Last post on Dec 01, 2013 at 1:19 PM
You are in the Prices Paid - Buying & Leasing Experiences
What is this discussion about?
Subaru Forester, Wagon, SUV
#2577 of 3625 Re: The Worst Dealership Experience-Dunning Subaru-Ann Arbor [rockp]
Sep 03, 2009 (10:08 am)
Wow, I am so sorry to hear about your experience. I hope to never hear of another experience similar to that happen to anyone else. =(
On another note, I'd like to get everyone's opinions on a deal that I am trying to work out with Subaru Puente Hills.
2010 Subaru Forester 2.5X, Newport Blue, PZEV.
Sale Price: $21604
3.9% for 60 mos.
I am trading in a 2008 Impreza Hatchback, which is why the sales manager won't settle for anything less than invoice.
I still owe $15091 on the Impreza and they will buy it for $12500.
Should I do it or haggle for more? If so, what should I ask for?
#2578 of 3625 Re: The Worst Dealership Experience-Dunning Subaru-Ann Arbor [gigoypotpot]
Sep 03, 2009 (10:34 am)
My practical side says wait until you're not $2500 upside down on that Impreza.
My fun side says jump on that 3.9% and the new Forester, which I much prefer anyway.
Just make sure you can afford the $2500 hit. I would put at least that much down so you're not carrying over the debt.
#2579 of 3625 Re: The Worst Dealership Experience-Dunning Subaru-Ann Arbor [ateixeira]
Sep 03, 2009 (10:48 am)
I know what you mean, it's always my practical and wild side battling it out. I plan on putting in at least $3k down at this point to offset the $2500. If I see it practical or necessary, I might put down more just to keep the payments low.
So, would you also say that $21604 is a pretty decent price for a 2010 PZEV? It comes with the protection group 1 package, I believe, which includes the front bumper under cover and rear bumper cover.
On Edmunds, invoice with those options is $21700+.
#2580 of 3625 Re: The Worst Dealership Experience-Dunning Subaru-Ann Arbor [gigoypotpot]
Sep 03, 2009 (10:50 am)
Beating invoice is doing very well right now, given C4C and a record-breaking August for Subaru has supply extremely low. Jump on it.
#2581 of 3625 Re: The Worst Dealership Experience-Dunning Subaru-Ann Arbor [gigoypotpot]
Sep 03, 2009 (10:58 am)
You may be upside down on the trade value, but have you considered selling it private party? Perhaps you can get a bite soon and closer to your currently owed amount. Invoice at 3.9 percent is great. At the end of the loan, that is better than me getting $300 under invoice at my interest rate (which will be 4.74%). If you are looking at a 36-month loan, your monthly payments are going to be quite high. Were you to roll the $2500 loss into the Forester, you would likely be "right side up" on it within 12-18 months or so given the high payments and low interest rate combined with the residual value on the Forester.
I think this dealer is offering you a reasonable price, so the only question now is what you want to do with that Impreza. It is always painful (financially) to keep a car for a short period of time.
#2583 of 3625 Re: The Worst Dealership Experience-Dunning Subaru-Ann Arbor [xwesx]
Sep 03, 2009 (11:35 am)
Thank you, ateixeira and xwesx for your quick responses. I have considered selling it privately with my payoff amount as asking price. In fact, I have posted an ad for it on Craigslist a week ago. However, I am finding that most people try to negotiate the price, which is understandable.
I am actually also planning on paying Carmax a visit to see how much they would be willing to buy the Impreza.
xwesx, I am planning on doing a 60mos loan, would it still come out as "right side up" then?
#2584 of 3625 Re: The Worst Dealership Experience-Dunning Subaru-Ann Arbor [gigoypotpot]
Sep 03, 2009 (12:09 pm)
Sorry, I don't know why I thought it was 36 months! Well, here's the thing....
Invoice on a Forester is $1,500 below MSRP. So, if you are $2500 upside down on the trade in and put nothing down on the new car, you will be financing at $1000 over MSRP. If you are still getting the financing below 4%, that's a great start, but it is risky because the value of the car when driven off the lot is, at BEST, going to be invoice. So, if some bozo comes along and totals the car as you drive away, you are now in the hole $2500+! There is GAP insurance, but how much will the financier charge for that? My local credit union charges $300, which is pretty good, but I have had dealers offer it to me for around $1000.
So, lets say the car loses 10% of its original value annually. I know it is simplistic, but bear with me.....
Say you do not put anything down. You would pay $24,195 on the car (assuming no other fees, etc., rolled into the loan amount). This is because the dealer would pay off the current loan on the trade-in, and then charge you the difference between trade-in value and owed value.
So, for 60 months, you would pay 444.50 on the new car at 3.9 percent interest. Your total payments on the car, after 60 months, will be $26,669.80 with $24,195 going toward principal and $2,474.80 going to interest.
After one year, you will have paid $5,333.96 on the car and still owe $19,725.31. But, the car lost 10% of its value from invoice (21,450), so the current value of the car after one year is $19,305. If you follow the numbers, you will be "right side up" probably at some point during the second year of ownership (assuming market value, not trade in value). I suspect that the car's devaluation slows after the first year, but 10% over the first year is pretty realistic.
I dunno, but I would not want to be upside down for that long. I am lucky because my market values Subaru vehicles highly. When I buy at invoice, even if I were to put nothing down on them (which I don't do), I would not be upside down.
You can pretty much figure that any time you fully finance a vehicle and try to trade it in during the first two, possibly three, years, you will be upside down. As for private party sales, if you have the funds ($500 to $1000) on hand to pay off the balance of a loan, why not negotiate a little with prospective buyers? You will both come out ahead. If you roll that $2500 in to the loan amount, you are not only making the car riskier to own, but you will be paying much more (plus interest!) in the end.....
#2585 of 3625 Re: The Worst Dealership Experience-Dunning Subaru-Ann Arbor [xwesx]
Sep 03, 2009 (12:45 pm)
The purchase of anything is a gamble when you look at the numbers and hope to make money or even break even if and when you sell it !
I have never purchased a vehicle with the idea of what its going to be worth when I sell/trade it in. I look at vehicles as to if it will do what I want for the time I want and be safe and hopefully not cost so much that I can still afford a trip thur the drive thur a few times a month !
Some of you sound like you figure out the numbers to the last penny, that would drive me up a tree to even consider ! Today we have people crying that their homes and vehicles are not worth what they believed they should be worth today, HEY thats the chnace you take when buying anything and some win - some lose !
If you want a new car and can afford the new car then get a new car, if your worried what it will be worth as a trade in in say 5 years...............dont get a new car, get a bottle of fine Kentucky whiskey and go sit under a tree and watch life go by as you will never be happy again !
#2586 of 3625 Re: The Worst Dealership Experience-Dunning Subaru-Ann Arbor [xwesx]
Sep 03, 2009 (12:56 pm)
Wow! Thank you so much for taking the time out to explain the whole shebang to me! =) I realllllyyyyyy appreciate it!
I do see what you are saying and will think about everything thoroughly before making a final decision. I've thought about the possibility of selling my car privately for $14k and cover the extra $1k and pay off the loan. I just was not sure (at that time) if that made sense and/or if it was practical and financially-wise to do that.
Again, thank you and I will keep you posted! =)