| Author | Message | ||
| V.Z. (Ama328)
Junior Member Username: Ama328 Post Number: 151 Registered: 11-2002 |
well, after delivering my diatribe about financing via credit cards(still think it can work under specific circumstances), i reread your original post and think you oughta put this baby on hold, and here's why: * financing oughta be a way to lock in a good deal if before you have all the ca$h to do the deal. It should *not* be a way of getting into sumpin' you can't/shouldn't afford. * if you buy 'over the top', you're gonna be REALLY antsy when you wanna take the new toy out on the road; too busy sweatin' the bucks to enjoy the toy. * generally speaking, cash is nice, debt is not(at least, on non-appreciating assets). * with very few exceptions, another 'deal' is gonna come along, and if you think not, then maybe do financing, but only if you've worked out the numbers to pay it off quickly. * learn to do the maintenance yourself, or allocate enuf $$ to pay someone decent to do the job. Thinkin' about buying a cheap Fcar next year, and if i do, in fact, do the deal, i'll probably pay cash or use financing only if the right deal pops up before i have all of the cash. | ||
| P. Thomas (Ferrari_fanatic)
Member Username: Ferrari_fanatic Post Number: 406 Registered: 4-2003 |
Here is a synopsis: The thread started off as question regarding where to find financing. Then it took a turn and a debate started over(as it always does, over): IF you should finance a toy. There were radically different views backed by personal opinions. Many shared their investment stratagies in hope to sway others. The buyers that paid cash, felt as if they were doing the "right" thing while others were extending themselves, and not waiting for that deferred gratification. My only point at that juncture was: does paying for an f-car in cash make you a more astute investor? No, because one could argue that if you have the money parked somewhere else, then WHY did you move it out of an investment to a depreciating asset?? From an investors stand point, it is hypacritical, as the both COST $$$.Others (pro-financing) stated that were getting 6-10% ROI on another investment so why not borrower at 5%? Makes sense to me. Then someone offered information on credit scoring. Finally, someone chimed in and said that installment loans (ie car loans) do not amortize the same as revolving lines. He submitted a suggestion to look at the advatages of financing a car using your credit card?? Some people will have their money out live them, thus giving it all to their heirs to spend (maybe on an f-car that YOU always wanted). Others, will be 67 years old, waiting for their Soc. Sec Payement of $1,700 and will need to finance a 10 cent cup of coffee. Most will fall somewhere in between. I am not passing judement on anyone's decisions (just commenting on another perspective), we all made the decision to purchase, maintain, and ENJOY our cars . So let's live the passion! | ||
| R Leander (Mastertrust)
New member Username: Mastertrust Post Number: 4 Registered: 9-2002 |
This entire conversation is confusing. Since when did obtaining a Ferrari (or any toy) have much to do with sound financial logic? If these decisions were driven completely (or even significantly) by financial considerations we'd be looking for the lowest cost per mile decision, factoring in acquistion costs, fuel, maintance, registration and taxes, insurance and disposition expense. Given how many miles most of us put on our F cars, none of them would meet that requirement. My advice, obtain something that will be fun and enjoy it, because tomorrow the big one might just hit! Cheers | ||
| R Leander (Mastertrust)
New member Username: Mastertrust Post Number: 3 Registered: 9-2002 |
P. thomas said: "The Federal Reserve Board controls Fiscal (taxation and expenditure) and Monetary policies (sets discount rate and controls money supply)" That will come as a HUGE shock to Congress, which by way of the US Constitution is vested with responsibility for Fiscal Policy (tax and spend) and Monetary Policy. It is true that in the Federal Reserve Act of 1913 congress delegated responsibility for most of the facets of MONETARY Policy to the Federal Reserve Board (retaining oversite responsibility for congress) but the right to tax and spend (FISCAL) is the most prized possesion of an elected official, extremely unlikely to ever been delegated. | ||
| Ben Cannon (Artherd)
Member Username: Artherd Post Number: 441 Registered: 6-2002 |
"You long for tommorow, living each day as your last" -Brian Adams, 'Into the Fire' I'm split, I agree with points made by both sides. One thing I know for sure. I've spent my entire life trying to get the most for my money/effort/time that I can. And by 'most' I mean most enjoyment  I have some lofty goals and projects I want to see come out of my head and into fruition, so I guess; a 308 I would probally buy with cash, just for the sheer great feeling of that drive home. Don't loose more than a set of tires on it either way, and I get to say 'fuk it' An F50, I would finance and roll the figures around to maximize the gain from moving the $ around. And I'd track the car and forget about it. I wouldn't buy either one untill I could come close to the *capability* to pay cash though. Maybe that's even too blanket. No plans for kids, so I don't care if I die with $1bil in debt. One thing is for sure, I intend to die withought a penny in the bank, and a lifetime of giving f-car induced smiles to my friends and loved ones <and> along the way! Best! Ben. | ||
| Mark Lambert (Mlambert890)
Junior Member Username: Mlambert890 Post Number: 92 Registered: 4-2002 |
If everyone waited until they could pay cash for everything with the exception of appreciating assets (basically only real estate or, potentially, precious metals), there would be no economy. Even a fairly basic car is at least $20k these days and the median household income in the US is like $45k GROSS. Accounting for taxes, housing, cleaning, commuting, eating, clothing and utilities, that would mean that the median American family would probably need to wait about 4 years before being able to afford to buy a basic, low end, car in cash. If they financed it, it would probably take the same 4 years, but they will have paid annual interest of around 5-7% per year (assuming no 0% financing stuff). Essentially, they would be "wasting" 5-7% per year for the privilege of being able to use the car, not maintain an old car (kind of have to assume they'd have a clunker while waiting to buy the new one), and hold onto their cash. If they hit a huge patch of bad luck, they could always dump the financed car at a loss and get out of the note. In the end, even at the absolute worst, it's not going to be a massive difference. The only caveat I see is that a Ferrari is possibly a special case due to the huge downside potential as a result of the insane maintenance costs. | ||
| RockStar (Remix)
New member Username: Remix Post Number: 34 Registered: 3-2003 |
Gotta agree here with Modman. Great points - they're just cars in the end and none of us can avoid the unavoidable: death. If I had to choose, I'd live in a trailer and drive a nice car, but that's just me. Luckily I get to have a little nicety in my life, but if the choice were there I'd live in a cardboard box instead. Do what makes you happy and don't stress. All these posessions and stacks of cash won't mean squat when you're on your deathbead - they're just something for your heirs to fight over anyway. We're all going to die, some of us sooner, some of us later. The big gamble is when. Enjoy yourself. BTW, you won't owe anyone a dime after you die. It's not your problem anymore. REMIX | ||
