I honestly don't think I got screwed over on the loan alot of people are saying I made a horrible decision but I don't think I did. When I said I had a little over 12k in the savings I had close to 15 and ended up puttting down 10 just so I can have a little more in case something does happen.
My credit isn't that bad credit unions report your payments to the credit bureaus I can easily afford to pay my car payment and insurance in a week worth of tips and still manage to my other bills and save money. If anything I'm gonna be able to rebuild my credit get a lower rate next year and pay end up paying less interest. I guess time will tell I'm not worried about maintaining my weekend cruiser

 

You know he bought it so he will own it at age 32. That isn't so bad. Especially if that payment comes out of his transportation, hobby, entertainment and fun money for a while. It might be motivation to work harder.
Perhaps not the most prudent decision but okay.
If he doesn't have children then life is cheep.

So if you did buy it then How do you like it?

 

Well, he also has a Lexus, meaning his net worth is gonna be a little higher than stated.

Like I said though, I'm not claiming he made a good financial decision by buying the car. You also have to remember that having very little credit and a huge down payment is very different than having crappy credit.

The first implies "this guy hasn't ever borrowed money, but he has so much saved up that he's probably low risk" vs "this guy has screwed up every time someone loaned him money."

I typed out some more to try to justify that I'm in a very safe financial state, but in all honesty there's no point in posting it.

I would assume that both you and I own our cars outright, and have very little if anything left on our mortgage. However, I think the OP can turn this into a positive especially if he gets a second job to boost his income, and pays off the loan early to cut down on the finance charge.

 

Lemme cut in my thoughts; it’s gonna sound like an itemized retort/rebuttal/reply, but there are so many different tangential points to make I think they need separated responses. No offense meant whatsoever; this is a dead horse, but there’s some things that can still be learned from your decision. And some for me, too.

I might not classify the decision as ‘horrible’; in my own experience and opinion, it was ‘bad’ for sure and ‘impatient’ and affects your long-term future--definitely. But you can recover from it so long as nothing changes—no medical emergencies that cost extensive time off work (a weekend pick-up game causing a serious knee injury could do that), hopefully for you the economy stays the same over the next 4 years and folks continue to eat out—because that directly affects your line of work.

At least there’s that; you have a strong $4,000+ still accessible. Two things struck me as odd in your details; I’ll get to the other shortly… first you said you had 12k for the car; after some "don't do its" by the more conservative writers, you divulge that . After more “don’t” writers, you said that the “little over 12k” was closer to 15. I dunno; I would have initially described almost 15k as “a little over 14k” not 12. Maybe you’re even more conservative than I. If so, keep that sense of scale.


Something I never understood from your description; maybe it’s because my own experience with a collection agency referral and credit bureaus was much different.

You said you were 20 when “they” black-marked your credit rating. How bad did it get? I mean, eight years later you’re at 600; I would have thought it would have taken less than 6 years to improve the rating and tha one could “wipe out” bad history so’s to be above ~675 in eight years. I never knew what my rating was when I had a bill roll over to a collection company but 4 years later when we applied for a mortgage we were graded as “excellent” for whatever that’s worth. It seems to me that an 8-year credit rating of 600 or less would be a hard “stain” to recover from.


Earlier in another post you said , What kind of “full coverage” was that? Minimum amounts for Liability, Collision, and Comprehensive, or $500,000 each across the board with an Agreed Value clause? Does it include an umbrella clause/policy?

$45/month for “true” full coverage sounds dirt cheap for a 28 year old male in a Corvette with a 600 rating. (Maybe I should tell my nephews to hook up with USAA. That’s why I ask for details on your full coverage.)


Your rationale here is the reason I asked earlier about your credit rating over the last 8 years (from that incident when you were 20). I don’t see how a year’s history can change your previous 8 years so drastically unless the first 8 years made phenomenal credit rating gains, but I never knew my own ‘low’ score.

That’s not the reason those of us who are dubious were against the idea—anyone with a moderate income can maintain payments on 2 vehicles; down here in Miss’ippi most folks still classify $25,000 annual gross as barely above the poverty line—but they’ll say they’re doin’ fine. Most families here have 2 cars; I’m sure some even carry full coverage (no insult meant here) on both—you can find 2-car families in any ghetto (no insult meant here, either)—their surroundings just shows how badly their “priorities” have limited their lifestyles and possibly their futures. The newer the car, the more likely it is that they have some auto insurance; but what financial plans do they have to make progress out of their current situation—and how does a budget focused on maintaining 2 vehicles fit into their plan? THAT’S the long-term picture we were trying to tell you.

I hope to learn some things from your answers. Thank you.

 

The horse is dead.


The deed is done.

 

Lets see buy new $55.000 plus fees..4 years later worth 35..hmm who got screwed ?

 

If I was buying things I couldn't afford I wouldn't have managed to save what I have

 

Any collection older than 7 years should come off your credit report. Foreclosures and bankruptcies can stay for 10 years. You are allowed a free credit report each year from the 3 major credit report agencies. Anything older than 7 years except for above mentioned items can be wiped clean. You can challenge any item on the credit report and the agencies have 30 days to respond or item must be removed. This is how most of the companies that advertise that they can clean up your credit usually do it. You can do it yourself. Never start a dialog with a collection agencies unless you intend to pay the delinquent item as a new 7 year cycle starts from first contact by either party.
annualcreditreport.com

 

At 28, to be on track, you should have minimum one years income in savings. Just sayin. I have no doubt that you will learn the hard way. Good luck.

 

That does work with almost any car. As a rule, cars are not investments.
My wife's Mercury was $30K new and she bought it used three years old for $7000. Rarely do you get your money back buying a new car. Unless it's a Ford GT or Ferrari.

 

Alot of people are talking about the car depreciation I don't think my car will depreciate as much over time I've seen alot of 50th AE similar to mine with low mileage in the 24-30K range

 

There's a lot of things we SHOULD do financially, but for most it just doesn't work out that way. I've never had anywhere close to a year's worth of salary in savings, I've always financed my vehicle purchases, and I will be retiring in a little over 2.5 years with ZERO debt...it's possible to live life and still be responsible about it...

 

Your C5 has already gone through the bulk of its depreciation...it should pretty much level out now...

 

Most people that are not fiscally responsible do not end up like you. I know a bunch of them. Buying a $20K Vette at 28, making $30K a year while renting and having little savings is a horrible move no matter how you look at it.
I have beat this horse way too much. I am out of here.

 

Personal finance is personal.
How to finance a car is just that.