Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Have you canceled that warranty? What a complete waste of money.
"I can cancel at any time"... so you're making separate payments on that? It's not rolled into the loan? Because if it IS rolled into the loan, you can't simply cancel it.
And everyone else, geez, stop getting "on him" over the 11% loan. Yea, that's really high but you know how it works in this country: if your credit sucks, you have to suffer with a higher interest rate. Now, I've never really understood why this is so, but it is. OP went to HIS bank and this is the best he could get? Obviously he has bad credit. He should be commended for going to his bank.
Could you imagine if he dealer financed? 14%???
I just bought a 2005 Volvo V70 2.5T with 70k miles and I'm not sure that really made sense.
The price was $8700 and with 11.5% interest over 4 years the total price is about $11k. Fine, but there's no warranty. So I added a Wells Fargo engine and powertrain 3yr/36k warranty for $2600 which comes out to $65/month (yes generally a bad idea but I can cancel it whenever I want).
So I've spent almost $14k for a 10 year old car with 70 miles. My payment is $290/month. In 5 years I'll probably have put another 70k on it and it will be worth $3000 maybe.
Wouldn't it have made more sense to buy a new VW Golf Sportwagen for $23k? I'd have a more reliable vehicle with a full warranty. If I got 3% interest over 5 years I'd be paying $436/month. The car would probably be worth $15k.
If you look at it as cost per year, I'm paying $11k to own a vehicle for 5 years, while if I bought new I'd be paying $8k. That's not even factoring the benefits of reliability, and the gas mileage (30mpg vs 17mpg).
Conventional wisdom says that buying new cars is a bad idea, and I think conventional wisdom is dumb (and so am I)
What would have made more sense is to walk in with cash and offer them $6,000 for the Volvo with no interest rate. Then take it over to a shop and have them go thru it for maybe $1,500. You then maintain the car and drive it for the next 200,000 miles, changing the oil every 3,000 having the tires rotated every 6,000 miles, keeping up with the service during the life of the car.
Even better deal: Look for a car auction. Our friends picked up a 2007 Honda Civic for $500 at auction. They have auctions in our area each month. The current list has almost 30 cars and trucks on it. The smart thing to do is look for one that is late model and has a current registration. In California you have to pay to bring it current meaning it can cost you for each year the car was not registered.
Have you canceled that warranty? What a complete waste of money.
"I can cancel at any time"... so you're making separate payments on that? It's not rolled into the loan? Because if it IS rolled into the loan, you can't simply cancel it.
And everyone else, geez, stop getting "on him" over the 11% loan. Yea, that's really high but you know how it works in this country: if your credit sucks, you have to suffer with a higher interest rate. Now, I've never really understood why this is so, but it is. OP went to HIS bank and this is the best he could get? Obviously he has bad credit. He should be commended for going to his bank.
Could you imagine if he dealer financed? 14%???
Buying an extended warranty in itself isn't a bad idea, but more times than not, buying one that is not a manufacturer's warranty is. At least he did go to his bank, but it isn't always a bad idea to see what the dealership will give you. Sometimes they can beat the interest rate, a lot of times, they don't. The perfect scenario, and maybe the OP did do this, would be to shop different banks for car loans, and especially credit unions. I don't know if there are any credit unions in Hawaii or not, but that would be the first place I'd go. Even if he had bad credit, often times, credit unions are able to offer lower interest loans than any of the mega banks. And if not a credit union, a small community bank might be the next best choice. He could still look into one of the two to refinance.
I am camp used cars, it make sense to me. I have never bought a brand new car.
As for credit, everyone is different, a buyer can't expect best interest rates with low credit scores.
With that being said, I assume op scores are low, so at 11% isn't bad. At least he got into a car. That's his only option.
As for the Volvo, I don't know much about it, but a quick search on the model, doesn't look so good as for reliability and maintenance,
But if you like the way it looks, the way it feels, and you can put up with the nuisance that comes with it.
It doesn't matter what anyone thinks.