| Sunny Garofalo (Jaguarxj6)
Member Username: Jaguarxj6 Post Number: 593 Registered: 2-2003 |
Don V and Frank, I agree. I'm ok with paying $3-5k on maintenance, I'm in that range already for my daily driver at 20k miles/year. If you have to ask, then you don't understand is all too true. If it was $1000/mo I'd still do it and not lament the waste because it allows me to obtain what I want the most. Sunny | ||
| Frank Parker (Parkerfe)
Intermediate Member Username: Parkerfe Post Number: 2456 Registered: 9-2001 |
Jim, your profile indicates that you already have four Ferraris including a 355? But to respond to your post, as the old Harley saying goes, "if you have to ask, you wouldn't understand " . I think that applies to Ferrari ownership as well. While not the fastest out there, nor the most reliable or best handling, there is "something" about a Ferrari that no other manufacturer has been able to copy so far. | ||
| jim navarro (Jplotus)
New member Username: Jplotus Post Number: 13 Registered: 5-2003 |
996 Twin turbo bullet proof. I was considering an additional car such as a 355 ferrari but when I realized that the service cost were going to be in the 3-5k per year it made no sense. I just did my 02 porsche 15k service 650.00 and the 30k service is also 650.00. It is crazy to charge 6500.00 for a 30k service. You would think that ferrari would redesign the cars belt locations. I have 420 h.p. 0-60 3.9 seconds and i am eating all my freinds ferraris on the track. So before you drop the 100k for a 4 year old 355 think about an 02 twin turbo for the same 100k with a 50,000 mile warranty. Just my 2 cents worth | ||
| Modified348ts (Modman)
Member Username: Modman Post Number: 633 Registered: 11-2001 |
Financing a car can be great if it's a new Ferrari, you will profit off of it and keep your money in good investments. Also I'd rather die with a huge debt left behind then to die with millions of unused dollars you worked hard for, heck life is too short to think of long term investments. I'm sure there a few short timers here in that same boat, I believe in doing what pleases you but plan it carefully though. Heck by the time I had to pay cash for a high dollar car the car would be so old I wouldn't want to buy it by the time I'm ready and by the time I'm ready the car prices just gets higher and I'm just chasing after something that just would not be worth going after any more, damn it's just transportation. Remember when a new Ferrari was around 60K in the 80's? now the prices of new cars are outrageous. I'm not rich but at least I can sample what life has to offer for me and I still don't have any grey hairs either. | ||
| Don Vollum (Donv)
Junior Member Username: Donv Post Number: 105 Registered: 1-2002 |
When you are talking about new cars, which are depreciating assets, I think I have to side with the guys who say finance. However, when talking about vintage cars, especially high-dollar cars, you need to look at them as an asset class. Also, you need to look at what else you could be doing with the money. If, in early 2000, I had sold some stocks and bought a Lusso, I would be *way* ahead of holding the stocks and financing the Lusso. And I'd be even more ahead of just holding the stocks and not doing anything! OTOH, if you have a risk-free investment yielding 8%, and you can finance at 5%, obviously financing makes sense. If your money is in volative assets (i.e. stocks and bonds, or to a lesser extent real estate), then a high-dollar vintage car may have less volatility. Furthermore, there is some theoretical potential as an inflation hedge. Note that being a true car guy, I am excluding all cost of maintenance and restoration from the above! | ||
| V.Z. (Ama328)
Junior Member Username: Ama328 Post Number: 143 Registered: 11-2002 |
oh, and btw, ALL cards do NOT have sky high cash advance fees & interest rates, just most of 'em do...is still better to charge it as purchase, but in some cases, cash advance fees just ain't that high...gotta look for 'em, but they're out there. | ||
| V.Z. (Ama328)
Junior Member Username: Ama328 Post Number: 142 Registered: 11-2002 |
well, i knoweded i'd get beat up over my post, so no surprise there yes, i'm well aware of all of the drawbacks, but just wanted to point out that under the *right* circumstances, one might be able to pull this off. As to cc rates *always* being higher than conventional auto loan rates, go dig thru the credit boards url i listed; you'll find out that there are some deals out there that won't zing you bigtime on the cash advance fees, and won't charge thru the roof on interest. PLUS, if bought thru a dealer, it *might* be possible to put some/most/all of this on the ol' card(dealer might choke on this one, but i believe i remember reading that visa/mc/amex contract with dealer typically specified all biz transacted may be done with a card, not just biz under some arbitrary limit the dealer specifies). You might even be able to get some airline miles, too <gasp> Anybody tried to get a loan recently on a late 1980's Fcar ? No problem with 50% down, but a lot of banks just don't wanna mess with this stuff. Maybe i shoulda been more specific on the 'you pay interest first' comments. Depending upon the terms of the card you use, the monthly payments *may* incorporate paying more principal early in the loan than with a conventional loan. Does this mean you can still go conventional and pay extra every month? Of course you can. I just wanted to point out that one should examine & compare the exact terms here. I'm not suggesting one go 'max out da card' to get the hot rod, then end up in BK court 3 months later... Just another option, boys & girls, just another option. | ||
| P. Thomas (Ferrari_fanatic)
Member Username: Ferrari_fanatic Post Number: 388 Registered: 4-2003 |
One last note. VZ, the interst rate on a CASH ADVANCE is significantly higher than on a purhase. So if someone took a cash advance to pay a private party then the rate would be significantly higher (no where near the fixed 5-6% rate that they could get on a car loan). Are you suggesting that they purchase from a dealer with their (3-5) credit cards?? When the dealer was done laughing their ass off, they would be pretty peeved as they have to pay their bank a 1-3% processing fee. That is more than nominal when you consider the price of an f-car. | ||
| P. Thomas (Ferrari_fanatic)
Member Username: Ferrari_fanatic Post Number: 386 Registered: 4-2003 |
