New car...buy vs lease?

marty_ga

The amount of money and time my husband spent keeping 2 TR7's running bothered me, but for a long time, he loved doing it in hopes they might someday be worth something

And I've seen where people have spent $10 to $20 grand restoring an old car to factory new condition. I watch them car shows and it's all chunks of cash, not financed. The rebuilt V-6 Vortec I put in my truck last year was $2,600. I would have been better off getting a junkyard motor put in it just to trade it in. Anyway, by the time you get a decent paint job, suspension rebuilt, tranny rebuilt (another $2,000 or more), interior re-done, electrical harnesses re-done, new exhaust, new a/c, alignments and new tires, etc., you've bought a new car. Plus, all the time you had the car in a garage because the work was beyond your tools, capability, or time. So, you had to get a rental or some rent-a-wreck to get around. Did I mention the huge outlays of cash to do that?

My new car, a 2007 Pontiac Vibe is costing $15k. With 10.4 % my payments are $372.10 a month. It gets close to 33 mpg. The savings in gas is helping to make the car payment. When I pay it off, I won't wait so long. I'll turn around and trade it in on something new. I've noticed most successful people do that. It's easier to budget and manage a car payment than it is to come up with a couple of grand every now and then for a major car problem. So, we only go out to eat on special occasions and we might go out to the movies once or twice a year. But we've got reliable wheels under us to get to work so that we can pay for what we do have.

 Umm...10.4%...?

10.4 % interest. My credit history isn't always shining, though my credit history with GMAC is rock solid. I make car payments the priority. Without a car, I can't get to work.

Fow whatever reason, used cars tend to be at higher interest rates than new cars.  So, 15K on a new car you might be able to get 8-9% instead.  I've always wondered why it mattered to a bank if you bought a new car or used in terms of interest, but it does.

And I'm sure in this wonderful economy interest rates aren't as low as they used to be.  Our car loan back in 2005 was around 8.5%, even with a "perfect" credit history, we didn't have the length of credit and job history behind us, not to mention buckets of student loans.  Back then, 8.5% was really pretty high.  Now, though, it's a different story.

NicoleS

Fow whatever reason, used cars tend to be at higher interest rates than new cars.  So, 15K on a new car you might be able to get 8-9% instead.  I've always wondered why it mattered to a bank if you bought a new car or used in terms of interest, but it does.

And I'm sure in this wonderful economy interest rates aren't as low as they used to be.  Our car loan back in 2005 was around 8.5%, even with a "perfect" credit history, we didn't have the length of credit and job history behind us, not to mention buckets of student loans.  Back then, 8.5% was really pretty high.  Now, though, it's a different story.

Quite true. And when I bought the car, it was at 15 %. They called me the next day when I was at work and asked if I could come up that afternoon and re-sign the paperwork because they were lowering my interest to 10.4. They did the same with DW's new car. She now has a lower interest and lower payment after signing. I'm not complaining.