Buying/Renting General

[Anonymous No.11963790]

LADS
Everyone save this image.
And lets keep this general going consistantly.

Anyone buy a car recently?
i got 2k to put down, want to pay 200 -230 a month.
Do you guys know what interest rates car dealerships are working with lately for people with pretty good credit?

[Anonymous No.11963821]

Do used car places just copy national average loan rates?
When i google it i see about 5% at the moment.

I know some places do deals like 18 months without interest.

[Anonymous No.11963823]

Im in toronto, canada and I know people who have gotten as low as 1.99 %

[Anonymous No.11963833]

>>11963823
im in the north east myself, Connecticut.

trying to figure out what to expect like >>11963821
mentioned

[Anonymous No.11963842]

>>11963833
this is also for new cars, not sure about used

[Anonymous No.11963883]

A 16k car, divided by 210 a month is 76 months.
6 years and 3 months

9k car, 3.5 years

210 with 5% a month = 220.
220 * 76 months = $16, 720
220 * 42 months (3.5y)= 9240

Am i doing this interest correctly?
Doesnt seem like much

[Anonymous No.11963974]

>>11963883
yeah that doesn't seem like much.
Help anoyne else?

[Anonymous No.11964159]

bump

[Anonymous No.11964179]

>>11963790
>financing a car

There is no greater waste of money.

[Anonymous No.11964202]

>>11964179
what do you advise.

[Anonymous No.11964311]

>>11963883
Can someone check this and see if im making and rook mistakes, fees and othershit wise?

[Anonymous No.11964419]

>>11964311
also would like an answer here on additional fees

[Anonymous No.11964523]

>>11964179
This is common sense
OP will never make it

[Anonymous No.11964538]

>>11963883
You didn't calculate fiat inflation.

[Anonymous No.11964653]

>>11964538
changing interest rates?

[Anonymous No.11964737]

>>11964202
buy one outright if a car is a must for you. The purpose of financing a car is to drive a nice car you cant afford on a two year term and then either buy it at a reduced price or give it back. A vehicle is a shitty asset though because it only goes down in value, not up, save for vintage cars. Unless you reaaalllyy wanna show off but then youre a faggot and theres no helping you.

[Anonymous No.11964755]

>>11964737
>>11964202
Also, if you were willing to finance just buy a car on installments. Thats what i did for mine, paid 2200 for it and had it paid off in 2 months or so. Most mechanic that sell used cars will let you do this.

[Anonymous No.11964765]

>>11964737
I agree man, that's why im trying to be careful with the math.

but looking at >>11963883
240 dollars in total interest isn't scary to me.

which is why I thinking buying a 9k 2012 might be the smartest deal for someone wanting to put a 2k down payment. with a 3% or so interest rate..

im trying to find this sweet spot.

no bullshit brand new car for 21k
no 2k piece of shit
not a 12 year old car with 120k miles on it for 5k..
feel me?

[Anonymous No.11964775]

>>11964755
>>11964737
>>11964523
This. Car dealerships make as little as 80 dollars on most new car sales. All of their profit comes from financing and used car. Car dealerships are banks that specialize in selling you luxury you do not need.

[Anonymous No.11964883]

>>11964775
any thoughts on my sweetspot theory here
>>11964765

[Anonymous No.11964885]

>>11963883
What are you doing?
>5% per month
>adds 5% to the annuity
That's not how any of this works.

You take out a principal, in this case 16k.
For loaning you this principal the lender charges interest as a percentage of the unpaid principal.

5% interest compounded per month is an insane rate. It works out to ~80% annual rate (or 12.8k in your 16k example).
More likely than not we're looking at 5% annual rate. To calculate compound interst with 12 intra-year periods we can break it down to rougly 0.42% per month.

The basic mode for the first month:
$16,000 outstanding loan, 0.42% interest = $67.20
total debt at the end of month 1 = $16,067.20
repay $210
outstanding loan at the end of month 2 = $15,857.20

Rinse and repeat.

To calculate it all at once, we can use annuities.
16k principal, 210 annuity, 76 periods, 0.42% interest works out to total payments of 18,755.35 at the end of the loan.

So you end up paying 2,755.35 in interest.

[Anonymous No.11964997]

>>11964885
Jesus Christ, thank you. I knew that had to be wrong.

so the 5% is an annual interest rate?
so the 5% /12 months = .42% per month..
and you simply multiply current remianing debt by .42% every month?

[Anonymous No.11965035]

>>11964885
>cont.
In fact, it doesn't even work out as you would have debt left at the end of the 76 months.

To keep the duration the same you would have to go up to $246.35 monthly payment so you're done after 76 months.

This is also typically how you would calculate an annuity. Either the montly payment or the duration are left variable. Setting both for a fixed value doesn't make sense.

[Anonymous No.11965088]

>leasing anything, except shit you collect money on each month
Absolutely never going to make it.

[Anonymous No.11965099]

>>11964885
>>11965035
So how much total interest at a 9k car at 200 a month
And what if we turn that to 250 a mon?