Oh my gosh VZ you have absolutly lost it. ANY unsecured loan (credit card) will have a higher interest rate than a secured loan (ie, mortgage or car) as there is more risk to the creditor (no colleteral). Granted there are some credit cards with a teaser rate for X amount of months (usually pretty short period), then go to an adjustable. Second, most credit cards are tied to the Prime Rate (aka, the index) plus a margin above prime. Prime is low right now at 4.25%. The Federal Reserve Board controls Fiscal (taxation and expenditure) and Monetary policies (sets discount rate and controls money supply). Although the Prime Rate is low right now, it is also one of the most volitale indices. The Fed controls short term rates and prime moves in correlation with the discount rate. Some credit cards have a teaser rate. Unless someone is willing to continually roll the balance from one card to the next, the rate will eventually move up. Granted there are some fixed rate cards out there but not many. Today someone could get a fixed rate car loan, simple interest, with no pre-payment penalty in the 5-6% range. When someone goes chapter 7 BK (full liquidation), the unsecured creditors get nothing. Not one penny. The secured creditors take priority in a BK . Thus the unsecured loans will have a higher interest rate to mitigate risk of loss. The reason that most of the principal and interest payment on a fully amortizing car loan (OR ANY simple interst loan), goes to interest at the beginng of the loan is because the payment (P&I) is fixed (constant over the amortization period of the loan). In a simple inerest loan , the higher loan balance (at inception) the higher the interest cost correct? As the loan balance decreases the INTEREST cost is less and more money will shift to principal reduction. Most car loans are simple interest and do not have a pre-payment penalty. VZ if your logic (which is absolutely 100% incorrect) of "On a car loan you pay interest first". I will prove that to be wrong. If you take out a simple interest loan (with no pre-payment penalty) TODAY for 40K, and the VERY NEXT DAY you make one PAYMENT of 40K the loan is paid off. Period. It did not go to interest first, it was a 100% principal reduction. The only part you may lose is any application or processing fee as those tend to be non-refundable. They are nominal (usually in $50 range if any). You are being charged interest per diem ONLY for the days you have the loan outstanding. | ||
| Taek-Ho Kwon (Stickanddice)
Intermediate Member Username: Stickanddice Post Number: 1025 Registered: 11-2002 |
A large portion might be interest, but it's not all interest, then principal. Wayne is right. Cheers | ||
| L. Wayne Ausbrooks (Lwausbrooks)
Intermediate Member Username: Lwausbrooks Post Number: 1855 Registered: 8-2002 |
"on a car loan, you pay the interest first, then the principal off" I do car loans for a living. This is simply not true. | ||
| V.Z. (Ama328)
Junior Member Username: Ama328 Post Number: 141 Registered: 11-2002 |
Couple items here: * go here for LOTS of credit info, on scoring, bureas, credit cards, etc. VERY informative...for the most part, what's posted in this here Fchat thread about credit is either wrong or not indepth enough. Go find a more researched source if you're gonna play the credit/scoring games. http://www.creditboards.com/phpBB2/viewforum.php?f=2 * One interesting financing option, that is not usually available, would be using credit cards for some/most/all of the purchase. This is one rare point in time where one can get relatively low rates(with good credit), and might be in the ballpark or better than conventional financing. Now, normally, this wouldn't be a good idea, and in fact, would drive down your FICO score, but under some circumstances could be an advantage: * first up, if you're buying a 'cheap' Fcar, and don't wanna mess with comp/collision, you could skip it. Banks typically want full coverage, at least until you get the remaining balance down pretty low. * on a car loan, you pay the interest first, then the principal off. On a credit card, you pay interest+principal on every monthly payment. Now, one needs to make sure they're paying enough each month to do this, and not getting trapped in the 'minimum' payment cycle, which could never end. Several yrs ago, I wrote a little 'puter program to layout a payment schedule using credit cards, minimum payments, fixed payment, additional payments, etc., etc., etc., and it was pretty interesting to see that under *some* circumstances, this ain't as nutso as it may seem. Having said that, I'm kinda thinkin' about another Fcar sometime early/middle of next year, and it's *not* gonna be on credit cards Just sumpin' to think about; when you start thinking outside of da box a bit, it's amazing how many different ways there are to get something accomplished. | ||
| Tony Roberts (Pantera)
Junior Member Username: Pantera Post Number: 67 Registered: 6-2003 |
Mr.Kwon, You took the word's right out of my mouth! | ||
| Marq J Ruben (Qferrari)
Member Username: Qferrari Post Number: 390 Registered: 2-2002 |
Well said, jeff.  My sentiments exactly. | ||
| Taek-Ho Kwon (Stickanddice)
Member Username: Stickanddice Post Number: 947 Registered: 11-2002 |
Rob is right. Cash is king, which is exactly why you should finance. Every major optimized business runs on credit even if they have huge cash reserves. It's the only way to fully maximize your financial potential. Just be very careful in budgeting. Make sure you know what you're getting into. Financing tends to make everything seem cheap and that can get folks into trouble. Keep in mind that along with cost of the vehicle there is maintenance, high insurance, and you should set money aside for fixes too. Cheers | ||
| Terry Springer (Tspringer)
Member Username: Tspringer Post Number: 584 Registered: 4-2002 |
Deferred gratification is a good thing.... except for one little issue. We all DIE. Exactly how long should you defer your dream? Be smart. Dont finance something if you cannot afford the payment. Look hard at the interest cost and make sure you are comfortable with it. If possible, choose a Ferrari that is fully depreciated. Thats one part of the non-finance arguement I tend to agree with. A depreciating asset is BAD if it can be avoided. So... rather than buying a new 456, perhaps consider a Daytona. | ||
| P. Thomas (Ferrari_fanatic)
Member Username: Ferrari_fanatic Post Number: 380 Registered: 4-2003 |
The arguments/positions posted just do not have enough information to really make a strong point either way. Taking one small segment of someone's overall finacial position gives limited (useless information.) Although the view points are opposed, a generic blanket statement such as "never finance", or "always leverage to maximize return" is open eneded and not nearly finite enough to present a logical argument. In the world of finance, one must use several tools to evaluate their business (your personal finances should be run exactly as a business.) First and foremost you need a "snap shot of your financial position. 1) Balance Sheet: This lists all of your Asstes (things you OWN) and Liabilites (things you OWE). Your Net Worth (or OVERALL equity position) is determined by the difference of the total fair Market Value of your assets minus your liabilites. 