And everyone else, geez, stop getting "on him" over the 11% loan. Yea, that's really high but you know how it works in this country: if your credit sucks, you have to suffer with a higher interest rate. Now, I've never really understood why this is so, but it is. OP went to HIS bank and this is the best he could get? Obviously he has bad credit. He should be commended for going to his bank.
Could you imagine if he dealer financed? 14%???
To guard themselves (lenders) against risky borrowers (people with poor credit - aka "trustworthiness"), and to capitalize on them (the more important reason).
Have you canceled that warranty? What a complete waste of money.
"I can cancel at any time"... so you're making separate payments on that? It's not rolled into the loan? Because if it IS rolled into the loan, you can't simply cancel it.
And everyone else, geez, stop getting "on him" over the 11% loan. Yea, that's really high but you know how it works in this country: if your credit sucks, you have to suffer with a higher interest rate. Now, I've never really understood why this is so, but it is. OP went to HIS bank and this is the best he could get? Obviously he has bad credit. He should be commended for going to his bank.
Could you imagine if he dealer financed? 14%???
It's not a separate payment, it's rolled into the loan but if I cancel it they pay the money to the bank, so part of the loan is paid off. Essentially it takes my loan principal way down but with the same monthly payment for a shorter term. I researched and apparently the Wells Fargo warranty actually does pay out, unless you don't do your maintenance. I don't see how it's a waste of money to spend $65/month for a few months to eliminate the risk of having to pay thousands for big engine problems. A head gasket alone would probably be a $400 job.
It's not a separate payment, it's rolled into the loan but if I cancel it they pay the money to the bank, so part of the loan is paid off. Essentially it takes my loan principal way down but with the same monthly payment for a shorter term. I researched and apparently the Wells Fargo warranty actually does pay out, unless you don't do your maintenance. I don't see how it's a waste of money to spend $65/month for a few months to eliminate the risk of having to pay thousands for big engine problems. A head gasket alone would probably be a $400 job.
My credit rating is 649
I would compare their warranty with the actual manufacturer extended warranty, as the manufacturer warranty might be cheaper and might would cover more than this one will. Usually the rule of thumb is, if you decide to purchase an extended warranty, always purchase it from the manufacturer and not from anywhere else, unless it's somebody like Carmax (if you're purchasing from Carmax.)
A 649 credit rating is on the high end of being poor. So, that explains why you got such a high interest rate. However, assuming that you're making all of your monthly payments on time for the next three months, I would go back and re-run your credit report and see if it's changed. Your credit rating changes quite often, and is likely to be different in three months. If it's higher, I would honestly see about refinancing your loan either with Wells Fargo again, or shop around for cheaper interest rates than Wells Fargo. It honestly would save you a lot of money in the long run and probably help you to pay your car off faster.
I always buy used vehicles and usually buy a vehicle when I find a deal I want and not when current vehicle is on last legs and desperate for a different one. Daily I look at craigslist to see what's out there I look for vehicles under 100,000 miles and in good shape. Not real concerned on age of vehicle.
This is spot on what my Dad taught me in my early years, and what I do to this day. When your vehicle gets to the age/mileage when your common sense tells you serious, expensive things may start to fail, or when the vehicle starts to nickel and dime you more than you'd like, start looking for another used vehicle that fits your desire/need.
Take you time, look carefully, and usually in a few weeks or a few months at most, you'll find a deal that is perfect for you.
The time to shop is before you car gasps and dies on the road for the last time with a $2000 dollar repair needed just to get it running/moving.
I just checked out the car in question. In fact I bet I found the exact car that you bought in Hawaii. Wagons are not my thing but that car looks well cared for. I read a little about that particular car and many people seem to think that the engine is rock solid and should get you into the 200,000 miles or more range. I don't know much about Volvo's as far as how long they last but for the people that I know that have them they seem to do fine with them. I don't think you will sell it for a lot though. Realize that if you are taking 60 months to pay off the car then you are going to end up with a 15 year old car. The only way you are going to get your money out of this thing is to maintain it and drive it for many years after you pay it off.
IMO Volvo or VW? Suicide either way, kill me now..........
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
