First time Ferrari purchase! Need Advice Please!

I'd get the 355, personally. Not knocking the 360 - just get in a Ferrari ASAP. The great thing about a 1999 355 is it's the last year of production for the model, and it's the best. Most 355 problems were solved (major ones) like valve guide etc. Just look out for shrinking leather on the dash and sticky console parts.

Good luck.

 

I had a 97 355 spider, tremendous car, had it for five years with no issues
you will have a blast

Tarek

 

http://www.ferrarichat.com/forum/showthread.php?t=63827&highlight=maintenance

 

I don't have a Ferrari yet... but being on this board for a while made me wake up to the maintenance cost issue. I've seen many posts about repair/maintenance bills costing 5K - 10K. I just thought I'd bring this up now... you don't want to get a car and then get hit with a bill for 5 grand! Just know that it's very possible.

On the lighter side - I think the 355s are absolutely awesome, and I think they're a great buy. Have fun!!

 

Aaron,

Here's my take on the situation.

Do considerable shopping, listen to the great advice already given, and then talk to a well-respected finance firm such as Woodside Credit (www.woodsidecredit.com).

If your FICO is 750 or above, they would finance the major portion of that car (maybe even 100%) for up to 10 years. Talk with them even if your FICO is lower.

If this is your first venture into Ferrari, you would be best off to put that $40K you say you have into a fund until you have a good experience with the F-cars. Cash is king today, and you should hold it.

You could then always refinance the car in the near future if you are pleased with it and then invest some of that cash into the refinance.

It's just a good business perspective to do this with a new venture.

 

I suggest buying a early model EURO 360 for the same amount as a 355 spider. More modern, bulletproof motor less service issues. I did it and have no regrets

Just my opinion
Big Mike
Mike

 

My feeling has always been that leasing is a waste of $, and many leasing companies do not report your payment history to credit bureaus. So, this does nothing in most cases to build your credit score assuming one is financially responsible. Also, you have nothing tangible at the end of the lease period.

I am very careful financing new ventures and always look to outside financing as a cushion. I would consider for some that buying an F- car is a new venture.

So, my take on financing is to ask a specialty funder such as Woodside (or any other funder such as a credit union) to initially finance the car 100% including sales tax, registration, etc. which many will gladly do if you have good credit and/or a good prior relationship with the funder.

In this manner, if the car is not what you want and you sell it, you are out only a small amount of interest $, sales tax $, etc.. Large amounts of cash put into a car initially does not make good sense to me. The $ is better used elsewhere.

I never initially put $ into a car purchase. I will finance for the maximum amount and maximum period initially and then 6-12 months later refinance and pay down a good part of the note if the vehicle is ok and if I like it.

This is also very valuable approach for one's credit report. Lenders look to what is called a "high car credit". They look to what was the most expensive car you have purchased and how you financially handled it.

So, try this with an F-car, and you'll see how your credit score will increase if your payments are timely. Overpay the principal every month as well.

Include a separate check with your regular payment marked "principal" and make sure every month it is applied as principal. This up's your credit score considerably as well even if it's only $50.00 per month towards the principal.

The way I see it it's just smart use of $, and this approach has worked well for me for many years.

Try it.

 

ditto to GC's reply. My thoughts exactly. Don't pay for something your not going to keep. Make the payments on the car and the nice thing with an Fcar is you will usually not lose alot on resale. I am on my second and came out ahead on my first. Have a 355 and lovin it. It is now my primary car as a new jag conv. I have, got nailed from behind last week.

 

Aaron,

Doesn't matter that you intend to keep the car.

Every car I have purchased I did not intend to sell at purchase but I did later! The one I regeret the most having sold was the beautiful Dino I bought in Italy in 1975 for $6K, imported and fully certified it, then stupidly and foolishly sold it in 76!

As a result, I now strictly follow a principle, and remember what I said about "high car" value! That ups you FICO.

Up til May 30 I had 3 new M-B's. I sold the SL500 in May after 2 years, had no cash tied up in it, made $ on the sale, and used the cash in my business to generate more $ that would have been tied up in that car!

And, BTW, I sold the SL500 cause I am now searching for a 360 coupe!

Seikel, Aaron, seikel!

