Slickdeals Saves U! Apply for our $2,500 Spring scholarships today Learn More
Forum Thread

Have a 0% car loan.. But i wanna trade it in

1,602 243 May 24, 2018 at 07:19 AM
Deal
Score
0
1,562 Views

Thread Details

0 Deal Score
1,562 Views
I have a 0% subaru legacy car loan, i think i owe 25k on it. probably 5k or so in the hole after trade in, anyway. I want to go bigger, whether it's the new ascent or whatever. What is your suggestion? Seems moronic for me to trade in a 2017 legacy with under 10k miles and 0% interest loan , for a new car that is going to cost me the +hole amount + new interest.

Just suck it up and keep paying off my current car and not upgrade?

13 Comments

1

Sign up for a Slickdeals account to remove this ad.

This comment has been rated as unhelpful by Slickdeals users
Joined Jan 2004
Here's to the future
24,945 Posts
691 Reputation
#2
Quote from Willwillx
:
I have a 0% subaru legacy car loan, i think i owe 25k on it. probably 5k or so in the hole after trade in, anyway. I want to go bigger, whether it's the new ascent or whatever. What is your suggestion? Seems moronic for me to trade in a 2017 legacy with under 10k miles and 0% interest loan , for a new car that is going to cost me the +hole amount + new interest.

Just suck it up and keep paying off my current car and not upgrade?
If you are already underwater on the loan you will dig an even deeper hole by trading it in. But it's your call and your money. I've been there and done that. About ten years ago I bought a car that turned out to be just too small for my wants and needs and traded it in after a year. Took a big hit but eventually worked out of the hole and paid off the new one early.
The smarter financial move would be to keep what you have and upgrade when it is paid off or at least when it is worth more than what you owe if that ever happens. But if you really need the bigger size just be aware of where it puts you financially and pay as much extra on the loan as you can. Gap insurance would be pretty important as well if you end up owing a lot more than the new car is worth just in case it gets totaled or stolen or something.
Reply Helpful Comment? 0 0
I like what she said, not what it means.
This comment has been rated as unhelpful by Slickdeals users
Joined Dec 2009
L6: Expert
1,602 Posts
243 Reputation
Original Poster
#3
I agree with all that. It's the 0% that makes it hard to decide. Why pay interest when i have a no interest loan lol. Probably smartest move would be to lease a car at a good deal and just keep paying my monthly 0% payment till paid off. Or stay status quo which is also an option
Reply Helpful Comment? 0 0
This comment has been rated as unhelpful by Slickdeals users
Joined Jul 2006
L6: Expert
1,039 Posts
141 Reputation
#4
Keep your car and do not upgrade. Better yet, sell the car and buy a larger used vehicle for less money.
Reply Helpful Comment? 2 0
This comment has been rated as unhelpful by Slickdeals users
Joined May 2017
L6: Expert
1,039 Posts
140 Reputation
#5
Call your lender and ask for your payoff amount,next determine the value of your car you can pay the difference yourself, fully paying off the loan. You'll have to come up with the money from somewhere else, but the loan will be paid off.
Without the extra money to pay off the loan, however, you will need to roll the difference into the purchase of your next car.if you trade in the dealer will add 10% to the new loan in the long run if you roll over the difference to a new loan. This can lead to being upside down again, starting the cycle over. If at all possible, pay off the loan and do not let it roll over.

https://www.creditkarma.com/auto/...-car-loan/
Reply Helpful Comment? 0 0
This comment has been rated as unhelpful by Slickdeals users
Joined Nov 2014
L3: Novice
111 Posts
26 Reputation
#6
Quote from jagojago
:
Keep your car and do not upgrade. Better yet, sell the car and buy a larger used vehicle for less money.

Best advice you are going to hear!!! Biggest trap is the 0% loan, you already lost $5000.
Reply Helpful Comment? 0 0
This comment has been rated as unhelpful by Slickdeals users
Joined Oct 2010
L9: Master
4,448 Posts
1,037 Reputation
#7
Quote from jagojago
:
Keep your car and do not upgrade. Better yet, sell the car and buy a larger used vehicle for less money.

