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Valued Member
800scoreaspirations
Posts: 31
Registered: ‎10-08-2008

Did I make the right decision

My very loyal 97 toyota broke down on me a few days ago.  Before even trying to diagnose the problem I immediately went car shopping.  I have horrible credit. TRANS:550 EXP:579 EG:578.  I went to two dealers and both ran my credit(I cringed both times).  The first dealer told me that my scores were decent enough to get a $20,000 with a lower interest rate, but I would have to have a co-signer.  They told me because I am a waitress I don't claim enough to have the loan by myself.  The other dealership told me that I would qualify for a brand new Nissan Versa with a full three year maintanence and warranty package with no money down and $377 a month with a 72 term, but with them I didn't need proof of income nor a co-signer, but the interest rates would be 17%.  This dealership kind of hounded me to take the vehicle then and there, because the car and the finance deal would not be around tomorrow( they said they had a special relationship with the bank)  Does that sound about right?

I felt uncomfortable with the deal, because they were hounding me, and everytime I told them that I wanted to go home and think about it they dropped the monthly price, it was originally $489 a month with $1300 down. I am also very unsure about the economy, because I am a student and a waitress,  I am thinking about what will happen two years down the road.  I have been working diligently for a year to repair my damaged credit and I can see the light at the end of the tunnel.  So i went to get my Toyota fixed and the mechanic said it would be about $300, but everyone is telling me that I should have gone with the Nissan so I don't have to worry about my car breaking down on me.  They say in the end I will be paying the same amount anyway.  Did I make the right decision?

Frequent Contributor
AmyBoo
Posts: 328
Registered: ‎09-28-2008
0

Re: Did I make the right decision

Absolutely, you did the right thing!. That was your gut telling you that you wanted to go home. Your instincts are stronger than what you give them credit for. These people who are saying you made the wrong choice weren't there and they weren't uncomfortable... You were.

 

 

What you could do is take whatever the monthly payment for the new car would be (or what you could afford to pay for a new car payment) and put it in a savings account. That way if your current car does break down you have the money to repair it, if it doesn't you have a nice big downpayment on a new car or possibly even pay cash!(from a dealer that makes you feel comfy cozy!)

Frequent Contributor
cadavis0609
Posts: 435
Registered: ‎06-17-2007

Re: Did I make the right decision

I speak from experience when I tell you that if you had taken a loan at 17%, you would regret it for 72 months because unless you pay much more than the monthly payment every month, you will always be upside down. Besides, you drive a toyota, 300 bucks is a small price to pay, it will probably run another 50,000 miles before your next visit to the shop.
Sept 07 EQ 419

April 2012 EQ- 669 EXP- 680 TU-700= Proud New Homeowner!
Valued Member
800scoreaspirations
Posts: 31
Registered: ‎10-08-2008
0

Re: Did I make the right decision

You know that was exactly what I was thinking about doing.  I figured that by putting the $377 plus the $122 for insurance in the bank for like twelve months I could see how much my lifestyle would change and if I could actually afford it without struggling.  Does anyone have any tips for me bumping up my credit score a little quickly?  I have a student loan, but I am currently in school, so I don't have to pay it back right away, but it is reporting that the account is in good standing.  I have a secured credit card that I have been paying on time and most of the time in full for about twelve months.  And I recently just got a department store card.  I definitely have a few baddies on my report from the past.  So any tips?????
New Contributor
jedijennifer
Posts: 68
Registered: ‎04-08-2008
0

Re: Did I make the right decision

I think you made the right decision as well.  I just put $1200 worth of repairs (including new tires) into my 1999 Saturn last month.  Granted I could have just bought a new one, but my car will live another 75,000 to 100,000 miles!  That way I can also save up and hopefully just purchase the car I want in a couple years or have a great down payment for a new one.
---------------------------------------
GOALS:
2009: lower utilization, sell current house (moving to fiancee's house), 700 Club
2010: less than 3% utilization, car loan
2012: buy a farm
FICO 1/16/09: TU: 690 EQ: 635 EX: 659
Established Contributor
rmily
Posts: 670
Registered: ‎07-12-2008
0

Re: Did I make the right decision


800scoreaspirations wrote:
  I definitely have a few baddies on my report from the past.  So any tips?????

What are the baddies you are referring to? Please consider posting them on the General Credit Issues board to get some advice on what you might be able to do to raise your score and clean up the history.

New Contributor
Smrtshppr43
Posts: 68
Registered: ‎09-19-2008
0

Re: Did I make the right decision

You absolutely made the correct decision. Good for you to have enough balls to say no, you want to think it over. I bet the salesman is still calling you, isn't he? 

