jokerstars

I bought my 5.0 with the assumption that I would be paying rent for the next 4-5 years and since I don't live in DC proper, I do need to drive this car 3-4 times a week (not for work, though. I use public transit for that).Well, I found an amazing condo in the city but that means my monthly house payment's going from 900 (rent) to 1650 (mortgage). OUCH.

I love this car. I love the Borla S-Types, my custom ball-shifter, glass roof, and tinted windows. I love the Sync, rear cam, and comfy seats. Yet, it doesn't make financial sense to pay $640 a month (this includes insurance) for the next four years for a car I am going to drive LITERALLY once a week and put maybe 3,000 miles on it a year. I can't justify it. My place in DC is extremely close to the bus stops and metro and parking in DC is almost as bad as NYC.

Does anyone have any recommended "trade downs"? My car is worth more than is owed on it by about $7,000 dollars and I have another $8,000 to chip in for a used car (or pay down my existing loan if I decide to keep it). Please lend me your thoughts and opinions. Before you reactively say "keep it", remember this is $650 a month for the next 4+ years for a car I will be driving literally 3,000-5,000 miles a year. Even less once I move to DC.

I've noticed some Z4's with low mileage for 13k or some used Infiniti coupes G35's for 15k. Assuming 8,000 of my own to spend in either scenario, the options are:

1) Keep the car for $640 (90 of this is insurance) a month for the next 3+ years

2) Get a low mileage used car $70 dollars a month (just insurance).

Any used car I buy would have less than 60,000 miles.


INPUT PLEASE!

xlover

expected income growth rate is probably the most important factor. also does the condo have a parking spot, not having a parking spot deeded with the condo is a challenge to keeping any car, you might want to get rid of it or anything decent if you have to endure street parking. if you dont have a deeded garage space and are a car person you might want to buy something cool again when your income increases to support it and it would suck to not have a space.....

I assume if you are buying a condo you feel your income source is pretty secure, if you are really not planning on driving it that much and you have 7k in equity it might be worth it for you to put the 8k into the current payoff and refinance the car over a longer term to reduce the payment and keep it for a while? i wouldnt recommend overleveraging yourself and I also dont know what your new car itch will look like in a couple years.

if you cant keep the stang i recommend an 07-08 fusion preferably AWD, the 08s have sync and AWD will never let you down in bad weather. i had an 07 it was sporty for a midsize sedan.... if you are not going to be doing much "driving" why not get an appliance car to simply life till you can get another real fun to drive one

LEwis26

I would definitely recommend trying to keep it to get out from being negative on your loan. It just doesnt make sense to throw away that $7k.

05stangkc

Sounds like you don't have to sell it this very moment. Why not give it 2 to 3 Months and see how everything pans out. The car is likely to be easiest sold when the weather is great and the Fun car buying bug is at it's Peak.

You got a lot on your Plate at the moment. You may also get your insurance down a bit if you tell your Agent your only driving a small number of miles.

Also I do not know what your interest rate is on your loan but in the past I had cars financed and then got a credit union special refi at a very low rate. Something to consider.

If you really want to keep the car you will figure a way, If you have made up your mind that you can't do it. The car is going to go.

Quotable Quote { When a man BELIEVES he is beaten He is! } Believe in yourself you will find a way.

Btmo,

KC

jokerstars

Thanks for opinions, keep 'em coming.

Yes, my condo has a huge underground garage parking space that is deeded to me. I am really averse to getting anything that isn't badass or luxurious. (My freshly detailed 5.0 got tons of positive attention driving around DC today, much moreso than the hordes of foreign import luxury cars that roam the streets).

I REALLLLY want to keep this car from a heart and soul point of view. From a wallet/near-future point of view...not so much.





Oh, and that stupid rear cam has spoiled me. So awesome for backing out of parking spaces at grocery stores and parallel parking.

jokerstars

More info:

I owe about 25k on the loan. I got a 3.25% interest rate. My agent is aware of my low mileage.

Yes, good call to wait...better to get the condo closed before I worry about sellingt. I think the Z4 3.0 is really awesome looking and performing, but soft top in winter makes me say 'meh'. G35 coupe looks cool, but that thing is heavy (5.9 0-60 is slowwwww, Z4 does it in 5.4).

Agent

Jokerstars, I am so sorry to hear about your car dilemma. I think you and I were just about neck and neck last summer waiting for, and taking delivery of, our 5.0's.

I'll just throw out some possibilities in the $13-$15K range...
Ford Mustang V8 '04-05
Infiniti G coupe '04, sedan '05
Mazda Miata '05-06, '07-08
Mercedes CLK '03
Porsche Boxter '02
Subaru Impreza WRX '06

I will probably draw down the wrath of others on this forum for saying this, but I wish I had taken the time to test drive a WRX. They sound like they would be fun. The AWD would have been attractive for my snowy winters.