2) Profit and Loss Statement (or cash flow for non-self-employed individuals). How much money do you have coming in? What are your expenses? What is your net at the end of each month?? If someone already has an issue with the cash flow (too many expenses) then they really have no business buying anything else until they get a handle on their spending (really should not be buying a Ferrari). However, what about the investor who has substantial net worth. His money is parked in an investment vehicle already netting 8%. Why would he pull money away from an 8% investement and put it into a decling asset? The answer is they WANT the car to enjoy. One could argue and say NEVER EVER take money out of an investment to buy a toy. But guess what, we love our cars. So shame on some of you that have preached to never finance, as by buying an F-car you have just moved your money out of an investment and moved it to a decling asset. One could scrutinize your monetary decision making skills and say you should never have bought the car as it will lose value (you should have left your money parked in an investment). Going back to the previous paragraph: If a guy is already yielding 8% in an investment (and he is solid in his net worth and cash flow), why wouldn't he finance at 5%. He is still yielding 8%. If he does not finance, he is LOSEING money. Everyone has a different, risk tolerance, time frame, years left to work, years left to invest. Add to that a vastly different mind set derived from different generations. Take for instance the elderly. If anyone has ever heard their views (that were shaped by the depression) and you would think that the world is going to He.. in a hand basket. Take the middle aged "wage slave" and he is going to put a nominal amount into his 401K until he reaches retirement age. Take the young entrapenur and he is going to make money on his money. The middle age group had never seen (until recently) a young entrapenur gain massive wealth until recently (high tech boom) now bust. Young people made AND lost millions! Sorry to go on for so long, but each situation is different. This argument is like going to a Psychologist, telling him 3 sentences and wanting an answer. It all depends! | ||
| Rob Lay (Rob328gts)
Board Administrator Username: Rob328gts Post Number: 5209 Registered: 12-2000 |
"cash is king" That's my point for financing! | ||
| Lucas Taratus (Karmavore)
Junior Member Username: Karmavore Post Number: 221 Registered: 12-2002 |
Let's not get into a needs/wants discussion. I could live in a $50K condo, drive an Echo, eat Peanut Butter sandwiches and still be good at my job and not endanger my life. And I bet you could too. Luke. | ||
| jeff ryerson (Atheyg)
Member Username: Atheyg Post Number: 273 Registered: 8-2002 |
I dont think its jealousy about paying cash for a Ferrari, its a matter of living beyond your means if your are extending yourself on a limb to finance it. You need to take a look at your priorities, I'd rather invest money into business or other things that will build a strong financial foundation and enable you to pay cash for toys than go out on a limb and finance something you really don't need, I like owning my toys free and clear but thats just me, when you finance something it can always be taken away a pressure I don't like and since anything can happen, you lose your job, economy gets bad or you get injured or sick, nothing wrong with financing something but cash is king. | ||
| Frank Parker (Parkerfe)
Intermediate Member Username: Parkerfe Post Number: 2391 Registered: 9-2001 |
Hey, if you guys want to finance a depreciating liability, go for it. IMHO if you can't afford a Ferrari now just admit it, save your money and buy one when you can afford it. Deferred gratification is a good thing. | ||
| Lucas Taratus (Karmavore)
Junior Member Username: Karmavore Post Number: 220 Registered: 12-2002 |
Totally Rob. Driving a Ferrari when you're 25, young and single and driving one as a married parent at 35 could be very different experiences, I'd imagine, and may be worth the cost to some. Luke. | ||
| Rob Lay (Rob328gts)
Board Administrator Username: Rob328gts Post Number: 5208 Registered: 12-2000 |
Lucas, I think you hit on something here. The posters most against it are the ones that waited that 10 years and maybe are a little upset that some are going the same distance year 1. Much credit to those that count their dollars and pay cash. That's your own tolerance for risk and mindset. By saying others are "just plain stupid" is a very ignorant statement. | ||
| Lucas Taratus (Karmavore)
Junior Member Username: Karmavore Post Number: 219 Registered: 12-2002 |
^^^ | ||
| Lucas Taratus (Karmavore)
Junior Member Username: Karmavore Post Number: 218 Registered: 12-2002 |
I think we all have different tolerances for risk and debt, and if you want your toy now as opposed to five or ten years from now, you need to weigh the pleasure against the cost. Personally, I don't have an issue with financing a toy (see below) but if I had maxed out my Home Equity to pay off my credit card debt I wouldn't be thinking of buying a new car, let alone a Ferrari. Others, obviously, feel differently. Unfortunately, there appear to be lots of people here that feel that because then can pay cash they need to preach it is the only way. Personally, I think this helps them maintain a feeling of exclusivity, but whatever the case cash is not the only way, it just costs more. Anyway, if you finance a $35K 308 at 6% for 5 years for $677/mo it will end up costing $40,600, a premium of $5600. If you save $677/mo for *4* years, pay $32,496 CASH for the same car (it depreciated and continue saving $677/mo until the original 5 years is up you will have the car *and* a savings of $8124. Taking that into account, after five years you will net: scenario a) Ferrari scenario b) Ferrari + $8K (for maintenance and mods) - 4 never-to-again-be-seen years of Ferrari-less (free? driving Which is best, to me, really depends on what those 4 Ferrari less years are worth to you. Luke. | ||
| R Leander (Mastertrust)
New member Username: Mastertrust Post Number: 2 Registered: 9-2002 |
There are a number of companies that will fund an open end lease for the purchase of mid 80's Ferrari. Open end leases (in this day of non deductibility of non mortgage related consumer debt) might as well be purchase loans. You end up with low payments for 3-5 years with a balloon payment at the end. The car is titled in the financer's name (rather than just showing a lien) but other than that it is your car. | ||
| Michael C. James (Mjames)
New member Username: Mjames Post Number: 8 Registered: 6-2003 |
Thanks to all for the posts....I'm still weighing my options. Currently, though, Mobile Home/Real Estate speculation isn't attractive at this time.....Here in SC, Mobile Homes can be had for far cheaper than $72K. Interesting idea, though. A friend of mine has financed two Ferraris so far. One he paid off in advance of the loan terms, the second car he's working on currently. Although if he were patient, the opportunity would have been there for him to pay cash for each car in turn. However, sometimes a great deal comes along that one doesn't financially anticipate. I want to have options when the PERFECT CAR becomes available. Thanks again! | ||
| Sunny Garofalo (Jaguarxj6)
Member Username: Jaguarxj6 Post Number: 580 Registered: 2-2003 |
Forget depreciation for a moment, since all of us buy things regardless if it suffers loss or gain of value, be it a book or a boat. Those who are saying pay cash or don't buy, you're telling me you never financed anything in your life, eh? Houses, cars, stones for the wife, all bought in cash right? If so, good for you! Some people want those things and people like me want one thing. And I'll finance to get it when I'm ready | ||
| Marq J Ruben (Qferrari)
Member Username: Qferrari Post Number: 383 Registered: 2-2002 |
Gotta agree with Dom, Frank, & Dave328GTB; pay cash...however, as Michael stated in his original query, that is not an option for him at this time...perhaps next week, Michael, when your Pick-6 hits!!! | ||
| Ricky Nardis (Rickyn_f355)
Member Username: Rickyn_f355 Post Number: 368 Registered: 8-2002 |
i could have paid in full for my car a few times over and i actually totally disagree about paying for toys in cash. You are short an option by paying in full up front, especially with interest rates so low. I'd much rather have a call on my cash and the liquidity as opposed to having it sit in my garage. And yes, I�m more than willing to pay a 5% apr for this call option. So by borrowing you are paying away some premium to be long optionality and long liquidity. Long optionality and long liquidity are the only trades i want to be involved in. | ||