 

If you had gotten into a big pmt on a new car, you might have eventually felt financially stressed to the point you felt you needed to cut down on school in order to work more to afford it. Finishing your schooling is more important (in my opinion) than a new car, as long as you can repair the old one. 

 

Really, $300 is not much to pay for a car repair. Will it break down again tomorrow? Perhaps. But, even if you decide at that time to sell it and buy new, it's value might be more since you repaired the thing now. Unless the repair cost is more than the value of the car, we always repair instead of replace. Now, of course, other factors come into play, like how much are you on the road, etc.

 

I think banking the money you would have spent on a pmt and seeing if you can hang with that is an EXCELLENT idea. Brilliant, in fact. 

 

As far as the old "baddies" on your credit report. My advice is to make sure they all have a zero balance. If not, make a settlement offer to clean them up. Creditors often won't care about old bad accounts, as long as you indeed did pay them off. If the balances are zero, and the date of first delinquency is correct, I personally would not do anything other than continuing to pay all your current bills on time, and keeping your debt-to-income ratio low.  That shows you can handle having available credit without maxing out and going over your limits, which equals responsibility with money. I don't challenge correct entries on my credit report because to me, that is not honest. I did the crime, now I gotta finish doing the time. But if there are any mistakes, then by all means try to challenge it. But remember, they often sneak in there and reage those debts that would have been stale and have less impact on your overal fico score (stale meaning more than 2 yrs old).

 

Good luck on the cars. I know it is a tough decision whether to repair or replace. 

Regular Contributor
tunseeker1
Posts: 108
Registered: ‎04-06-2008
0

Re: Did I make the right decision


800scoreaspirations wrote:

  The other dealership told me that I would qualify for a brand new Nissan Versa with a full three year maintanence and warranty package with no money down and $377 a month with a 72 term, but with them I didn't need proof of income nor a co-signer, but the interest rates would be 17%. 



The part I would worry about is the maintnance and warranty package. What was the price on this? I wonder what warrenty they are giving on the 3yrs that is better then the normal Nissan warrenty.What services are they giving?

 

I come up with a beginning loan value of about 17,000. What was the sticker on the car?

 

I know these questions are a bit basic but it seems like many people are concentrating on the payments and not the sale price and the add ons that the dealership is adding into the price.

 

 I understand that you declined this car but here is some information that might be interesting to you.

Edmunds cost comparison

 

 

Contributor
cgmiller63
Posts: 139
Registered: ‎08-04-2007
0

Re: Did I make the right decision

You absolutely made the right decision. 17% is unreal!  Putting the monthly payment and insurance aside every month is an excellent idea.  I tell my kids to do this whenever they want to make a big purchase.

 

If you do decide to purchase a new car in the future, you may want to look at Scion. They are a Toyota brand and cater to the young college crowd.  Their new vehicles have set prices (no haggling) and their loans are tailored to your age group.  As a matter of fact, my son was 21 and fresh out of college with no credit he purchased a Scion xB for $15k and got a 7% interest loan with Toyota Financial Services.  Scions hold their re-sale value too.  My son traded in his 06 xB with 53K miles on it for $11k a couple of weeks ago when he bought his Tacoma.

Valued Member
800scoreaspirations
Posts: 31
Registered: ‎10-08-2008
0

Re: Did I make the right decision

It was a great package.  It included maintanence for the next three years, and I mean everything down to old changes and such. There was a three year bumper to bumper warranty.  they said that they gave me a 1000 rebate.  The car was quite nice,  and it was fully loaded with everything.  But when i did the math the sticker price was about 15000 after rebate but after calculating it came to about 27000 for the full term.  Don't worry I was concerned about monthly payments but i was more concerned when i calculated the total price in the dealership and I would be paying almost double what the car was worth.  I would take me a long time before I didnt owe more that what my car was actually worth.  Yes, I was born at night, but not last night.  I feel sick that I even considered it considering that I just found out what my real scores are.

tunseeker1 wrote:

800scoreaspirations wrote:

  The other dealership told me that I would qualify for a brand new Nissan Versa with a full three year maintanence and warranty package with no money down and $377 a month with a 72 term, but with them I didn't need proof of income nor a co-signer, but the interest rates would be 17%. 



The part I would worry about is the maintnance and warranty package. What was the price on this? I wonder what warrenty they are giving on the 3yrs that is better then the normal Nissan warrenty.What services are they giving?

 

I come up with a beginning loan value of about 17,000. What was the sticker on the car?

 

I know these questions are a bit basic but it seems like many people are concentrating on the payments and not the sale price and the add ons that the dealership is adding into the price.

 

 I understand that you declined this car but here is some information that might be interesting to you.

Edmunds cost comparison

 

 


 


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