original post)
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Old 02-04-2014, 05:22 PM
 
Location: Jamestown, NY
2,915 posts, read 1,701,446 times
Reputation: 4678
Quote:
Originally Posted by ChuteTheMall View Post
Interest rates are so low that it's almost free money, so why put anything down?

Wouldn't it be nice to keep a few thousand dollars in your pocket for emergencies?

Finance as much as they allow, and if any month gets too tight, raid that wad of cash in your pocket. You'll enjoy that fun zone where you finally owe less on it than you have in savings, followed by getting out of debt with cash in savings too.
^^^
Quote:
Originally Posted by midwestlaxer View Post
the OP has a cash flow issue (see the original post)

OP, if you were to buy a $16000 car (including tags/license/tax) and put down $10k on a 4 year loan, your payments would be $ 134 at 3.5% interest. For 3 years, the payments would about $176.

If you bought the same car and financed $11k at 3.5% (kept $5k in the bank for an emergency fund), your payments would be: $322 for 3 years ... $246 for 4 years ... $200 for 5 years.

Putting 20% down ($3200) and leaving $6800 in the bank, your payments would be: $375 for 3 years ... $286 for 4 years ... $233 for 5 years.

You're the only one who can decide how much in payments you can afford and for how long a term you want as well as whether or not you feel comfortable in totally depleting your savings to have a lower payment.

There are a lot of scenarios you can try with the numerous on-line loan calculators. This is one that I like because it has so many different ones: Easy Calculation.

I would talk with your bank or credit union to have an idea of how much you're approved for and at what interest rate before you go car hunting. Always get your own financing rather than taking the dealer's, especially on a used car. If you are trading in your be careful that you negotiate the price of the used car first. Then talk the value of your trade. Since you are looking for a late model used car, go to a new car dealer for one. Any 2011 or 2012 you find at a used car dealer is there for a reason, and it's probably not a good one. Get a CarFax as well.
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Old 02-04-2014, 06:41 PM
 
4,833 posts, read 3,007,338 times
Reputation: 5011
Quote:
Originally Posted by DPooch167 View Post
>I will be purchasing a used car around June/July.
>Not trying to go over $16K for the total purchase price.
>A car not older than 2011
>My Credit score is about 711.

let's say I find one at $15,000. By July my savings for this car will possibly be up to $10K. Would it be smart to put the full $10k down payment on the car and finance the balance? Is it tough to find loans for $5k or less? Is there such thing as TOO MUCH DOWN PAYMENT?


My main focus is really keeping the monthly payments low so I can afford the rest of my bills for the month...but I'm not trying to put too much money down when i don't have to Any advice?

Buy cash and pay it in full. You don't want payments on a item that is dropping in value as you are still paying for. Lots of great cars out there for 8-10k
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Old 02-04-2014, 06:56 PM
 
Location: HI
77 posts, read 46,433 times
Reputation: 107
if you are buying used car, save some cash in reserve, who knows what you may run into.
I'd take out max on the low interest loan from penfed credit union. they got 1.99% used auto loan for 12~60 mo.
they got the best auto loan product in the nation (other than 0% promo from car dealer)
drive it for a while to find out if there's any issue. if you feel solid with car, pay off whatever amount you want your balance to be.
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Old 02-04-2014, 07:09 PM
 
3,296 posts, read 1,100,566 times
Reputation: 1843
Quote:
Originally Posted by DPooch167 View Post
>I will be purchasing a used car around June/July.
>Not trying to go over $16K for the total purchase price.
>A car not older than 2011
>My Credit score is about 711.

let's say I find one at $15,000. By July my savings for this car will possibly be up to $10K. Would it be smart to put the full $10k down payment on the car and finance the balance? Is it tough to find loans for $5k or less? Is there such thing as TOO MUCH DOWN PAYMENT?


My main focus is really keeping the monthly payments low so I can afford the rest of my bills for the month...but I'm not trying to put too much money down when i don't have to Any advice?
Lease a smart car for $88 a month in July and save the difference on top of your $10k. By the time your lease is over you could easily have $15,000+ in savings and just cash buy a car.

Then continue to save $200 a month, give or take, so that in the future you can pay cash for all of your vehicles...
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