 

What's cheaper, paying an extra 200-300 a month for a short period of time that you have the car, or dropping $40k in one shot?

-R

 

My rule of thumb when buying toys, and I consider a Ferrari to be a toy,
is never finance a toy, always pay cash.
If you can't afford to pay cash for your toys, then you can't afford the toy!
A Ferrari can be an expensive car to maintain, that can cost nothing but the price of fuel one day, and $15k the next.

IMHO, the $40k you have saved will buy you a nice 308 with enough reserve to maintain the car, or a 328 with no reserve to maintain it.
But $40k is not enough to enjoy ownership of a 355 or 360.

 

I agree with Dave, but this subject has been debated as often as car wax and floor mats.

If you're comfortable with the debt (as I am not), then buy the 355. It's a great car and as others have mentioned, and the 99 is the best of the bunch. I want a 355 too, but won't get one until I can own it free and clear.

Be SURE to get a PPI so you have a good idea of what the car needs. Maintenance IS expensive, be ready for it. If $40k is most of your cash, you could wind up in trouble in a hurry. I personally know of a 355 that has required ~$20k in repairs in the last 18 mos. That car is probably the exception, but are you sure that your car won't be? Put some money aside for maintenance, then add 25%.

The 308/328 option might also be a good one for you. The repairs are no where near as expensive as a 355 and it will give you a great taste of Ferrari ownership.

 

Hey Aaron,
I'm in the same situation as you. Got 40 k for a down. With the same reasoning as you. I won't settle for anything less than a 355B though. I like what GC has to say. Even though 10 years is along time. You can always add principle at your discresion or refinance. I wish that I was in Daves position. He's obviously in a better situation to approach this in a more practical manner. I'll be following your posts to see what you decide.
SteveV

 

Aaron,

As to your statement:

"if I purchase a car and have it 100% financed, doesn't that make my payments a lot higher?"

Of course it does. It is simple mathematics.

The point here is that the monthly $ amount is not initially the major issue. It's whether or not the "venture" is a good one.

Remember, you can refinance the car if you are pleased and then drop the payment.

Go to the following link for the car loan calculator and play with the numbers:

http://www.autoworld.com/apps/calc/autocalc.asp

You are not buying real estate here that will increase in value. You are purchasing a declining asset.

Where is it best to put the cash? That's an easy answer.

 

I think that, because of the fact that you are not buying an asset that will increase in value, but rather, will decrease, it makes more sense to get a loan for a smaller amount, and put a down payment on it. If you get 100% financing and don't like the car, or you want to sell it for any reason and the car has lost a bit of value, that means that you're gonna be in the hole for the difference in the ($) value of the car and the ($) loan, otherwise known as being "upside down".

If we're talking about $40,000 that you're financing, instead of just putting that amount down, your monthly is gonna go up about $600.00, figuring that you're paying $15.00 a month for every thousand dollars that you finance.

My humble opinion.

 

While what Fabio states makes very good economic sense, the suggestions I had made were based upon Aaron's insecurity with the purchase of a Ferrari.

So, my advice was to initially conserve the cash until he felt more comfortable with the purchase, and then he would have the latitude to decide at a later date to refinance and drop cash into it during a refinance.

There is never a substitute for good economic sense, but I firmly believe that sometimes common sense plays a much bigger role.

For example, here in N. Calif, the big thing is 100% financing for a house purchase! Absurd in a leveling market. With your basic 3 bedroom home costing around $1 mil, those who should not and cannot buy are because of this financing. It's definite suicide. As the interest rates rise, so do the flood waters of debt! This is bad economic and bad common sense!

 

Why $ 40,000 down payment on a 355. If you are ready to drop $ 40k down, step up. If you are goining to finance any portion, might as well take the $ 40k and invest wisely and get good terms on a 355 with $ 5K or so down. I got like 6% on 84 months on a 2001 Lambo with only 10 percent down. Can do better than 6 percent on your money. Can get up to 144 months if worried about payment maybe for around 8 percent if you in the 740 beacon range.

 

I agree with DougH.

Precisely my prior points.

With the car business having slowed down a bit, you ca bargain for best finance rates.

That $40K is king in your hands not someone else's hands!