Buying a New Car



  • I am looking to trade-in my 2007 Subaru STi and use the money as a down payment on a 2019 STi. Historically, they don't offer finance promos on this car because it is a "boutique" car and in high demand. However, I think that since the overall new car market is soft right now, the manufacturer is offering 1.9%, which is lower than any local credit union, let alone major bank. The financing promo ends on Feb 28th. They may renew it, they may not. They may also increase the rate to the 2s or higher and then I would get a loan at high 2s from my credit union.

    I am trying to decide what to do, as my current car has an exhaust leak that just started last week and has some oxidized paint on the rear spoiler and the rear windshield tint is bubbling and needs to be redone. I have been planning on fixing the tint and paint prior to getting rid of it, but I just don't know how much time it will take, and if the amount of money the dealership would give me for it would be worth the cost and hassle of fixing the cosmetic issues.

    One scenario I was thinking was that I could just get the new car and front myself the cash for the down of say 14K and then sell/trade in my current one after fixing the cosmetic issues to pay myself back. Then I thought about the fact that my CD and high yield savings account rates are more than the loan amount, so I would be losing money by making a large down payment. I just don't like the idea of that large of a car payment.

    Anyway. What do you guys and gals think?



  • @wrx7m said in Buying a New Car:

    I am looking to trade-in my 2007 Subaru STi ...

    WTF. That car is like your identity! It's like trading in one of your children!



  • @wrx7m said in Buying a New Car:

    I could just get the new car and front myself the cash for the down of say 14K and then sell/trade in my current one after fixing the cosmetic issues to pay myself back. Then I thought about the fact that my CD and high yield savings account rates are more than the loan amount, so I would be losing money by making a large down payment. I just don't like the idea of that large of a car payment.

    Don't get emotional about financial decisions. Buying a car or not buying a car is partially emotional, yes. But how you finance it is not, that's pure business.

    That you don't like large car payments, my MIL would say... suck it up, buttercup. Putting one penny down more than you have to is just throwing money away.

    Get the car on the law interest rate, 1.9% is fantastic. Finance every penny you can, throw in some extra, if you can 😉 Set aside every dollar that you can towards it that you want to use as a down payment, use that as collateral to ensure that your interest rate stays as low as possible.

    Then, don't waste that money, put that money into an interest bearing account. Not savings or CD, but into something more aggressive like an index, because we are talking years of investment here, with a lot of money.

    Now make the minimum monthly payments. If you need to keep your monthly reasonable, pay the amount you would have been comfortable with per month from your normal income, and top it up to the minimum required amount using the fund. This way you are gaining interest every month. When it comes time to pay off the car in a few years, you'll have earned a bit of money from the process that can stay in the fund gaining more interest, forever.





  • @scottalanmiller said in Buying a New Car:

    @wrx7m said in Buying a New Car:

    I am looking to trade-in my 2007 Subaru STi ...

    WTF. That car is like your identity! It's like trading in one of your children!

    This is the same one... just newer lol
    I had a 2003 WRX from 2005 to 2012 and have had this STi since 2011.



  • Buying a base model saves a ton of money. We bought a base dodge caravan and I easily installed all the extras for about $400 out of pocket. Instead of going up $10k and really not getting much.

    I installed an android head unit, backup camera, flip down TVs, and some other small things. The only thing we don't have that the luxury model has is leather seats and a separate rear ac controller. I admit the rear ac controller would be nice, but it wasn't worth the $10k to me.



  • @IRJ said in Buying a New Car:

    Buying a base model saves a ton of money. We bought a base dodge caravan and I easily installed all the extras for about $400 out of pocket. Instead of going up $10k and really not getting much.

    I installed an android head unit, backup camera, flip down TVs, and some other small things. The only thing we don't have that the luxury model has is leather seats and a separate rear ac controller. I admit the rear ac controller would be nice, but it wasn't worth the $10k to me.

    Thanks. There is no real base model on this car; it is their flagship. Also, I would buy late model used, but the savings is next to nothing, as the car holds its value and doesn't depreciate much.



  • @wrx7m said in Buying a New Car:

    @IRJ said in Buying a New Car:

    Buying a base model saves a ton of money. We bought a base dodge caravan and I easily installed all the extras for about $400 out of pocket. Instead of going up $10k and really not getting much.

    I installed an android head unit, backup camera, flip down TVs, and some other small things. The only thing we don't have that the luxury model has is leather seats and a separate rear ac controller. I admit the rear ac controller would be nice, but it wasn't worth the $10k to me.

    Thanks. There is no real base model on this car; it is their flagship. Also, I would buy late model used, but the savings is next to nothing, as the car holds its value and doesn't depreciate much.

