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Login to post Forums » Off-topic discussion » Good DD options under $8k

Jan. 20, 2012 9:47 a.m. Drewsifer Dork

So I'm considering trading in our 2010 Suzuki SX4 for something more used. I've called around and most places said they would give us between $5500 and $6000 for it (we still owe money on it). I was planning on using a small loan from a local credit union to make up the difference if necessary. I'm considering doing this to help lower our debt (taking away 4k in debt is always a good plan).

So what's a good DD for my wife that's under 8k? My criteria

Automatic 2000 or newer Sedan, hatchback, or wagon Less then 60k miles

Civics are the always popular choice, but they seem to be a little scarce in my area (orlando). Here are my top contenders right now.

2001 Ford Focus http://tinyurl.com/6umfmg5

2001 Saturn L300 http://tinyurl.com/8xccfqb

2007 Suzuki Forenza http://tinyurl.com/7pzdol8

Your thoughts?
Jan. 20, 2012 10:10 a.m. jrw1621 SuperDork

My first thought is keep the car you have.

How much equity do you have in the 2010 car?
The issue with buying a different older car is that you can typically not finance it as long. Therefore, your monthly payment may actually increase for an older car. Can your personal budget handle that larger payment?
Through typical bank financing, a car more than 10 years old will not allow financing for more than two years, if allowed at all. In addition, the interest rate will be high.

In quick math, a $5,000 car loan over 2 years @10% interest will have a monthly payment of $230 per month.

$5,000 paid in one year @10% is $440.
How does that compare to your current loan?

I would start by going to the Credit Union and getting pre-approved. While there, get and understanding of what rates and length of loan available to you.
Jan. 20, 2012 10:18 a.m. Drewsifer Dork

jrw1621 wrote:

My first thought is keep the car you have.

How much equity do you have in the 2010 car?
The issue with buying a different older car is that you can typically not finance it as long. Therefore, your monthly payment may actually increase for an older car. Can your personal budget handle that larger payment?
Through typical bank financing, a car more than 10 years old will not allow financing for more than two years, if allowed at all. In addition, the interest rate will be high.

In quick math, a $5,000 car loan over 2 years @10% interest will have a monthly payment of $230 per month.

$5,000 paid in one year @10% is $440.
How does that compare to your current loan?

I would start by going to the Credit Union and getting pre-approved. While there, get and understanding of what rates and length of loan available to you.

Your example is higher than our current car payment but I feel like you didn't read what I said. I wouldn't be financing $5000. I would be financing at most $2000 and probably more considering the cars I'm considering are well under my $8000 price limit.

But calling a credit union for preapproval never hurts.
Jan. 20, 2012 10:28 a.m. MadScientistMatt SuperDork

Drewsifer wrote: So what's a good DD for my wife that's under 8k? My criteria

Automatic 2000 or newer Sedan, hatchback, or wagon Less then 60k miles

I was thinking BMW E36 when I saw the thread title - then I realized it was for your wife and she has more appliance requirements than car guy requirements. (My wife's much the same way.

2001 Ford Focus http://tinyurl.com/6umfmg5>
Pretty rare to see a 2001 Focus sell for more than the change you can fit in the cupholder, although it's also a bit odd to see one with that low mileage.

Not too familiar with the others, but one choice that came to mind is the Chevy Cavalier / Cobalt. They are rather rough edged, but have no resale value, so you can get a pretty new-ish one for the money.

Jan. 20, 2012 10:28 a.m. 02Pilot Reader

I would avoid the Forenza like the plague. I had one as a rental a few years ago; it was the flimsiest vehicle I've ever encountered in the U.S.
Jan. 20, 2012 10:38 a.m. Gasoline Reader

I would avoid the Toyota Yaris also. Just turned one in after renting it for a business trip.

Felt like I was driving an ugly shoe all week.
Jan. 20, 2012 10:40 a.m. jrw1621 SuperDork

Yes, I thought you were getting $5-$6,000 as trade in for the Suzuki. What I know think you are saying is you get $5-$6,000 in cash equity after trading in (selling) the Suzuki. Then by adding $2,000, you get to a $8,000 purchase. Right?

If that is the case, see if you can forgo the little $2,000 loan and buy something from private party for the straight up $6,000.
Jan. 20, 2012 11:02 a.m. Brett_Murphy Dork

Mazda3.
Jan. 20, 2012 11:04 a.m. Javelin SuperDork

jrw1621 wrote:

If that is the case, see if you can forgo the little $2,000 loan and buy something from private party for the straight up $6,000.

THIS
Jan. 20, 2012 11:26 a.m. Klayfish HalfDork

Javelin wrote:

jrw1621 wrote:

If that is the case, see if you can forgo the little $2,000 loan and buy something from private party for the straight up $6,000.

THIS

Piling on....THIS

If you're looking to reduce debt, but still have a reliable transportation appliance, get a 6 year old Corolla or Civic. Bypass the Focus or Saturn.
Jan. 20, 2012 12:08 p.m. 93EXCivic SuperDork

Gasoline wrote:

I would avoid the Toyota Yaris also. Just turned one in after renting it for a business trip.

Felt like I was driving an ugly shoe all week.

I drove with Tien suspension and sticky tires and a manual and it was decently fun.
Jan. 20, 2012 12:20 p.m. Bobzilla SuperDork

06-08 Spectra5. Cheap, easy to maintain, fun to drive and lots of room.
Jan. 20, 2012 12:55 p.m. Drewsifer Dork

I had considered trying to do this through private sales (selling our car and then buying one). The only problem is my wife is the bread winner while I'm in school. So the time without two cars would have to be as short as possible. I'm just concerned that trying to do a private sale and purchase could get messy and wind up with us being in a bad position.

I'll check out of the Spectra5 and keep hunting for Civics.
Jan. 20, 2012 1:44 p.m. Duke SuperDork

Drewsifer wrote:

I'm just concerned that trying to do a private sale and purchase could get messy and wind up with us being in a bad position.

You can always rent something cheap for a week or two to tide you over, if necessary, for a couple hundred bucks at most.

I don't know what you owe on the SX (and don't need/want to), but it doesn't seem like it could be all that much. But if you're taking the depreciation hit on this car now just to reduce your debt balance, I would avoid wasting that initiative by borrowing more money (even a reduced amount). I'd rather just run out the life of the current loan and own the SX free and clear, or (as a distant second choice) buy something within the equity value of the SX.

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