| L. Wayne Ausbrooks (Lwausbrooks)
Intermediate Member Username: Lwausbrooks Post Number: 1822 Registered: 8-2002 |
"Any ideas on who I should talk to? What down payments are expected (I've heard 20% floated in other discussions)?" Oh yeah, Michael, in case you missed it, buried among all of the preaching and financial advice, there was an actual answer to your original question: http://www.jjbest.com/ Down payment will depend on your credit. | ||
| E. Ryan Sabga (Sherpa23)
New member Username: Sherpa23 Post Number: 9 Registered: 5-2003 |
Hmmm. Interesting. So in theory, the notes are simply a semi-liquid asset, i.e. the money is there but it will take some years before it entirely reaches your pocket (although I don't entirely understand how you're getting that much above the $72k). This is not entirely the same as "spending what you don't have" but it's still not without risk. Return is usually proportional to risk. The big risk here is that your MH buyers may stop paying, leaving you without that money coming in. I am sure that you have ways to rectifiy the situation (foreclose on the note, eviction, etc.) but, conceivably, you can be in a position where you will not have the MH money coming and you will still have to make the payments on the TR. If you feel comfortable with that, and won't stay up nights sweating, then I say go for it. You could build up some cushion on the mobile home income before you buy the TR, though, just so you have a couple months cushion in the event of a non payment by the MH customers. Oh, and post some sweet pics of the TR when you get it. | ||
| Jim Schad (Jim_schad)
Intermediate Member Username: Jim_schad Post Number: 1383 Registered: 7-2002 |
Oh, forgot about interest on your 60K note for 4 years. either way you come out ahead. | ||
| Jim Schad (Jim_schad)
Intermediate Member Username: Jim_schad Post Number: 1382 Registered: 7-2002 |
Too tired to read all the posts. But consider this. Take $30K cash, buy 3 mobile homes at $10K and then sell for $72K on terms. Collect $1140 each month for 8 years. Take out loan at 6% for 60K on testarosssa for 4 or 5 years. Use the money from the notes to pay off the car and insurance then collect your extra money for 4 years. Total collected $109,440 total paid for TR $60K. How much out of pocket? Plus $49,440 | ||
| Dave328GTB (Hardtop)
Member Username: Hardtop Post Number: 590 Registered: 1-2002 |
Frankly, buying a Ferrari with cash (or check) and leaving with title in handis about as good a feeling as you can get from material possesions. Paying interest on a toy is like flushing money. With a home equity loan you are just flushing slower. Pardon my conservative, old fashioned viewpoint. Dave | ||
| Taek-Ho Kwon (Stickanddice)
Member Username: Stickanddice Post Number: 896 Registered: 11-2002 |
Sunny, I'm on the fence on that one because I've seen people get burned (layoffs). I agree that financing is OK. >>But when you find yourself thinking what you should spend, not how much you can afford, then in my opinion it's time<< Financing is dangerous because it seems you can afford more than you really can. Exercise caution, that's all. Cheers | ||
| Mister Jones (Davey_jones)
New member Username: Davey_jones Post Number: 25 Registered: 9-2002 |
Good point Sunny - my thoughts are similiar. Thanks for the good info guys! Is this site great or what?! dave | ||
| Sunny Garofalo (Jaguarxj6)
Member Username: Jaguarxj6 Post Number: 577 Registered: 2-2003 |
Some good advice in here. Thanks to all for your comments so far. I disagree with the comments to never finance your toys, thats very subjective. From my perspective, I live for what I want to do. No family (besides parents), no mortgage, no g/f, and I'm extremely happy. I have very little wants. When I decide I finally do want something, an investment is how long it will take to obtain it. How much I enjoy life is proportional to the amount I spend on my vehicles, friends, and family. Sunny | ||
| Taek-Ho Kwon (Stickanddice)
Member Username: Stickanddice Post Number: 895 Registered: 11-2002 |
Nick, Yes. But they need to have your signature to validate the inquiry. There are much more damaging ways to ruin credit than just queries. P. Thomas, In that sense you are correct. 99% of the time if they only run a single query, you will lose 1 point. People are misled because they think that if they go to a car dealership (for instance) the dealership will run their query only once. Sometimes this is not true. Some bureaus (Experian, et al) score differently than others. Experian car credit runs, for example go back 7 years. Equifax goes back 10 years, as a rule of thumb. For someone who has had horrible credit but is on the road to recovery, Experian would be better. For someone who has had unblemished credit but went through some tough times recently Equifax is best because it leverages older history in your favor. So, a dealership could run your credit in XPN, figure out that you are borderline. Run your credit in QFX, and then realize that you MIGHT qualify for a loan. Certainly not a major bank or the auto manufacturer. They'll shoot over the credit info to local banks who will run your credit to give you the lowest rate possible (since you're whining about a better deal ). Local banks say no, so you go to distress type banks that will finance anything that moves. They run it again, etc. Finally you knock off $10 off your monthly payment but lose around 8 points in the process. 8 points not because of random point deduction but because the credit was "checked" 8 times at 1 point a piece. If you think auto dealers are bad, home loans can get much worse. This probably won't apply to most here since credit is usually on the good side if you can keep an Ferrari on your driveway. Cheers | ||
| P. Thomas (Ferrari_fanatic)
Member Username: Ferrari_fanatic Post Number: 375 Registered: 4-2003 |
The fallacy, I was referring to was your quote:"1 inquiry equals 1 point." Totally untrue. Could be 1, could be none, could be more. My point was, aske the people who derive the scores (repostory sources) and you can not get a definitive answer expressed as a quantative figure. The answer is always, "about x" or "on average y". There is no quantative figure. | ||
| Nick (True)
New member Username: True Post Number: 38 Registered: 6-2002 |
Interesting. So could someone with a vendetta against you ruin your credit score by running reports nightly? Employee at dealership etc... | ||
| Taek-Ho Kwon (Stickanddice)
Member Username: Stickanddice Post Number: 893 Registered: 11-2002 |
Ask any institution if running your credit will lower your score. Bank, car dealership, etc. You'll find they will all say yes. If they say no, ask if they can run it and see if the score doesn't fall. They won't. Cheers | ||
| Taek-Ho Kwon (Stickanddice)
Member Username: Stickanddice Post Number: 892 Registered: 11-2002 |
