New car or used car?

Discuss various money matters here. Loans (federal and private), scholarships, lottery winnings, or other school finance related information and queries.
Lupton Pittman
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Re: New car or used car?

Postby Lupton Pittman » Wed Apr 21, 2010 5:40 pm

Whoever said to buy a used civic and then sell it once school's over has the right idea. Hondas and Toyotas are reliable, cost little to maintain, and hold their value well. Not to start a pissing match about cars, but buying a used Audi while living on a strict budget is insane--the maintenance these cars require is frequent and expensive. And while I don't know about the very newest Fords, historically they've been junk and lose their value like crazy.

waxloaf
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Re: New car or used car?

Postby waxloaf » Wed Apr 21, 2010 5:43 pm

Agreed, anyone who thinks buying a used german car is a good move economically is nuts. German cars look and drive awesome, but are not as reliable as one might expect and cost a ton to fix. Also OP if you are mechanically inclined at all it might be worth learning some basic car maintenance, taking care of your vehicle is the best investment you can make.

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Captain Jack
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Re: New car or used car?

Postby Captain Jack » Wed Apr 21, 2010 5:53 pm

Good Credit: New car
Bad credit: Used car

astro1819
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Re: New car or used car?

Postby astro1819 » Wed Apr 21, 2010 6:00 pm

As for reliability, I chose the Fiesta in part because Ford has been getting consistently more reliable and is running with the best of them. Consumer sentiment has yet to catch up.

http://www.theoaklandpress.com/articles ... 774383.txt

astro1819
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Re: New car or used car?

Postby astro1819 » Wed Apr 21, 2010 6:05 pm

It seems that people are either saying to buy new or to get a much older japanese car (read in the $5k/100,000miles range). I still can't decide. Leasing is not an option for me.

Let me put it this way, would I be making a huge mistake if I spent an additional $10k on a brand new car (as opposed to an old one) and just took out $10k more in gradplus loans? If I had bought a car 3 years ago when I started working, I would've essentially put myself in the same situation.

waxloaf
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Re: New car or used car?

Postby waxloaf » Wed Apr 21, 2010 6:08 pm

Remember that your gradplus loan will be much more than 10k by the time you start having the means to pay it off.

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jks289
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Re: New car or used car?

Postby jks289 » Wed Apr 21, 2010 6:15 pm

Get a used Honda. I have a newish (late model, always buy used though) luxury SUV and hubs drives a 2001 Honda Civic. The Honda kicks the nicer cars ass. Awesome gas mileage and never give us any trouble. I cringe every time we have to go to the dealership and with the Honda we'll replacing the timing belt once next year (only repair ever needed) and driving it another 10 years.

Lupton Pittman
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Re: New car or used car?

Postby Lupton Pittman » Wed Apr 21, 2010 6:27 pm

Yeah a new car just isn't a good investment, period. The initial depreciation it takes is huge. If you're after the new car experience, then have you thought about buying pre-owned? A lot of the car companies sell slightly-used cars off their lots, which almost always have outstanding warranties (think 10 yr/100k miles). If that's not new enough for you, it seems like you might just be dead-set on a new car, which if that's the case, there's really no way to rationalize how it's the smartest choice.

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catharsis
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Re: New car or used car?

Postby catharsis » Wed Apr 21, 2010 6:28 pm

f0bolous wrote:if i were in your shoes, i'd probably just pay 4-5K for a decent, older model honda civic. after 3 years of law school, turn around and sell it for 3-4K.


+1 cant go wrong with Hondas and their resale value is among the best.

astro1819
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Re: New car or used car?

Postby astro1819 » Wed Apr 21, 2010 6:30 pm

waxloaf wrote:Remember that your gradplus loan will be much more than 10k by the time you start having the means to pay it off.


OK, here's another option that I've been holding back from mentioning.


What if I take an extra low-interest car loan instead of borrowing more in gradplus loans? The problem there is that I'm concerned I may hit some problems making payments when I'm on a student budget, and these loans aren't eligible for IBR or LRAP, whereas the gradplus loans are.

astro1819
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Re: New car or used car?

Postby astro1819 » Wed Apr 21, 2010 6:32 pm

Lupton Pittman wrote:Yeah a new car just isn't a good investment, period. The initial depreciation it takes is huge. If you're after the new car experience, then have you thought about buying pre-owned? A lot of the car companies sell slightly-used cars off their lots, which almost always have outstanding warranties (think 10 yr/100k miles). If that's not new enough for you, it seems like you might just be dead-set on a new car, which if that's the case, there's really no way to rationalize how it's the smartest choice.



I'm not so sure. --LinkRemoved--

Granted, they factor in higher financing for used versus new, which tips the scale in the new car's favor (and I'll be taking out the same gradplus loans for both used and new), but my point is that the conventional wisdom isn't so black and white right now.

astro1819
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Re: New car or used car?

