Major Car Connundrum.. advice wanted please :) - Mothering Forums
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#1 of 8 Old 05-11-2011, 06:36 PM - Thread Starter
 
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Here goes :)

 

We have a 2002 PT Cruiser that is basically a piece of junk. It's leaking coolant, oil.. Check engine light is on, emergency break light is always on, it shudders, etc. We've taken it to a mechanic who says he can't find the problem, etc, etc.

 

 

We have emissions testing in August which we know it will not pass.

 

We are having a baby in December.. which will pop us up to three kids. While I know it's def. doable in the PT I'd prefer to have something with more room.

 

We still owe approx 6k on the PT Cruiser, which we have available to pay the car off.

 

 

BUT, we just thought of another idea. We would like to purchase a used, more reliable, preferably larger with better gas mileage (I'm getting like 17 now) for around 12k. We have 2k to put down, knocking it down to 10k. We think we should be able to get at least 2k on the PT.

 

Should we pay off the PT, go straight into the next car loan.. droping it down to approx 8k?

 

OR

 

should we keep the 6k... roll over the loan into a loan with a better interest rate (PT is at 14 percent, but we were able to get 2.99 recently when we purchased my husbands car), then just use the 6k to pay double on the new car loan? So the purchase price of the new car would be 12k - 2k we have available + 4k on the car loan = 14k which we believe we will get anywhere from 2.99 to .99 interest rate depending on what car we go with..

 

So basically the way I'm seeing it, we would have a car loan of around 14500 (with taxes and all that), and the payment would be approx 260 a month. We could use the 6k to pay on the loan PLUS the 150 we were planning on spending in the first scenerio..so we would be able to pay it off relatively quick.

 

Am I missing something?


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#2 of 8 Old 05-11-2011, 11:30 PM
 
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From my experience negative equaity in a loan does not get you the best terms/rate.


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#3 of 8 Old 05-12-2011, 06:31 AM
 
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It doesn't sound like the most ideal situation but it sounds like there isn't much else you can do, your car isn't safe for 2 kids and a baby... is it? It sounds like our 98 Plymouth Breeze that DH limps back and forth to work. He puts water in it every day, sometimes twice a day. One of these days it is just going to disintegrate into dust! But at least it was a free car that was passed through the family! By the way, what makes you think you can get $2k for your PT Cruiser if it is a piece of junk? Just wondering... GL!

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#4 of 8 Old 05-12-2011, 06:46 AM
 
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I would pay off the PT and then trade/sell/whatever will get you the most $$$

Then buy the new car & put as much down as possible. Honestly, I'm not a fan of car loans and feel they should be minimal so I would look for a cheaper vehicle than $12K if you only have $2K to put toward it... but obviously with gas prices so high, MPG is pretty important and might be more of an issue with an older (cheaper) car...

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#5 of 8 Old 05-12-2011, 07:05 AM - Thread Starter
 
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The reason I think we will get 2k is we just traded in another pt with more miles for 2k.

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#6 of 8 Old 05-12-2011, 07:17 AM
 
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I agree that you probably won't get a super-low interest rate (less than 3%) on a used car. We just bought a used car, and even with a very high credit score, the best rate I could get was 3%. But that's still a whole lot better than 14%!

 

I don't see how it's possible to get a car loan for more than a car is worth. Our credit union looked up the value of the car we were buying, and that was the maximum they would loan us. So you idea of rolling the PT loan over into a new loan can't really happen.

 

I also agree that you might be able to get a decent, reliable car for less than $10K. Pay off the Cruiser, and get rid of it - thought with the mechanical problems you describe, I'm not sure you'd get much for it. You'll get more selling privately than trading in, but you still have to be honest about the problems. As a trade-in, in poor condition, $2K might be pushing it.

 

Before you agree to buy ANY new vehicle, have it checked out by a mechanic you trust. It will cost you about $100, but will give you the peace of mind of knowing you're not buying a car that needs a $3000 repair in 6 months. You might also get some ammunition for egotiating a lower price, if the vehicle is basically sound but has minor problems.

 

Good luck!


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#7 of 8 Old 05-12-2011, 08:05 AM - Thread Starter
 
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ThankS! The reason I'm site we can get that sort of rate is we are buying certified. Buying certified opens you up to getting a good interest rate. Right now Mazda is offering as low as .99. The Toyota dealership here is offering 2.99 which is what we just got on our certified scion. Now I'm not sure about how it works with rolling over a loan. You may be right that from a credit union they may not allow it but I know financing from the dealer it is an option.

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#8 of 8 Old 05-12-2011, 07:50 PM
 
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I don't like owing money on cars, so what I would do...

 

 

Take the 6K you have available and just outright buy a used vehicle that will suit your family, use the rest to pay of the PT (try to sell it if you want). It's totally possible - I have two vans, each purchased for under 2K within the last two years that have needed very little in the way of repairs. I think it was around $400 to do some repairs on the Honda, the back hatch needed to be replaced, the Caravan needed a $15 part at one point. Other than routine maintenance, they haven't cost me anything in the way of repairs. They are old, not very fancy, but they are mine and I don't have to worry about paying for them each month. When they need repairs that I don't want to pay for, or are extravagant for the age of the car - I will use my savings to buy the next vehicle.


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