P.Thomas, It isn't a fallacy. Personal queries are handled differently. The reasoning behind dropping scores for inquiries... Unfortunate gentleman X finds out he has cancer. He applies for tons of stuff and gets approved. Spends like a madman and dies. Sneaky gentleman Y is finishing college in the U.S, and returning to his homeland never to return to U.S soil. He applies for eight credit cards, gets approved, spends like a madman and leaves. Ambitious gentleman Z finds out he has good credit and goes on to try to finance a fancy sports car and a pimp pad in the hills. His credit is run and the bank claims that he will be approved. Without queries being listed and affecting credit, while in escrow, the gentleman could overextend his credit and get both even though he would normally qualify for one or the other. I workd with various companies that do this stuff all day. I also worked at a car dealership for fun for a while and found that I was running people's credit from 3-8 times a day. Be very careful. 1 pt for a query is no BS. Cheers | ||
| P. Thomas (Ferrari_fanatic)
Member Username: Ferrari_fanatic Post Number: 374 Registered: 4-2003 |
The "one for one" correlation is a fallacy. I have ran a second report with no effect. The repository sources (Experian, Equifax, and Trans Union) can not even give you a 100% clear definiton of how their model works. It is supposed to be an indicator of the likelyhood of going BK (they have yet another index for BK perpesity as well now). Anyway, it is based on # of tradelines, % of available credit used, age of tradelines, late payments, charge offs, collections, judgments, and liens (which have the GREATEST NEGATIVE IMPACT on your Fico, Beacon, or Fair Isaac score. | ||
| Taek-Ho Kwon (Stickanddice)
Member Username: Stickanddice Post Number: 891 Registered: 11-2002 |
Do beware as to where you run your query and if you are borderline. Some people after running your query will "shotgun" your application to others and therefore your credit actually gets fun five times or so. Not good. Make sure you specify this with whoever is running it. Some tier ratings: 1 660+ 2 640-660 3 600-640 4 600- Others 1 700+ And yet others 1 800+ Cheers | ||
| P. Thomas (Ferrari_fanatic)
Member Username: Ferrari_fanatic Post Number: 373 Registered: 4-2003 |
The Federal Gov. is finally passing bills to monitor these goons. They are totally out of control and the consumer is "virtually" powerless. What a crock of Sh.. | ||
| Taek-Ho Kwon (Stickanddice)
Member Username: Stickanddice Post Number: 890 Registered: 11-2002 |
Mr. Jones. A query will deduct 1 FICO point. Not really an issue if you are comfortably in your tier. Tier's are different depending on who's running your credit and their criteria. Cheers | ||
| James Adams (Madmaxx)
Junior Member Username: Madmaxx Post Number: 141 Registered: 11-2002 |
...like a credit card company reporting you have 5 accounts open (when in fact you have 1) with 10K on them each (when in fact, the 1 is paid off every month)? GRRRRRRRRRRR That ding'd my score a TON... and they're just now getting it all fixed. A "computer glitch". MM | ||
| P. Thomas (Ferrari_fanatic)
Member Username: Ferrari_fanatic Post Number: 371 Registered: 4-2003 |
1 time should not really affect it. FYI, if someone went car shopping and they pulled it 5 times in 1 day, it is SUPPOSED to eliminate same day pulls and hit you with one. The whole system is far from perfect. I have seen so many atrocities it makes my blood boil. | ||
| Mister Jones (Davey_jones)
New member Username: Davey_jones Post Number: 24 Registered: 9-2002 |
Will my score be affected if I run a query on it? | ||
| P. Thomas (Ferrari_fanatic)
Member Username: Ferrari_fanatic Post Number: 369 Registered: 4-2003 |
One of 3 ways: 1) Apply for credit. 2) Write to one of the 3 repository sources: Experian, Trans Union, Equifax. 3) I heard there is a new web site; " My Fico.com". Try a search and see what you get as I think that there a re a couple of sites out there now (membership / pay of course). | ||
| Mister Jones (Davey_jones)
New member Username: Davey_jones Post Number: 23 Registered: 9-2002 |
What's an easy way to check my Beacon score?? | ||
| P. Thomas (Ferrari_fanatic)
Member Username: Ferrari_fanatic Post Number: 365 Registered: 4-2003 |
Terry, negative read the third bullet point from the IRS website (it is about 2/3 of the way down the page). Interest up to 100% of home value and 100K max regardless of purpose. Here is the link (could not html format due to the commas). http://www.irs.gov/taxtopics/page/0,,id=3D16233,,00.html Or in search bar put "Mortagage Interest" and it will come up: "Mortgages you took out after October 13, 1987, other than to buy, build, or improve your home, but only if these mortgages totaled $100,000 or less throughout 2002, and all mortgages on the home totaled no more than its fair market value. The limit is $50,000 if you are married filing seperately." | ||
| Terry Springer (Tspringer)
Member Username: Tspringer Post Number: 581 Registered: 4-2002 |
all mortgage companies, both first and second lien holders, issue form 1098 mortgage interest statements on all loans at the end of each year. This statement tells the IRS that the interest is mortgage related. Thus, pretty much everyone rights off this interest. I know several people who have done this and been audited. The IRS did not disallow the interest deduction even though the proceeds from the closing on the second lien were not used strictly for home improvements or the home purchase. However, tecnically they could have disallowed it as IRS rules do say mortgage interest is only deductible if the proceeds are used for the purchase of the home or home improvements. Debt consolidation is technically not an approved use and thus the interest is not tax deductible. So.... you can deduct it, but you cant. Does this sound like the Federal Govt yet? IRS agents see a form 1098, they classify it as mortgage interest and thats that. Just hope you dont get a real anal SOB who wants to see the settlement statement on the closing if you did debt consolidation. | ||
| P. Thomas (Ferrari_fanatic)
Member Username: Ferrari_fanatic Post Number: 364 Registered: 4-2003 |
Just the interest paid. A couple of years ago lenders were going 125% of the property value on seconds, scary. In that case the amount UP TO, but not over the value of the home was tax deductible. | ||
| E. Ryan Sabga (Sherpa23)
New member Username: Sherpa23 Post Number: 8 Registered: 5-2003 |
P., So does that mean if I consolidate any other debt, say my wife's student loan from grad school, with the mortgage, I can deduct 100% of the loan payments? Or is it just the interest? Sorry for the OT/thread hijack. | ||
| L. Wayne Ausbrooks (Lwausbrooks)
Intermediate Member Username: Lwausbrooks Post Number: 1812 Registered: 8-2002 |
Michael C. James, to answer your original question: http://www.jjbest.com/ Down payment will depend on your credit. | ||
| Rob Lay (Rob328gts)
Board Administrator Username: Rob328gts Post Number: 5192 Registered: 12-2000 |
Bob and Dom, yes, I hear you, I haven't earned 10% every one of the past 4 years. However, long run averages are always more important. Also, if you can't afford it, you can't afford it. I'm saying this philosophy only works if you have the liquid assets, but leave them in investments, and borrow money at a low cost. Right now 4.5% and deducting the taxes being the lowest cost. | ||
| Dom Vitarella (Dom)
Junior Member Username: Dom Post Number: 204 Registered: 11-2002 |
P. Thomas, Really? That's news to me. Thanks for the info. Dom | ||
| Dom Vitarella (Dom)
Junior Member Username: Dom Post Number: 203 Registered: 11-2002 |
Yep, I wish I was earning 10% also  Apparently there are some out there doing this (or better). | ||
| P. Thomas (Ferrari_fanatic)
Member Username: Ferrari_fanatic Post Number: 362 Registered: 4-2003 |
