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Percentage of monthly income spent on a car?

390 messages,  Last post on Mar 21, 2009 at 5:50 PM

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What is this discussion about? Car Financing


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#349 of 390
Re: Sorry can't agree with you [jeffyscott] by british_rover
Mar 07, 2008 (1:39 pm)
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Replying to: jeffyscott (Mar 07, 2008 12:44 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 (3:58 pm)
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Replying to: british_rover (Mar 07, 2008 1:39 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.
#351 of 390
Re: 10 tips to cut car costs [joesmith2] by mattandi
Mar 07, 2008 (4:03 pm)
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Replying to: joesmith2 (Mar 06, 2008 2:51 pm)

Your advice was to commit fraud to save a few bucks. You deserved some flack. Now you reveal even more fraud to cover your original lie.
 
You don't like insurance companies. Fine.
 
I don't like lairs.
#353 of 390
Re: 10 tips to cut car costs [joesmith2] by jeffyscott
Mar 08, 2008 (5:54 am)
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Replying to: joesmith2 (Mar 06, 2008 2:51 pm)

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.
 
Not sure what this is supposed to mean . That is exactly what an insurance company promises...that they will give you the actual cash value of your car if it is stolen. The price of this protection is the premium paid for "comprehensive". If you don't like the price, you don't have to buy that coverage and you take on the risk of loss yourself.
 
The reality is you are not stealing from the insurance company, you are stealing from all the honest policy holders. We have to pay higher premiums to cover the cost of fraud by others.
#354 of 390
Go ahead, kick me off your lame forum by joesmith2
Mar 08, 2008 (6:20 am)
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I wonder how long this post is going to last? If I do want to post, it takes me a whole 5 miuntes to create a new id, along with new email address. And don't bother flagging my IP address, it changes everytime I log on.
 
I've been nice. But if you make car payments, you're a fool. And part of the reason the country is in a credit crisis.
#357 of 390
Re: Go ahead, kick me off your lame forum [joesmith2] by qbrozen
Mar 08, 2008 (12:42 pm)
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Replying to: joesmith2 (Mar 08, 2008 6:20 am)

Yeah, you're right. I'm a fool for paying 0.75% interest on my wife's car for the past 2.5 years while my money market has been giving me 4.5%. Thank you so much for showing me the light.
#358 of 390
Paying .75% interest??? by joesmith2
Mar 09, 2008 (9:32 am)
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Replying to: qbrozen (Mar 08, 2008 12:42 pm)

First, I apologize for calling anyone a fool, that was harsh.
 
Loans come from banks. Banks pay interest on deposits, and make loans. Don't they have to charge more for loans than they pay depositers in order to make a profit? I don't know about anyone's situation, but I got on the Mercury web site and looked at their special offers. One offer was $5500 cash back, or .9% interest for 60 months with 10% down. I made a spreadsheet, and did some figuring. The payment on a 60 month loan for the financed amount (26095 for a Grand Marquis LS) works out to be $437.81. If instead you take the $5500 cash back, and apply it to the down payment, and finance the rest for 60 months at 10.57 %, your payments are the same, $437.81.
 
In the case of the Mercury Grand Marquis, your not getting .9% interest, you're getting 10.57% interest. If your investments are making less than 10.57% interest, you're better off paying cash. And don't forget you have to pay income tax on the interest you earn.

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