Postby astro1819 » Wed Apr 21, 2010 6:33 pm

Lupton Pittman wrote:Yeah a new car just isn't a good investment, period. The initial depreciation it takes is huge. If you're after the new car experience, then have you thought about buying pre-owned? A lot of the car companies sell slightly-used cars off their lots, which almost always have outstanding warranties (think 10 yr/100k miles). If that's not new enough for you, it seems like you might just be dead-set on a new car, which if that's the case, there's really no way to rationalize how it's the smartest choice.


And the same can be said for certified pre-owned cars: --LinkRemoved--

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baboon309
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Re: New car or used car?

Postby baboon309 » Wed Apr 21, 2010 6:38 pm

astro1819 wrote:
waxloaf wrote:Remember that your gradplus loan will be much more than 10k by the time you start having the means to pay it off.


OK, here's another option that I've been holding back from mentioning.


What if I take an extra low-interest car loan instead of borrowing more in gradplus loans? The problem there is that I'm concerned I may hit some problems making payments when I'm on a student budget, and these loans aren't eligible for IBR or LRAP, whereas the gradplus loans are.



YOU JUST WANT A NEW CAR!!!!!!

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jks289
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Re: New car or used car?

Postby jks289 » Wed Apr 21, 2010 6:42 pm

baboon309 wrote:
astro1819 wrote:
waxloaf wrote:Remember that your gradplus loan will be much more than 10k by the time you start having the means to pay it off.


OK, here's another option that I've been holding back from mentioning.


What if I take an extra low-interest car loan instead of borrowing more in gradplus loans? The problem there is that I'm concerned I may hit some problems making payments when I'm on a student budget, and these loans aren't eligible for IBR or LRAP, whereas the gradplus loans are.



YOU JUST WANT A NEW CAR!!!!!!


Haha, this! OP the new car is a bad idea anyway you slice it. But it's your money (to pay back with interest).

Last week I have a conversation with a friend trying to justify buying an IPad with student loans. :D So, to each his own. Live like a lawyer now, live like a student later. Live like a student now, live like a lawyer later.

astro1819
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Re: New car or used car?

Postby astro1819 » Wed Apr 21, 2010 7:22 pm

baboon309 wrote:
astro1819 wrote:
waxloaf wrote:Remember that your gradplus loan will be much more than 10k by the time you start having the means to pay it off.


OK, here's another option that I've been holding back from mentioning.


What if I take an extra low-interest car loan instead of borrowing more in gradplus loans? The problem there is that I'm concerned I may hit some problems making payments when I'm on a student budget, and these loans aren't eligible for IBR or LRAP, whereas the gradplus loans are.



YOU JUST WANT A NEW CAR!!!!!!


Hahaha, OK, you got me. I admit it, though it took me a while to realize it was this simple.

Seriously though, it hasn't been my intention to drag this conversation out with my own preconceived notions and bias, but that's what happened, my apologies. I think I just need to come to terms with the fact that I can either get "more" car now if I buy new, or "less" car now if I buy used and reap the benefits of lower debt. Less car==less debt.

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Hammurabi
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Re: New car or used car?

Postby Hammurabi » Wed Apr 21, 2010 7:29 pm

Nissan Versa 2010 base price $9,990. It's not the best looking car out there, but I think its the cheapest brand new car avaible in the US. Might want to look into the option if you want to buy brand new for less $$$.

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BriaTharen
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Re: New car or used car?

Postby BriaTharen » Wed Apr 21, 2010 7:35 pm

Unless the Honda is missing an engine, between a new Ford and a pre-owned Honda, there is no contest. Definitely the Honda.

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ruleser
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Re: New car or used car?

Postby ruleser » Wed Apr 21, 2010 7:43 pm

astro1819 wrote:OK, here is the dilemma. I have approx. 20k in savings after working 3 years between undergrad and law school. I need to buy a car (currently carless). I can either:

a) Buy a new car cash (looking at the 2011 Ford Fiesta for about $16k) and increase Gradplus loans by 16k.

The new car will carry higher insurance and tax (likely attending school in Virginia, which has a property tax) but lower maintenance and gas costs. Resale value will be higher. I'll get the exact car I want. No previous owners, more dependable.

or

b) Buy a used car cash (looking at honda 3-5 year old honda civic) and increase Gradplus loans by only 7-10k.

The used car will carry lower insurance and tax, but higher/unpredictable maintenance and gas costs. More $$$ available after law school to replace the car when I graduate.

According to a fin aid officer I spoke with recently, car payments do not qualify as living expenses that justify increased GradPlus loans - don't know if that was just this school or is universal, but check it out at your school - don't assume they will increase your GradPlus to cover your car payments.

astro1819
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Re: New car or used car?