Dom, negative. Interest on loans with a combined loan to value of 100% or less is tax deductible. That why I see people everyday consolidating their consumer dbt and it becomes tax deductible regardless of use. | ||
| Taek-Ho Kwon (Stickanddice)
Member Username: Stickanddice Post Number: 883 Registered: 11-2002 |
Forgot to add... Home FICO will be higher. The loose reasoning behind it is that houses APPRECIATE, and cars DEPRECIATE. In general, of course. Cheers | ||
| Taek-Ho Kwon (Stickanddice)
Member Username: Stickanddice Post Number: 882 Registered: 11-2002 |
Michael, Keep in mind that a FICO/Beacon score for a home loan is very different from that of a car loan. Around 50pts. different. There are companies that finance classic cars, even restoration projects! I do agree with some of the peanut gallery though. If you can't afford it, don't get it. What you can afford is of course something you will have to decide. But when you find yourself thinking what you should spend, not how much you can afford, then in my opinion it's time. Cheers | ||
| E. Ryan Sabga (Sherpa23)
New member Username: Sherpa23 Post Number: 7 Registered: 5-2003 |
While I agree with the "don't finance a toy" argument, I would also add: don't finance a depreciating asset (If you're going ot park the car and hope that it's worth more in 20 years, that's something else). I own my cars and my bike outright and now that my M.B.A. is paid off, the only debt I have is my house ("good debt" which my wife acquired before we met) as I am really scared of debt. Anyways, the only real toy that I purchased was my Ducati and I tinkered with the idea of financing some of it since I wanted to build my credit (and we all know about the cost of capital, right?). I investigated it thoroughly and talked to several banks. What I learned is that the banks won't cut a good interest rate on anything that they consider a toy and really scrutinize the purchase. At any rate, I financed it (I needed to add some depth to my credit history)and paid off the loan as soon as the back had record of it in their computer (12 days). It's cost me $34.39 over a cash deal so it was a pretty cheap to add some credt. Anyway, I digress... What I think that you will find is that while most banks will give you the thumbs down, there will be several that want your money and will help you out. However, they will make it less attractive financially as not only will the interest rates be higher for the older car (toy factor, too), but the payment terms will probably be less attractive as well. It's none of my business what you do, but if you do finance, search hard for someone with reasonable terms. It will be very difficult but you might get lucky in this economy. If you are buying through a dealer, they might have a bank that will give you favourable (relatively) terms, possibly even better if the dealer is motivated to make the sale. | ||
| P. Thomas (Ferrari_fanatic)
Member Username: Ferrari_fanatic Post Number: 361 Registered: 4-2003 |
This comes from a person who sells financing for a living. Please do not infer that it is like the Insurance Salesman trying to sell everyone insurance, but here is my point. I think that regardless of someone's net worth, they should have a maortgage. Why? In today's market we are experiencing a 41 year low in interest rates. With the conforming 30 year at 5.00% and the 15 year at 4.50% it is really cheap money (to invest, aquire asstes, etc). Even if an individual has significant net worth, all of their Schedule B (Interst Income), and Schedule D (Dividend Income) is taxable. The last time I checked, one must pay income tax on the interest received and capital gains on investments. So, if someone does not have a mortgage, how would they have a significant tax right off?? You need your mortgage interest as a base to add on your itemized deductions or you will never exceed your standard deduction. Taken to the Nth degree, another argument to be made from a pure investment stand point is why would you then "park" your money in a Ferrari. True investments have a CHANCE of going up. No modern day F-Car will increase in significant value. So IMHO, we really should not preach the virtues of "investing" when we are ALL spending our money on something we love. Financed or not, it is going to cost $$. | ||
| BobD (Bobd)
Intermediate Member Username: Bobd Post Number: 1245 Registered: 3-2001 |
Great concept on the investment side.... but some of us haven't been so fortunate the last few years as it relates to generating 10% annually. So what happens when you borrow for your toys, invest the cash and lose 10% annually. Don't tell me, everyone else out there is just a smarter investor than myself? | ||
| Terry Springer (Tspringer)
Member Username: Tspringer Post Number: 579 Registered: 4-2002 |
Ah Jeeeeez the pretentiousness can get deep around here from time to time. Not everyone is rich. Some people realise that one day you will die and that nobody is taking it with them. For some people, to realise a dream requires creative strategies such as financing. If your putting a decent amount down on a Ferrari purchase, and your going with a used model that is unlikely suffer serious depreciation, GO FOR IT. If things get bad, ie. lose job or such, just sell the damn thing. Sure you may lose some money, but the risk is not huge. I am of coarse assuming your not using every penny of cash reserves for a down payment. Lets say you buy a used 328 and finance 75% of the purchase. Compare that to purchasing outright a brand new SUV at the exact same price. I guaranty you the interest expense will be less than the depreciation! Be smart about it, but dont sweat the rich man attitudes of some folks. I financed my F-car and love it. I also drive a total piece of crap as a daily driver. Thats my sacrifice, and worth it no question. BTW JJ Best can help you no problem. The specialize in collector car financing. | ||
| Dom Vitarella (Dom)
Junior Member Username: Dom Post Number: 202 Registered: 11-2002 |
Rob, That's what I was talking about (borrowing at a lower rate than you're getting paid). For example: Borrow $25,000 at 5% interest Invest $25,000 cash at 8-10% interest Use interest from investment to pay off interest and principal on loan. This is the only way I would consider borrowing money for a car. This is risky, however. I am fiscally conservative, and I just haven't had the balls to do something like this. But I've been tempted to try. Maybe if I did, I'd have more money to play with now... In short, I agree with Frank. And what the hell, I guess my 308 is a Dino after all Re: Home equity- I believe that if you use the money for something not home related, then it is not tax-deductible. Dom | ||
| Rob Lay (Rob328gts)
Board Administrator Username: Rob328gts Post Number: 5190 Registered: 12-2000 |
Frank, you're missing the point (for the first time) on this. Economy goes south, loose job, whatever, then take the liquid assets and pay down the debt. Key is to be diversified so if for example the market crashed, you wouldn't loose all your liquid assets. Simple good investing. I agree with your philosophy in one way, but for another complete reason. That would be for peace of mind. Many don't like the stress of "owing" money. Also, if you're filthy rich, then why do you want to even mess with a little $100k loan with a monthly payment you have to make. However, if it doesn't mentally bother you and you don't mind the book keeping, then you are loosing money by not financing low and investing high. Plain and simple, no way to argue against it. It's nothing about living beyond your means, it's about being a smart investor. | ||