    Yep I understand. I have a friend that's crazy about suburu. I'm a big believer in base models since I like to do automotive work.

    I was able to do all these extras in about 8 hours. I could have ran everything in 2 hours, but I was very careful to make everything look factory. I pulled off all the panels and did it the right way.



  • I would never again buy a new car, even with a promo and heavy discount. The absolute newest I'd go is 3-5 years depending on the car, but generally older.



  • @Obsolesce said in Buying a New Car:

    I would never again buy a new car, even with a promo and heavy discount. The absolute newest I'd go is 3-5 years depending on the car, but generally older.

    The used ones are practically the same price.



  • @scottalanmiller said in Buying a New Car:

    @wrx7m said in Buying a New Car:

    I could just get the new car and front myself the cash for the down of say 14K and then sell/trade in my current one after fixing the cosmetic issues to pay myself back. Then I thought about the fact that my CD and high yield savings account rates are more than the loan amount, so I would be losing money by making a large down payment. I just don't like the idea of that large of a car payment.

    Don't get emotional about financial decisions. Buying a car or not buying a car is partially emotional, yes. But how you finance it is not, that's pure business.

    That you don't like large car payments, my MIL would say... suck it up, buttercup. Putting one penny down more than you have to is just throwing money away.

    Get the car on the law interest rate, 1.9% is fantastic. Finance every penny you can, throw in some extra, if you can 😉 Set aside every dollar that you can towards it that you want to use as a down payment, use that as collateral to ensure that your interest rate stays as low as possible.

    Then, don't waste that money, put that money into an interest bearing account. Not savings or CD, but into something more aggressive like an index, because we are talking years of investment here, with a lot of money.

    Now make the minimum monthly payments. If you need to keep your monthly reasonable, pay the amount you would have been comfortable with per month from your normal income, and top it up to the minimum required amount using the fund. This way you are gaining interest every month. When it comes time to pay off the car in a few years, you'll have earned a bit of money from the process that can stay in the fund gaining more interest, forever.

    So, dealing with the old car could be done independent of this, because I wouldn't be using any of the money from the sale to put down on the new car at the time of purchase.



  • @wrx7m said in Buying a New Car:

    So, dealing with the old car could be done independent of this, because I wouldn't be using any of the money from the sale to put down on the new car at the time of purchase.

    Yeah, I would think so. Do it separately and get a better deal.



  • @wrx7m said in Buying a New Car:

    @Obsolesce said in Buying a New Car:

    I would never again buy a new car, even with a promo and heavy discount. The absolute newest I'd go is 3-5 years depending on the car, but generally older.

    The used ones are practically the same price.

    I see a $10-15k difference between 2019 and 2015 and 2014. That's a huge amount. That's more than I paid brand new for my daily driver lol.



  • Forgive the thread hijack: this deal finally finished today.
    alt text



  • @EddieJennings what did you get?



  • @scottalanmiller said in Buying a New Car:

    @EddieJennings what did you get?

    2019 Toyota Camry XLE



  • Take the car to Carmax for an appraisal.
    Book an appointment online, aren't you in Ventura? There's a CarMax in Oxnard.
    If you like their offer, they'll cut you a check on the spot.



  • @FATeknollogee said in Buying a New Car:

    Take the car to Carmax for an appraisal.
    Book an appointment online, aren't you in Ventura? There's a CarMax in Oxnard.
    If you like their offer, they'll cut you a check on the spot.

    It's too old. I don't think they will take 07



  • @IRJ said in Buying a New Car:

    @FATeknollogee said in Buying a New Car:

    Take the car to Carmax for an appraisal.
    Book an appointment online, aren't you in Ventura? There's a CarMax in Oxnard.
    If you like their offer, they'll cut you a check on the spot.

    It's too old. I don't think they will take 07

    CarMax offered me $1,500 for my 2005 Camry, so I imagine 2007 should be ok.



  • @EddieJennings said in Buying a New Car:

    @IRJ said in Buying a New Car:

    @FATeknollogee said in Buying a New Car:

    Take the car to Carmax for an appraisal.
    Book an appointment online, aren't you in Ventura? There's a CarMax in Oxnard.
    If you like their offer, they'll cut you a check on the spot.

    It's too old. I don't think they will take 07

    CarMax offered me $1,500 for my 2005 Camry, so I imagine 2007 should be ok.

    Wow ok. I thought there was a 10 year limit or something. Maybe that's a local thing



  • Definitely don't trade it in. You'll get ripped off. You're almost always better off selling it privately (here in MI, anyway). Unless, of course, your car is worth less than like $2000 and the dealer is offering $2000 guaranteed... I doubt that's the case though.



