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Percentage of monthly income spent on a car?

390 messages,  Last post on Mar 21, 2009 at 6:50 PM

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What is this discussion about? Car Financing

Messages Page 35 of 39

#341 of 390 Re: 10 tips to cut car costs [tidester] by jeffyscott

Mar 06, 2008 (12:32 pm)

Replying to: tidester (Mar 06, 2008 12:01 pm)
Just be aware that one day when you do file a claim it will likely be denied when the insurance company discoveres your true mileage...along with discovering the rest of his fraud.

#342 of 390 Re: 10 tips to cut car costs [joesmith2] by jlawrence01

Mar 06, 2008 (3:05 pm)

Replying to: joesmith2 (Mar 06, 2008 8:00 am)
>>2) Lie to your insurance company about how many miles you drive per year, i.e. lower it. "How many miles do you drive to work?" Answer: "I work from home".
 
4) Tell your insurance company your car is for "Farm Use". I used to work for GMAC Insurance, and rates are lowest for "Farm Use" vehicles. Just because you don't live on a farm doesn't mean you can't say Farm Use. I know farmers who live in apartments, they store their equipment on a farm somewhere and hire themselves and their equipment out. << Reminds me of a young lady that I used to work with a decade ago. She lived in the city but registered her vehicle at her parents' house in the healthy suburbs which saved her about 50% in insurance costs. Well, she parked her car in the wrong area and the car was flooded out one rainy night. Total loss - $12k. She would have gotten away with it if she would have kept her mouth shut. However, she told everybody at work about the situation and how "pulled one over on the insurance company." Somehow, the insurance company found out, assigned surveillance, and eventually declined the claim.

#343 of 390 Re: 10 tips to cut car costs [jlawrence01] by joesmith2

Mar 06, 2008 (3:51 pm)

Replying to: jlawrence01 (Mar 06, 2008 3:05 pm)
I expected to catch some flack about my tips. I doubt if I'll get "caught" lying about my mileage, my odometer quite working. I don't carry any insurance on my car, just the liablity that the state requires. If I cause an accident and have a claim filed against me, my insurance could get cancelled. That's just one of the many reasons I drive so carefully. I don't feel badly "cheating" the insurance company. They'll sell you a policy that won't pay off as much as the premium! In other words, you buy insurance, your car gets stolen, and they give you what they think your car is worth, even if it's less than the premium you paid. If someone is robbing you, and they ask you if you have any money they haven't found yet, and you lie to them and say no, are you wrong for lying?

#344 of 390 Sorry can't agree with you by british_rover

Mar 06, 2008 (4:36 pm)

Sorry I just can't agree with the never finance a car. It depends on your financial situation and what interest rates are doing right now.
 
Our brand is running 3.9 APR on certain CPO vehicles right now up to the 2004 MY. That is an insane rate on a four year old car so you get the bonus of buying a car that has already depreciated by half or more then half, it is under warranty for two or three years and the interest rate is well below what you can earn in a decent money market account or CD.

#345 of 390 Good advice... by lemko

Mar 07, 2008 (7:23 am)

...if all you want is an underinsured beater subcompact. I can picture our frugal pal looking a lot like the guy in the "Free Credit Report" TV commercial driving the beat-up blue Geo Metro that stalls at the stoplight as two girls in a convertible laugh at him. The only difference is he'd have a stellar credit rating.

#346 of 390 Re: 10 tips to cut car costs [joesmith2] by qbrozen

Mar 07, 2008 (9:17 am)

Replying to: joesmith2 (Mar 06, 2008 3:51 pm)
I doubt if I'll get "caught" lying about my mileage, my odometer quite working.
 
Wow! Fraud x2. A federal offense, too! Nice work!

#347 of 390 Re: 10 tips to cut car costs [qbrozen] by lemko

Mar 07, 2008 (11:00 am)

Replying to: qbrozen (Mar 07, 2008 9:17 am)
Let's go a bit further - who needs the expense of registering a car or the inconvenience of a license? Of course, there are plenty of people in Philly who forgo the expense of insurance, registration, or a license.

#348 of 390 Re: Sorry can't agree with you [british_rover] by jeffyscott

Mar 07, 2008 (1:44 pm)

Replying to: british_rover (Mar 06, 2008 4:36 pm)
Our brand is running 3.9 APR...and the interest rate is well below what you can earn in a decent money market account or CD
 
You must have missed the recent plunge in interest rates, you are pretty unlikely to earn 3.9% in those safe investments right now. My MM is down to about 3.6%. Then you would have to pay tax on whatever you do earn, so even though you could earn fairly close to 3.9%, the after-tax yield would be well below the 3.9%, that you would be paying (with after-tax dollars) on the loan.
 
That said, if somone does not have the cash, that rate would be a good deal...assuming you are not charging an inflated price for the car, to offset the discounted interest rate..

#349 of 390 Re: Sorry can't agree with you [jeffyscott] by british_rover

Mar 07, 2008 (2:39 pm)

Replying to: jeffyscott (Mar 07, 2008 1:44 pm)
There are still some places where you can get close to 3.9 percent and maybe even above it. Just checking E*Trades rates from my account and they are under 3.9 percent now but that only just happened. I am sure if you spent some time hunting you could find some slightly higher rates and if you are less risk adverse you could always find much more profitable investments that would earn enough to beat the 3.9% and pay any taxes.
 
I also doubt rates will stay this low for long. You are better off to lock in the low interest rate for 3, 4 or 5 years then hang onto your cash to put into better investments later then tying up thousands of dollars in a depreciating asset.
 
The 3.9% comes from the manufacturer as part of the CPO program so it is independent of the price of the vehicle as long as it meets the CPO guidelines.

#350 of 390 Re: Sorry can't agree with you [british_rover] by jeffyscott

Mar 07, 2008 (4:58 pm)

Replying to: british_rover (Mar 07, 2008 2:39 pm)
if you are less risk adverse you could always find much more profitable investments that would earn enough to beat the 3.9% and pay any taxes
 
You could find things that you hope will beat the 3.9%...but when you move beyond things that are essentially risk free that is comparing two different things. Not taking the 3.9% loan is a risk free 3.9% after taxes. With a combined state and federal marginal tax rate of 30%, one would have to earn about 5.6% before taxes.

Messages Page 35 of 39

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