Good luck with your decision. If you're lucky, your condo will appreciate to the point that IT pays for your next Stang!

xlover

here is another thought, layout your desired savings rate, expected income growth rate, then take your 8k that you would be willing to part with for a different vehicle and use it as a buffer to maintain your current savings rate in the new place, it will cover basic ownership costs for 12-14 months all other things being equal hopefully you will see some income growth in that period of time that will offset the hit to savings rate you will take when the 8k "runs" out. remember if you are willing to part with the 8k right now in order to step into something else why not use it to keep your current ride...


all else fails, apply liberal use of chaos theory "life will find a way" just keep the car dont change anything and it will all just work out... trust me its fine

jokerstars

Well, Obama froze my cost of living for two years. I'll get 2500 raise a year for the next two years but then it will slow to every two years then every three years. Either way I don't think it offets the massive cost of 650 a month.

(puts on flame suit for being a fed)

Ministang

How many hours a week do you work? Do you have evenings and/or weekends free? If so, you could get a part-time job for another 10-15 hours a week to help make ends meet and keep your Mustang. If it isn't worth losing that time to another job, then maybe you aren't that attached to it. Another option would be to cut back in other areas of your life to keep the Mustang. Most people could cut back on eating out, their cell-phone bill, cable bill, alcohol consumption, entertainment costs, etc if they really need to. I've done it myself in the past for a couple of years to meet a particular financial goal.

Since you said you have $8k to put towards another used car (or pay down your existing loan), another option would be to pay down your loan with that $8k, and refinance for as long a term as possible (72 months?) to make your payment a lot lower.

Thomas S

Maybe you shouldn't get a condo you can't afford. You could also consider refinancing your car for a longer term. If you only owe $25k your payments could go much lower.

ssimaniac

I wouldn't sell the car. Being flipped upside down is never pretty. Why DC is I may ask? If someone offered me a free condo there, I wouldn't move. Traffic is horrible, streets are impossible to drive on and crime rates are horrific.

Why not buy a condo in Arlington? I do real estate, if you need any help let me know. But, I wouldn't let go of the stang.

jokerstars

If I had infinite funds I would definitely buy in Ballston/Clarendon/Courthouse/Rosslyn. But one bedrooms there START at like $350,000. I bought a brand new 1 BR in DC for $250,000 that includes parking (it's in a rapidly gentrifying area).

I even took a look at a studio in Clarendon yesterday but the thing was so darn small (500 sq ft). Great location though, I agree. Northern VA is a bit homogenous once you go east from Ballston, but there's lots to do and it's safe.

MRGTX

The bottom line is that the cost of your Mustang can only be justified by how much fun and enjoyment it brings to your life.

There is probably no reason in the world that a frumpy old 2003 Honda Civic wouldn't suit your needs... so if the 'Stang is going to bring more stress than joy into your life, unload it.

If I were in your situation, I would sell it and pick up a nice 1999-2004 Mustang GT, slap some loud exhaust on it and move on. You'll get 85% of the fun for 1/4 the cost.

And no flames about your job!! Thanks for serving our country!

ssimaniac

Depending on the budget, you can find a lot of nice places in NOVA. Falls Church, etc. Only thing with condo's that sucks is the condo fee.

Every time I drive my GT to dc, it feels like I have to change my suspension from their brutal roads. Don't get me started on parking and door dings

While I do agree that it's the perfect time to buy a place, I don't condone selling the GT. Why not buy a 2BD condo and rent 1BD out? Helps with cost. I just saw a 2BD 2.5 bath right on west falls church metro for 370k. Mortgage is like 2.6k on it but they rent for same. Go figure.

jokerstars

Cool. And if you think DC roads are bad, you should see the roads around Merrifield/Dunn Loring. Good lord!

Thanks. I wasn't too worried for the shut down because I was deemed essential to national security.

SVTJayC

Wow...EVERYTHING wrong with the fiscal mentality of this country summed up in 1 post. Bravo Sir.

LEwis26

What lovely, helpful advice.

What was the point of even posting?

SVTJayC

What "Advice" does he need? If you can't afford the car, sell the car. End of story. People waxing on about income growth rates, etc. are the same people that bought houses they couldn't afford, assuming they could flip them down the road. It's sickening. Sorry.

I'm from the school of tough love. Sell the car, they literally makes hundreds of thousands exactly like it every year. It's not special. A piece of real estate on the other hand, in a desirable area, at the rock bottom prices they are going for now, could be a once or twice in a lifetime situation.

And never make "assumptions" 4-5 years into the future. You shouldn't even assume you'll be in a house you BUY in 4 years.

jokerstars

I could afford the car payment and my morgage. It would just a tad uncomfortable. Well, a bit. Somewhat. I'd have less money than I like for my yearly roth IRA.