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Started By
Message
Buying a New Truck.
Posted on 10/6/15 at 1:16 pm
Posted on 10/6/15 at 1:16 pm
I am looking to buy a new truck in the near future and I have a few questions?
1. Down Payment
The truck I am looking to purchase is going to be somewhere between $45k-$50k. I originally looking to put down $17k my dad suggested I keep my cash and put down 20% in case the truck gets totaled. After he said that I thought I may reduce my d.p. to $12k. What is best?
2. Loan duration
I originally wanted to finance this truck for 48 mos., however stretching it out to 60 would make my monthly payments more comfortable. Stretching the loan out another year will cost me an extra $1300 over the duration of the loan. Is this wise to meet a much more desirable monthly payment?
3. Who is generally the better financing option my credit union, my bank or the dealer?
4. Any negotiating tips are welcomed. I looked at the true car price and it matches my employer discount price. So I don't think there will be much wiggle room if I present my employer discount.
Thanks guys.
1. Down Payment
The truck I am looking to purchase is going to be somewhere between $45k-$50k. I originally looking to put down $17k my dad suggested I keep my cash and put down 20% in case the truck gets totaled. After he said that I thought I may reduce my d.p. to $12k. What is best?
2. Loan duration
I originally wanted to finance this truck for 48 mos., however stretching it out to 60 would make my monthly payments more comfortable. Stretching the loan out another year will cost me an extra $1300 over the duration of the loan. Is this wise to meet a much more desirable monthly payment?
3. Who is generally the better financing option my credit union, my bank or the dealer?
4. Any negotiating tips are welcomed. I looked at the true car price and it matches my employer discount price. So I don't think there will be much wiggle room if I present my employer discount.
Thanks guys.
11
Posted on 10/6/15 at 1:20 pm to LSU_Saints_Hornets
quote:
. Who is generally the better financing option my credit union, my bank or the dealer?
If you qualify for USAA, its auto loan rates are hard to beat.
ETA: $45-50K is way more than I'd ever spend on a vehicle. Can I afford it? Sure, but I'm just as happy driving a vehicle that costs 1/2 as much, and I enjoy other things much more (travel, dining, etc). There is an endless world of possibilities out there--don't get stuck on the idea of vehicle = self worth. I'd rather raft the Grand Canyon, see the Northern Lights in Alaska, or take a couple of charter fishing trips a year....
This post was edited on 10/6/15 at 1:24 pm
Posted on 10/6/15 at 1:33 pm to LSU_Saints_Hornets
keep all your cash
put zero down
finance with pedfed @ 1.49%
put zero down
finance with pedfed @ 1.49%
Posted on 10/6/15 at 1:38 pm to LSU_Saints_Hornets
Put zero down, finance it as long as you can but pay more than the monthly payment, get Gap Coverage, shop rates at credit unions and dealer, don't buy a $50k truck.
Posted on 10/6/15 at 1:49 pm to LSU_Saints_Hornets
I would finance the truck for 60 months, but plan to pay it off in 48. This way, if some unexpected expense comes up, you can always cut back your payment to the minimum due.
I bought my truck last year and put $25K down- it was more than I should have put down, but I had it to spend and it made my payments more than manageable. If I had to do it again, I'd probably stay closer to $15K and just take the higher payments.
Listen to the people that say don't spend that much money on a truck, but only you know your budget. If you have run the numbers and you're sure you can afford it, then go for it. I bought a $40K truck that I'll drive for 8-10 years, and for me, it's worth it- my job has the possibility for me to spend a couple hours on the road every day driving from courthouse to courthouse, and if I'm going to spend that much time in my car, then I want to be comfortable doing it.
1 more thing- take into account that there's a chance that while you own this truck, gas will jump back up into the $3.00+ range, so just keep that in mind when you're budgeting for gas.
I bought my truck last year and put $25K down- it was more than I should have put down, but I had it to spend and it made my payments more than manageable. If I had to do it again, I'd probably stay closer to $15K and just take the higher payments.
Listen to the people that say don't spend that much money on a truck, but only you know your budget. If you have run the numbers and you're sure you can afford it, then go for it. I bought a $40K truck that I'll drive for 8-10 years, and for me, it's worth it- my job has the possibility for me to spend a couple hours on the road every day driving from courthouse to courthouse, and if I'm going to spend that much time in my car, then I want to be comfortable doing it.
1 more thing- take into account that there's a chance that while you own this truck, gas will jump back up into the $3.00+ range, so just keep that in mind when you're budgeting for gas.