| P. Thomas (Ferrari_fanatic)
Member Username: Ferrari_fanatic Post Number: 360 Registered: 4-2003 |
Regarding Home Equity Lines of Credit (or Fixed Rate Seconds), other than interest tax deductibilty (interest on a combined loan to value of 100% is generally tax deductible)what is the difference? I look at the Net Worth of my client: Assets (what you own), less liabilites (what you owe). If someone finances a car with a consumer loan or a mortgae loan, their net worth or equity position is still the same (50K car, 50 K loan) = no net worth. As the car starts to depreciate the equity position changes (in a case of 100% financing) the person is "upside down". The preferred method is to use mortgage financing, but from a net worth position it is a moot point. | ||
| wm hart (Whart)
Intermediate Member Username: Whart Post Number: 1213 Registered: 12-2001 |
Frank: What's your position on home mortgages? | ||
| Frank Parker (Parkerfe)
Intermediate Member Username: Parkerfe Post Number: 2388 Registered: 9-2001 |
Rob, this site does not have the capacity to process the number of words to state all the reasons why one shouldn't borrow money, especially through a home equity loan, to buy a toy such as a Ferrari. One of the most important is that if the economy goes bad and you lose your job or income, then you could lose not only your toy but your home too. I have always been taught to live within my means and not try to keep up with the Jones. If you haven't accumlated enough wealth to pay cash for your toy of choice and have a LOT left over, you need to rethink your priorities. If you want to own rich-boy toys then you need to act like what creates rich-boys in the first place. Education, hard work, perserverance, capital conservation and a little luck. Borrowing on your home to buy a toy is just plain stupid IMHO. | ||
| P. Thomas (Ferrari_fanatic)
Member Username: Ferrari_fanatic Post Number: 359 Registered: 4-2003 |
I do not think that you get a lower rate for a higher FICO. However, if you have a 780 score, I bet that they will not require any documentation to get approved. Since they are Retail (consumer direct) versus wholesale (broker referred) I do not know their underwrting guidelines. With a 780 score I bet that you will have an approved answer with no other docs required in 20 minutes. Seriously, you will be surprised. | ||
| James Adams (Madmaxx)
Junior Member Username: Madmaxx Post Number: 139 Registered: 11-2002 |
780 beacon score is aproaching bullet credit. IE: You could make demands to a lender like you were holding a gun. Try a credit union first. I deal with mine so much they all know me by name (not sure if that is a good thing...). James | ||
| Michael C. James (Mjames)
New member Username: Mjames Post Number: 7 Registered: 6-2003 |
FICO of 660? Mine's 780 and climbing - does that affect the interest rate you're offered? Thanks to all! | ||
| P. Thomas (Ferrari_fanatic)
Member Username: Ferrari_fanatic Post Number: 358 Registered: 4-2003 |
Micheal, I am a Licensed Real Estate (and Mortgage) broker. Although I do not make 1 Red Cent off of referring people on Consumer loans, here is a lender that has rates around 5.75%. They really do not scrutinize the year, make, model etc. It is credit score driven, so if you have a decent FICO (660+) you can get pre-apporved in 15 minutes. I referred someone recently and they said that they were sent a check (technically a draft) which is written directly to the seller. It is that easy. Let me know how it works! peoplefirst.com | ||
| Jim Schad (Jim_schad)
Intermediate Member Username: Jim_schad Post Number: 1380 Registered: 7-2002 |
www.peoplefirst.com will do it online. put in a request for how much you want and what it is for and how much you make. they will require you fax them paystubs etc to verify income. they then mail you a blank check up to the value you requested. YOu can request either to buy from a dealer or individual, but not both at the same time. I got approved for a $46K check with zero hassles, but never used it. Chickened out. | ||
| Rob Lay (Rob328gts)
Board Administrator Username: Rob328gts Post Number: 5187 Registered: 12-2000 |
The cold hard facts are that borrowing money costs and investing money pays. If you can borrow money at a lower rate than you're getting paid, then why not? Especially a home equity loan like my 328 is on. I have a home interest rate and get to deduct the interest. Fact is 60% of Ferrari owners financed their cars whether good or not. If no one financed, then the market would drop out of the used Ferraris. | ||
| Frank Parker (Parkerfe)
Intermediate Member Username: Parkerfe Post Number: 2387 Registered: 9-2001 |
The hard cold facts are that if you can't pay cash, you can't afford it. Like Uday Husseim said, never finance a toy. | ||
| Michael C. James (Mjames)
New member Username: Mjames Post Number: 6 Registered: 6-2003 |
Unfortunately, I'm maxed out there - used all my equity to pay off the plastic. So I'm very close to being debt free (save for the mortgage). I could swing a $600+/month car payment EASY, but first I have to find a lender who will look into early/mid '80s Ferrari book values..... Might as well find someone selling coke, too (been watching Miami Vice reruns on TNN/Spike TV lately)! | ||
| Dom Vitarella (Dom)
Junior Member Username: Dom Post Number: 201 Registered: 11-2002 |
My advice: Don't do it. Never finance a toy (unless you use the cash for some other investment that pays the interest on your loan- tough to do). Wait until you can pay cash, then do it. Remember, if you are dealing with a 15 year old car, there will be maintenance on top of the loan payments. And that maintenace won't be cheap. Dom | ||
| wm hart (Whart)
Intermediate Member Username: Whart Post Number: 1211 Registered: 12-2001 |
Why not a home equity line? The rates are cheaper than any car financing, and as long as you are not buying drugs with the money, i don't think the bank will care what you do with it. (In fact, you could use the money to buy drugs, as long as you don't use them yourself, or get caught selling them to others, but, to paraphrase H. thompson, I wouldn't advise doing that.) | ||
| Michael C. James (Mjames)
New member Username: Mjames Post Number: 5 Registered: 6-2003 |
I'm interested in obtaining a pre-approval for car financing. My credit has been pulled recently (refinanced the house because of the tanking interest rates) and the scores say I have excellent credit. Problem is this - I had a huge hassle with my own bank to finance a 15-year-old exotic whose value they didn't quite understand. Luckily, there were some NADA figures available for the financial folks to crunch, and once they realized their investment was safe, they cut me a check for the car. The rules have tightened a bit, and now most lenders I'm aware of won't touch a car that's not less than 5 or 7 years old. Some of the Web sites I've visited on the subject require you to purchase from an authorized dealership that is cooperating with their lending schemes. I know most of you pay up front, in cash for your cars. Bless your good fortune. I am currently unable to attempt such a feat, as the Good Lord sees fit to sell me the wrong Pick-6 ticket each saturday. Any ideas on who I should talk to? What down payments are expected (I've heard 20% floated in other discussions)? Thanks to all! | ||
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