  • @Obsolesce said in Buying a New Car:

    @wrx7m said in Buying a New Car:

    @Obsolesce said in Buying a New Car:

    I would never again buy a new car, even with a promo and heavy discount. The absolute newest I'd go is 3-5 years depending on the car, but generally older.

    The used ones are practically the same price.

    I see a $10-15k difference between 2019 and 2015 and 2014. That's a huge amount. That's more than I paid brand new for my daily driver lol.

    I'm with ya on this one. I like to purchase a 1 year off lease from one owner if I can find it. Those are the best deals going. The trick is to find one with 15K miles or less. Do that, you get 30% of list, the balance of the warranty and no need for repairs for two years. Good value at that price



  • @bnrstnr said in Buying a New Car:

    Definitely don't trade it in. You'll get ripped off. You're almost always better off selling it privately (here in MI, anyway). Unless, of course, your car is worth less than like $2000 and the dealer is offering $2000 guaranteed... I doubt that's the case though.

    For me, there was a repair that needed to be done to my 2005 camry that would've either just frightened buyers away, or would make the car worth about $1500. I ended up trading it to my dealer rather than CarMax. Doing the math, doing so cost me $9 over the next 5 years. So for $9, it was worth the convenience of leaving my old car at the dealer and driving new car home.

    Otherwise, I would've definitely looked at doing a private sale for mine.



  • @EddieJennings said in Buying a New Car:

    @bnrstnr said in Buying a New Car:

    Definitely don't trade it in. You'll get ripped off. You're almost always better off selling it privately (here in MI, anyway). Unless, of course, your car is worth less than like $2000 and the dealer is offering $2000 guaranteed... I doubt that's the case though.

    For me, there was a repair that needed to be done to my 2005 camry that would've either just frightened buyers away, or would make the car worth about $1500. I ended up trading it to my dealer rather than CarMax. Doing the math, doing so cost me $9 over the next 5 years. So for $9, it was worth the convenience of leaving my old car at the dealer and driving new car home.

    Otherwise, I would've definitely looked at doing a private sale for mine.

    A few years ago a dealer offered me $2000 for my 2005 Saab 9-3, I ended up selling it to a desperate family member for $2500, I could have sold it privately for about $4000. It's a pain in the ass to sell, and you have to deal with a lot of window shoppers, but if it doesn't cost you anything to sit on it for a few months, you can come out a couple thousand dollars ahead.



  • @bnrstnr said in Buying a New Car:

    Definitely don't trade it in. You'll get ripped off. You're almost always better off selling it privately (here in MI, anyway). Unless, of course, your car is worth less than like $2000 and the dealer is offering $2000 guaranteed... I doubt that's the case though.

    Yeah, it is definitely worth more than that and I know trade-in is lower. I just hate the hassle of having to deal with flakes and jackasses that aren't serious and just want to joy ride. Where I am from, it is easier to say who isn't a flake than who is.

    We'll see.



  • We've made out well twice on trade ins. They were older vehicles with serious mechanical issues. We took advantage of Chrysler's loyalty program and they offered double trade in value since it was a Mopar product. We got $3k for a vehicle with 220k miles and a blown head gasket.

    Trade ins are only good for junkers or in occasion special deals offered by dealer.



  • @wrx7m just curious, to you, what sets the WRX STI apart from the rest of the cars in that price range? It seems like a nice car, but I've not owned one like that.



  • @Obsolesce said in Buying a New Car:

    @wrx7m just curious, to you, what sets the WRX STI apart from the rest of the cars in that price range? It seems like a nice car, but I've not owned one like that.

    Power, handling, feel. It's an extremely serious vehicle.



  • @Obsolesce said in Buying a New Car:

    @wrx7m just curious, to you, what sets the WRX STI apart from the rest of the cars in that price range? It seems like a nice car, but I've not owned one like that.

    Driving a WRX is seriously one of the most fun things I've done. It's got an amazing amount of power for the price. And handling under acceleration is just awesome. It's a ton of fun to ride along with someone racing one too.



  • @coliver said in Buying a New Car:

    @Obsolesce said in Buying a New Car:

    @wrx7m just curious, to you, what sets the WRX STI apart from the rest of the cars in that price range? It seems like a nice car, but I've not owned one like that.

    Driving a WRX is seriously one of the most fun things I've done. It's got an amazing amount of power for the price. And handling under acceleration is just awesome. It's a ton of fun to ride along with someone racing one too.

    I understand. I would have liked that maybe 15 years ago, but now I just drive easy and would never notice these.


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