Bingo. New cars are terrible buys imo. The second you take it off the lot it loses a significant amount of value. 1-2 year old used cars can usually be bought at anything from 15-33% less than new often with the manufacturer's warranty still largely in play (and you can always get an extended one if it is). And no one is able to rationally justify having the car for an extra year or two vs the amount of money saved.

The arguments you often hear against this is that the prior owner may have abused the car or not maintained it. While that is certainly a possibility, you take the chance that you do not get a lemon with any car purchase, new or used. If you do your homework and due diligence in getting the vehicle checked out, you will usually be fine and save a lot of money. My 2 cents.
Reply Helpful Comment? 0 0
This comment has been rated as unhelpful by Slickdeals users
Joined Sep 2006
L5: Journeyman
760 Posts
134 Reputation
#8
Quote from YanksIn2009
:
Bingo. New cars are terrible buys imo. The second you take it off the lot it loses a significant amount of value. 1-2 year old used cars can usually be bought at anything from 15-33% less than new often with the manufacturer's warranty still largely in play (and you can always get an extended one if it is). And no one is able to rationally justify having the car for an extra year or two vs the amount of money saved.

The arguments you often hear against this is that the prior owner may have abused the car or not maintained it. While that is certainly a possibility, you take the chance that you do not get a lemon with any car purchase, new or used. If you do your homework and due diligence in getting the vehicle checked out, you will usually be fine and save a lot of money. My 2 cents.
This is normally the case, but there are some models that just hold their value too well. Things like Toyota trucks and SUVs, Hondas, etc. Usually the discount you get isn't great for the mileage, etc. and a new one can be had for not much more money and lower interest rates (if taking out a loan).
Reply Helpful Comment? 0 0

Sign up for a Slickdeals account to remove this ad.

This comment has been rated as unhelpful by Slickdeals users
Joined Aug 2006
L6: Expert
1,014 Posts
123 Reputation
#9
The main reasons for a new car vs used are better terms on loan and better warranty. Sometimes when those factors are considered the difference isn't as great but exact details matter.


In general though you should avoid new cars and drive your used car until it dies at least financially.

You don't seem to have a good reason to purchase a new vehicle. If you want to do it then of course it's your money.
Reply Helpful Comment? 0 0
This comment has been rated as unhelpful by Slickdeals users
Joined Jul 2005
killroy was here
10,896 Posts
1,312 Reputation
#10
Quote from YanksIn2009
:
Bingo. New cars are terrible buys imo. The second you take it off the lot it loses a significant amount of value. 1-2 year old used cars can usually be bought at anything from 15-33% less than new often with the manufacturer's warranty still largely in play (and you can always get an extended one if it is). And no one is able to rationally justify having the car for an extra year or two vs the amount of money saved.

The arguments you often hear against this is that the prior owner may have abused the car or not maintained it. While that is certainly a possibility, you take the chance that you do not get a lemon with any car purchase, new or used. If you do your homework and due diligence in getting the vehicle checked out, you will usually be fine and save a lot of money. My 2 cents.
except most states have lemon laws that protect new purchases.