Postby astro1819 » Wed Apr 21, 2010 7:55 pm

ruleser wrote:According to a fin aid officer I spoke with recently, car payments do not qualify as living expenses that justify increased GradPlus loans - don't know if that was just this school or is universal, but check it out at your school - don't assume they will increase your GradPlus to cover your car payments.


Well, i couldn't ask them for more loans, no. But if I deplete my savings now, I will have to borrow more later. Right now I could squeak by with buying a new car based on my savings and the package schools have offered me.

astro1819
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Re: New car or used car?

Postby astro1819 » Wed Apr 21, 2010 7:57 pm

JessicaTiger wrote:Unless the Honda is missing an engine, between a new Ford and a pre-owned Honda, there is no contest. Definitely the Honda.


Man, people here do NOT like Ford. I'm not particularly fond of them, but I don't dislike them either. From the reviews I've read and Ford's recent reliability reports and the prices and options they're offering, it seems like a decent choice.

If I buy a used car, let me be clear that it will not be a Ford.

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flyingpanda
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Re: New car or used car?

Postby flyingpanda » Wed Apr 21, 2010 8:17 pm

ruleser wrote:
astro1819 wrote:OK, here is the dilemma. I have approx. 20k in savings after working 3 years between undergrad and law school. I need to buy a car (currently carless). I can either:

a) Buy a new car cash (looking at the 2011 Ford Fiesta for about $16k) and increase Gradplus loans by 16k.

The new car will carry higher insurance and tax (likely attending school in Virginia, which has a property tax) but lower maintenance and gas costs. Resale value will be higher. I'll get the exact car I want. No previous owners, more dependable.

or

b) Buy a used car cash (looking at honda 3-5 year old honda civic) and increase Gradplus loans by only 7-10k.

The used car will carry lower insurance and tax, but higher/unpredictable maintenance and gas costs. More $$$ available after law school to replace the car when I graduate.

[strike]According to a fin aid officer I spoke with recently, car payments do not qualify as living expenses that justify increased GradPlus loans - don't know if that was just this school or is universal, but check it out at your school - don't assume they will increase your GradPlus to cover your car payments.[/strike]

waxloaf
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Re: New car or used car?

Postby waxloaf » Wed Apr 21, 2010 9:46 pm

astro1819 wrote:
JessicaTiger wrote:Unless the Honda is missing an engine, between a new Ford and a pre-owned Honda, there is no contest. Definitely the Honda.


Man, people here do NOT like Ford. I'm not particularly fond of them, but I don't dislike them either. From the reviews I've read and Ford's recent reliability reports and the prices and options they're offering, it seems like a decent choice.

If I buy a used car, let me be clear that it will not be a Ford.


I don't spend much time looking around at reliability ratings, but how can they really tell how reliable a new ford will be in 10 years? If they are looking at problems for the first five years or so there should be none no matter what car you buy, but look at the 10-20 year old cars on the road and see that most are japanese, thats a good enough indicator for me.

also, if you really want a new car, you can justify it to yourself any way you want, get it if you really want it.

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kalvano
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Re: New car or used car?

Postby kalvano » Thu Apr 22, 2010 12:24 am

oberlin08 wrote:you could lease a car, pay lower monthly payments, give it up after law school, and readjust your transit situation acccording to your job situation



That's exactly what I am doing. You can lease a Sentra for $200 a month.



astro1819 wrote:Hahaha, OK, you got me. I admit it, though it took me a while to realize it was this simple.

Seriously though, it hasn't been my intention to drag this conversation out with my own preconceived notions and bias, but that's what happened, my apologies. I think I just need to come to terms with the fact that I can either get "more" car now if I buy new, or "less" car now if I buy used and reap the benefits of lower debt. Less car==less debt.



You said leasing isn't an option, but I'm curious why? It gives you security while you're in school, and takes one less hassle away.


I sold cars for years, and for a student who will have many other things to worry about, leasing is really the best option. Do a 39-month lease, no money down (all you do is buy down a payment when you do that), and don't have to worry about it while you're in school. At the end of the lease, see what the car is worth. If the payoff on the lease is more than the car is worth, hand the keys back and walk away. If the payoff is less than the car is worth, buy it from the company.

Seriously, with the cheap lease deals right now on Toyota's and Honda's, you'd be remiss to not take a good look at them.
Last edited by kalvano on Thu Apr 22, 2010 12:31 am, edited 1 time in total.

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quickquestionthanks
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Re: New car or used car?

Postby quickquestionthanks » Thu Apr 22, 2010 12:26 am

Used car, private seller. Carfax. New tires. Have your mechanic look at it.

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kn6542
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Re: New car or used car?

Postby kn6542 » Thu Apr 22, 2010 12:28 am

f0bolous wrote:if i were in your shoes, i'd probably just pay 4-5K for a decent, older model honda civic. after 3 years of law school, turn around and sell it for 3-4K.

Srsly.




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