I have a post in the other section regarding getting out of my Yaris and possibly trading it in on a Honda Fit. I owe about $9k on my car and it is roughly worth a little under $6k in trade. I would be taking up another loan for the Fit. I can get an 08 Fit with 30-40k miles on it for roughly $12k. I wouldn't mind something with four doors from a practicality standpoint. How does this come across as a financial move? Also, will this screw up my credit in the long run?
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Feb. 27, 2011 9:35 a.m. 92dxman HalfDork
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Feb. 27, 2011 9:47 a.m. 1988RedT2 Dork
It won't hurt your credit at all so long as you make your payments on time every month.
Not the greatest move financially, but newish cars are always a losing proposition. As long as you are comfortable with your new payment, you should drive what fits your lifestyle and makes you happy.
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Feb. 27, 2011 10:12 a.m. Dr. Hess SuperDork
If the wheels haven't fallen off the Yaris yet, then it is not a good financial move.
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Feb. 27, 2011 10:20 a.m. FlightService Reader
Financially, not smart. Credit is fine if you make your payments. If a bank will give you the loan (i.e. your credit is strong enough to be 25% upside down. That was limit on allot of loans BEFORE the crash.)
In the end are you willing to make a ~$300 to ~$350 a month payment for 5 years for a Fit?
If you are then go for it, but remember you are upside down in the Yaris, you will be buried in the Fit. You better like it because you won't be trading for a while, without paying alot on the next one.
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Feb. 27, 2011 10:56 a.m. iceracer Dork
Basically , you will be paying for two cars.
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Feb. 27, 2011 10:59 a.m. bastomatic Dork
I also think it's a bad move. I can't believe 3-4 year old Honda Fits are that expensive, firstly - we paid I think $14k for ours new in 2008. Secondly, selling a perfectly fine commuter car and taking a $3,000 loss seems excessive - it means the used Fit is essentially worth $15,000 to you. Is it?
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Feb. 27, 2011 11:01 a.m. xd Reader
That is a stupid move. so if they give you 6 for your yaris and and you roll the other 3k into the fit loan you are going to be paying around 15k for an 08 Fit with 30-40k. and 2011 fits start at $15,100 with 0 miles and that new car smell. + its a used car so your interest rate will be jacked up. Whats the book price of an 08 Fit with 30-40k? You are just going to be upside down again. Just suck it up and pay off the Yaris.
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Feb. 27, 2011 11:20 a.m. oldsaw SuperDork
What's wrong with the Yaris that the Fit will fix?
The Yaris may not be as much "fun", but a little help from the aftermarket will fix that for a lot less than financing a used car. If you need more room for "stuff", a good roof rack or a re-evaluation can fix that pretty easily, too.
Recommendation is to stick with what you have, pay it off asap and then look at alternatives. YMMV.........
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Feb. 27, 2011 11:22 a.m. BoxheadTim SuperDork
Financially I'd say it's not a very good move to put it mildly. Pay off the Yaris as quickly as you can if you want to get out of it, then sell it (don't trade it in) and buy something else.
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Feb. 27, 2011 11:33 a.m. JoeyM SuperDork
Dr. Hess wrote:
If the wheels haven't fallen off the Yaris yet, then it is not a good financial move.
+1000 Drive it until you can't drive it any more.
What's your issue with the Yaris? If you need something more fun, buy an approx. $2k beater/track rat that you can thrash without mercy
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Feb. 27, 2011 11:33 a.m. Datsun1500 Dork
Look at the math and you will see that it is not a smart move. $12,000 for the Fit $360 for tax (here in MD, 6% on the $6,000 difference between cars) $200 for fees (assuming it's not more, tags stay with the car, etc.)
$12,560 - $6000= $6,560. Add back the $9,000 payoff for a total of $15,650. Can you get a $15,000 loan for a $12,000 car? Do you want to own a 3 year old Fit for $15,000?
Assuming you stretch it out (and can get it financed for that long) and do a 5 year loan with $1000 down. Your payments are $290 a month. After 2 years you still owe $9,000 on a 5 year old $15,000 MSRP car. Put the $1,000 towards the Yaris and pay the same $290 for 2 years and you owe less than a grand.
What do you want in 2 years? No car payment or another post asking if you should trade the car?
Honestly I think you will have a hard time finding a bank to do it. The above payments are at 7%. Do it at 12% and the payments are $325