my 2 cents. if you are buying a new car your intention should be to run it into the ground. i went the new car route and plan to get 15+ years out of my civic. also depends on the market and make. i got in after the cash for clunkers and the used car market was pricier then.
Reply Helpful Comment? 0 0
Quote from BiGspendr
:
Stick a milk bone us ur ass, and let the dog eat it. Works like a charm! http://i.slickdeals.net/images/smilies/emot-LMAO.gif
This comment has been rated as unhelpful by Slickdeals users
Joined Aug 2007
heartless
8,239 Posts
5,576 Reputation
#11
Having always owned a used car and switched to a new, I guess I am leaning more towards I will always buy new from now on. The used one had so many issues throughout the years that cost at least $1K a time. The new car, I've kept up with regular maintenance and haven't had to spend that much for the past 8 years. I, too, intend to drive it til it's completely done.
Reply Helpful Comment? 0 0
i thought shopping was addicting but shopping with coupons is my new high Lust
This comment has been rated as unhelpful by Slickdeals users
Joined Sep 2006
L5: Journeyman
760 Posts
134 Reputation
#12
Quote from noungning
:
Having always owned a used car and switched to a new, I guess I am leaning more towards I will always buy new from now on. The used one had so many issues throughout the years that cost at least $1K a time. The new car, I've kept up with regular maintenance and haven't had to spend that much for the past 8 years. I, too, intend to drive it til it's completely done.
Well, it depends on how used you've been going. Just a few years and under 100k miles? You should be fine. After that, you should expect to do some repairs. Stuff just wears out with use. The benefit to buying new is that for most cars you don't really have to do much for the first 100k miles, other than maybe brake pads and tires.
Reply Helpful Comment? 0 0
This comment has been rated as unhelpful by Slickdeals users
Joined Jan 2004
Here's to the future
24,945 Posts
691 Reputation
#13
Quote from ogp
:
Well, it depends on how used you've been going. Just a few years and under 100k miles? You should be fine. After that, you should expect to do some repairs. Stuff just wears out with use. The benefit to buying new is that for most cars you don't really have to do much for the first 100k miles, other than maybe brake pads and tires.
Subaru says brake fluid needs to be changed at 30K miles. I've owned roughly 30 cars over a 35 year period and I have never changed brake fluid in any of them.

Does it need to be done? Who knows? Good arguments can be made that it is a good idea.
But if you don't want to risk a warranty claim being denied because the maintenance scheduled wasn't followed is it worth the risk of not doing it?

Leasing is looking better and better to me all the time. I leased my current car (Subaru Outback) after years of telling others how stupid leasing is. I'm about 15 months into a three year lease and still think it was a solid decision for my needs. I'm comfortable with the financial aspect of it even if it costs a little more in the long run. If I continue to lease (and that is very uncertain at this point) I get to drive a new car every three years with the latest technology and safety equipment and it is always under warranty with no need to pay for an extended warranty.

In my current situation the lease allowed me to try a car I wasn't sure I would like once I drove it for a while. If I bought it and hated it I would take a big hit getting rid of it after 2 or 3 years anyway. As it turns out I do like the car and it meets my needs better than I expected. I may even consider keeping it at the end of the lease if the buyback price is a good value for what similar cars are selling at the time.

The biggest problem I see with leases is when people use them to drive more car than they can afford or if they typically drive a lot of miles. If I decide not to lease next time around it won't be for the financial drawbacks. I just feel somewhat limited in what I can do with the car. There are things I would like to do to the car and accessories I would put on it that don't make sense when I don't own it.
Reply Helpful Comment? 0 0
This comment has been rated as unhelpful by Slickdeals users
Joined Aug 2007
heartless
8,239 Posts
5,576 Reputation
#14
Quote from ogp
:
Well, it depends on how used you've been going. Just a few years and under 100k miles? You should be fine. After that, you should expect to do some repairs. Stuff just wears out with use. The benefit to buying new is that for most cars you don't really have to do much for the first 100k miles, other than maybe brake pads and tires.
The one I mentioned that cost at least $1K each time to fix was about 2 years old when bought, with roughly 30K on it. It was a Camry. It's a solid car but unfortunately it had so many issues to which I fixed and got the car to a point where it only needed the typical maintenance to get by. But again, it cost a lot in addition to what I intended to pay.
Reply Helpful Comment? 0 0
Page 1 of 1
1
Join the Conversation
Add a Comment
 
Copyright 1999 - 2018. Slickdeals, LLC. All Rights Reserved. Copyright / Infringement Policy  •  Privacy Policy  •  Terms of Service  •  Acceptable Use Policy (Rules)  •  Interest-Based Ads
Link Copied to Clipboard