[Anonymous No.11965114]

>>11965088
yeah I don't understand leasing at all..
I mean I guess unless youre pretty wealthy and want to rent a nice new car for 300 a month without owning it

[Anonymous No.11965130]

>>11964997
>so the 5% is an annual interest rate?
I don't know. Could be a loan shark charging 5% per month. You know the terms of the loan, I don't. I'm just guessing.
>so the 5% /12 months = .42% per month.
Yeah, for simplicity's sake. It's more complicated, closer to 0.41%, but who cares. The annual rate is assuming compound interest, so the monthly rate would be slightly lower than just rate/12 (example: $100 at 12% annual isn't equal to 1% monthly. 1% monthly compounds to more than 12% as after 1 month you'd have 101, after 2 months 102.01, etc.)
>and you simply multiply current remianing debt by .42% every month?
Yes. It depends on your contract, but typically your payment is a fixed amount. That means at first a large chunk of your monthly payment will go towards running interest, not towards repaying the actual debt from which the interest is calculated. At the end of the loan you'll be repaying mostly debt with very little interest. This is what typically kills idiot debtors as a too low monthly rate or a surprising hike in interest can mean that you basically never catch up to interest.

[Anonymous No.11965207]

>>11965099
>So how much total interest at a 9k car at 200 a month
Comes down pretty closely to 50 months duration, meaning $10k total payments i.e. $1k in interest.
>And what if we turn that to 250 a mon?
Around 39 months, totalling roughly $9,750 or $750 in interest.

[Anonymous No.11965209]

>>11965130
right right, I get you, that makes much more sense.

and how about this question >>11965099
how big of a difference does that 50 dollars more make on over all interest in the end

[Anonymous No.11965256]

>>11965207
thanks already answered me..

any thoughts on this? >>11964883
factoring in shit like resale value?

i mean i know buying brand new is stupid.
Buying 2 year old car at 19k is probably pretty dumb too with the rapid depreciation.

i know buying a 2k car and having it last 5 years is probbaly most economical

but say i want a pretty nice car
i wonder if i should chase a 12k car vs a 9k car vs a 6k car

[Anonymous No.11965274]

>>11965256
and if I could afford it, should I just straight up buy a 10k car flat out..
or do you think 3% is pretty good and worth holding onto my usable cash?

[Anonymous No.11965314]

>>11965256
>>11965274
Yeah maybe buy a 12k car and re sell is for 6k(?) 5 years later?
Would a car depreciate that much in 5 years?

Assuming it does
After interest maybe 13.5k minus 6k resell
7.5k over 5 years is 1500 a year

[Anonymous No.11965400]

>>11965256
I'm not a car guy, I don't even own one.

>>11965274
That question is more my speed.

The above calculation was still using 5% btw.

Financially the decision is easy: Can you do something with your money that nets you more than 3%? If yes, you should take out a loan and use your money for the more profitable investment. If you cannot do something with your money that reliably nets 3%, repaying the loan is literally the most profitable investment you can do.

If you value options or spending money on other shit more than profit, that's a fine personally choice. The financially responsible choice however is the above.

Debt can be a useful tool. Consumer debt (i.e. debt you blow on lifestyle instead of investments) however is almost universally bad. You're bleeding money, paying more for a good than you need to. You also run the risk of losing track of your finances, etc.

At the end of the day it's a personal decision. You're an adult. Nobody forces you to make reasonable decisions, so it's up to you.

[Anonymous No.11965507]

>>11965400
interesting.

thanks, you're the man!

hmm
>According to current depreciation rates, the value of a new vehicle can drop by more than 20 percent after the first 12 months of ownership. Then, for the next four years, you can expect your car to lose 10 percent of its value annually. This means the average new car is worth just 40 percent of its purchase price after five years.

this is interesting thought >>11965314

lets say I buy a 13k car more then 3 or 4 years old..
in 5 years
13k - 10% = 11,700
11.7K - 10% = 10,530
then 9,477
then 8,530
then 7,677

so 13k car (we'll call it 14.5 after interest)
- 7,700 = 6.8k
6.8k / 5 years = 1.36k per year

[Anonymous No.11965862]

>>11965507
Biz
Can we do the math out year by year and make a comprehnsive Best age and price to buy, this is pretty damn revealing

[Anonymous No.11966337]

>>11963790
If you're in the US, Enterprise Auto Rental has some pretty good deals. Every 2 years or so they change up their fleet and sell off the used vehicles. I got a 2017 Mitsubishi for ~7k, which gets 36mpg/city, 46mpg/hwy, shits fucking cash. It had 42,000 miles on it when I got it, but at least it was maintained decently at regular intervals though. It's nothing flashy, but it gets me from point a to point b and is pretty reliable and cost effective.

Just don't buy one of the newer jeeps they sell (Patriot I think?), they tend to have a ton of issues after a certain number of miles driven.

[Anonymous No.11966419]

>>11966337
Damn dude where do you buy a car from enterprise?

[Anonymous No.11966514]

You faggots are retarded. Buy a used Civic/Camry with 150K miles ans get another 200-300K out of it.

This is literally what I did when I got out of college and I'm 30 and have the same car. I've only spent $2000 on repairs over the past 8 years.

[Anonymous No.11966559]

>>11966514
2 minutes of searching. Haggle down to $3000. Will run 15+ years if you take care of it.

[Anonymous No.11966797]

>>11966559
>2008
>only 137k
>only 4k
holy shit this thing will run forever, this is like stealing

[Anonymous No.11966881]

>>11963790
lmaoing @ anyone who would pay more than $2k total for a car. The absolute epitome of not gonna make it.

[Anonymous No.11967117]

>>11963790
This is the way of the Aristocrat.