Posted on 10/6/15 at 2:07 pm to LSU_Saints_Hornets
Your total value of all of your vehicles, boats, RVs, ATVs, etc. should never exceed half of your income.
$50k is a lot to put on a depreciating asset. I'm not going to lecture you on looking for a slightly used version that someone else has eaten the depreciation on, but the vast knowledge on money matters on this board can really change your financial life.
If you are set to make this purchase, then putting 20 percent down is sufficient. If you can't get special financing from the dealer, seek out a credit union. If you have a military pedigree, USAA or NFCU's rates are hard to beat.
$50k is a lot to put on a depreciating asset. I'm not going to lecture you on looking for a slightly used version that someone else has eaten the depreciation on, but the vast knowledge on money matters on this board can really change your financial life.
If you are set to make this purchase, then putting 20 percent down is sufficient. If you can't get special financing from the dealer, seek out a credit union. If you have a military pedigree, USAA or NFCU's rates are hard to beat.
Posted on 10/6/15 at 2:09 pm to LSUGUMBO
quote:
I would finance the truck for 60 months, but plan to pay it off in 48. This way, if some unexpected expense comes up, you can always cut back your payment to the minimum due.
I bought my truck last year and put $25K down- it was more than I should have put down, but I had it to spend and it made my payments more than manageable. If I had to do it again, I'd probably stay closer to $15K and just take the higher payments.
Listen to the people that say don't spend that much money on a truck, but only you know your budget. If you have run the numbers and you're sure you can afford it, then go for it. I bought a $40K truck that I'll drive for 8-10 years, and for me, it's worth it- my job has the possibility for me to spend a couple hours on the road every day driving from courthouse to courthouse, and if I'm going to spend that much time in my car, then I want to be comfortable doing it.
1 more thing- take into account that there's a chance that while you own this truck, gas will jump back up into the $3.00+ range, so just keep that in mind when you're budgeting for gas
This guy gets it.
Dont listen to all the people that tell you how much to spend on a vehicle. Get what makes you happy. As long as you budget for this expense and can comfortably afford it, then get it. Personally, I would never spend that much, but I also realize each person values vehicles differently.
With rates as low as they are, your money is better spent investing.
This post was edited on 10/6/15 at 2:11 pm
Posted on 10/6/15 at 2:15 pm to Delacroix
quote:
Get what makes you happy.
Sadly, this is the prevailing nature of the consumer. Get what makes you happy, right now, damn the consequences.
Dr. Thomas Stanley's "Millionaire Next Door" should be required reading to receive a college diploma.
Posted on 10/6/15 at 2:19 pm to anc
quote:
Sadly, this is the prevailing nature of the consumer. Get what makes you happy, right now, damn the consequences.
Dr. Thomas Stanley's "Millionaire Next Door" should be required reading to receive a college diploma.
I agree with you. Which is why I said if you budget for it and can afford it comfortably.
If he has his retirement and savings goals taken care of, and still has enough to easily afford that payment, then whats the problem with getting something he wants?
Posted on 10/6/15 at 2:22 pm to anc
Thanks guys.
I know people usually don't agree with those who want to spend that kind of money on a vehicle, but this is a gift to myself. I can afford this vehicle, I won't be car poor.
Zero percent seems ridiculous to me. Why would I want to pay nearly a $1k a month on a vehicle?
I will look into USAA. Thanks
I know people usually don't agree with those who want to spend that kind of money on a vehicle, but this is a gift to myself. I can afford this vehicle, I won't be car poor.
Zero percent seems ridiculous to me. Why would I want to pay nearly a $1k a month on a vehicle?
I will look into USAA. Thanks
Posted on 10/6/15 at 2:23 pm to Delacroix
quote:
If he has his retirement and savings goals taken care of, and still has enough to easily afford that payment, then whats the problem with getting something he wants?
Nothing. But the fact that he stated he would rather take the loan out for 60 months rather than 48 to be more comfortable is a tell that this is the top of his budget.
If I'm going to stretch my budget, its going to be on something that isn't going to drop in value by 40 percent in 2 years. I answered his questions above.
Posted on 10/6/15 at 2:29 pm to Delacroix
quote:
I agree with you. Which is why I said if you budget for it and can afford it comfortably.
If he has his retirement and savings goals taken care of, and still has enough to easily afford that payment, then whats the problem with getting something he wants?
My retirement is looking good.
My savings is damn strong also. That's why I want to treat myself to this truck. I sacrificed a lot to get my finances where they are today. While all my other friends went on multiple exotic vacations a year I stayed and home and saved my coins. While they went get these luxury apartments in the warehouse district I moved to Thibodaux and live in my grandparents old shotgun house rent free. I would like to grant myself something nice for all my discipline.
Posted on 10/6/15 at 2:34 pm to anc
quote:
But the fact that he stated he would rather take the loan out for 60 months rather than 48 to be more comfortable is a tell that this is the top of his budget.
It is not at the top of my budget, it is just this is something new for me. Meeting a financial obligation not named "rent" that is close to $700 a month is uncharted waters for me. I only use 1/3 of my monthly income on expenses the rest is all mine/ours (my new wife).
Posted on 10/6/15 at 2:53 pm to Delacroix
quote:
If he has his retirement and savings goals taken care of, and still has enough to easily afford that payment, then whats the problem with getting something he wants?
I agree with this...but I also know plenty of middle class people who see "big experiences" or serious travel as an unattainable goal, yet they plop down $500-800/mo on vehicle expenses (note/gas/insurance). Sure, I want to be comfortable during my 40 mi daily commute, but I also want to see the world & experience things well before my retirement years. Too many Americans try to buy happiness with nice things, rather than seeking self-knowledge through broad experiences. In other words, think more deeply about what makes you happy...don't just assume that new & more expensive stuff will do the trick.
Posted on 10/6/15 at 3:01 pm to hungryone
quote:
I agree with this...but I also know plenty of middle class people who see "big experiences" or serious travel as an unattainable goal, yet they plop down $500-800/mo on vehicle expenses (note/gas/insurance). Sure, I want to be comfortable during my 40 mi daily commute, but I also want to see the world & experience things well before my retirement years. Too many Americans try to buy happiness with nice things, rather than seeking self-knowledge through broad experiences. In other words, think more deeply about what makes you happy...don't just assume that new & more expensive stuff will do the trick.
Personally,I value experiences higher than material things, which is why I would sacrifice a spending more on a vehicle for a trip abroad. However, I cant knock someone who sees it the other way around. Different strokes
Posted on 10/6/15 at 3:08 pm to LSU_Saints_Hornets
quote:
however stretching it out to 60 would make my monthly payments more comfortable
quote:
I only use 1/3 of my monthly income on expenses
Posted on 10/6/15 at 3:23 pm to hungryone
quote:
Too many Americans try to buy happiness with nice things, rather than seeking self-knowledge through broad experiences. In other words, think more deeply about what makes you happy...don't just assume that new & more expensive stuff will do the trick.
This is great advice you just opened my eyes to something. You really got me thinking about scaling down this purchase.
Posted on 10/6/15 at 3:34 pm to LSU_Saints_Hornets
quote:Because you'd still have $17k in your bank account?
Zero percent seems ridiculous to me. Why would I want to pay nearly a $1k a month on a vehicle?
Posted on 10/6/15 at 3:39 pm to LSU_Saints_Hornets
When I buy my next vehicle I will more than likely finance a $20k truck. By the time I sell that truck I will be able to pay cash for my $50k truck.
That being said, if you can be comfortable in your finances spending that much money on a vehicle then do it. I would try to get something a little cheaper and the difference between your $50k payment and your $25k payment can start to grow to pay cash for your $60k truck in 8 years.
That being said, if you can be comfortable in your finances spending that much money on a vehicle then do it. I would try to get something a little cheaper and the difference between your $50k payment and your $25k payment can start to grow to pay cash for your $60k truck in 8 years.
Posted on 10/6/15 at 3:41 pm to LSU_Saints_Hornets
quote:
This is great advice you just opened my eyes to something. You really got me thinking about scaling down this purchase.
Glad you're thinking. Are those grandparents still living? A weekend trip with them--to a place they've always wanted to visit, or a place they remember fondly--is worth more than any truck. Ditto for your dad--a charter fishing trip, or a guided hunt, or whatever you guys enjoy together. Do the math on a cheaper ride and see how much would be left over to do cool things. I see so many "car poor" people riding around in Tahoes and Navigators who've never seen Paris, or NYC, or the Sierra Nevadas. Or Big Sur. Or the FL Keys...
We create the life we want through each one of our choices. Keep living in that shotgun and go see the world....anyone can buy a truck, LOL. Stuff doesn't make you an interesting person, experiences do.
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