)% APR - Would U put $ Down or at least pay TAXES & Fees??

[runNL8]

I'm am considering buying a new truck to take advantage of GM's 0% @ 72mo on 2009 models. It works out better to take the 0% -v- Incentives on the vehicle I am looking at according to Edmunds loan calc.

Would it be a good idea to pay the taxes, title/reg & doc/dealer fees + a little more for down payment? If I did, it would shave about $100 off the payment. Not a big deal sense I can afford it either way. Just thought I'd ask for some ideas. 

[Anonymous]

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@runNL8 wrote:

@I'm am considering buying a new truck to take advantage of GM's 0% @ 72mo on 2009 models. It works out better to take the 0% -v- Incentives on the vehicle I am looking at according to Edmunds loan calc.

Would it be a good idea to pay the taxes, title/reg & doc/dealer fees + a little more for down payment? If I did, it would shave about $100 off the payment. Not a big deal sense I can afford it either way. Just thought I'd ask for some ideas. 

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It really depends on your situation.  How much in emergency and savings reserves do you have?  How tight is your budget and how will the $100 per month impact you?

It also depends on the long run and resale.  The less you put down, the more upside down you will be in the auto should you want to resell prior to PIF. 

Since the loan costs no interest, then you aren't paying a penalty to finance it.   But considering that you may need to sell the vehicle prior to 72 months, you would have to come up with a down payment when you might least afford it....because you can't sell if you are upside down unless you come up with the difference.

You should really look at not only the purchase, but the term of loan and exit strategy.

Message Edited by txjohn on 11-27-2009 08:07 AM

[runNL8]

The vehicle I am looking at is a high demand resale vehicle. It's a 3/4 ton p/u with a diesel engine. Being a diesel, it's resale is statistically higher -v- a gas engine p/u with equivalent options. I, as well as auto market industry professionals predict the increased demand of this particular vehicle knowing that the manufacture will be suspending production of this particular diesel in FEB 2010 and will resume it's production in the near future.

The $100 difference would not impact me at all, my DTI, currently right is less then 25%. I have always kept my vehicles for longer then 4yrs, if I kept this truck for 4 yrs I would have paid more then half the balance off and I figured resale at 4 yrs would be 1.5 - 2x the amount owed on the loan @ 24mo if I had to sell, I could walk away from it breaking even or very close to it.

If I paid the TTL doc fees I finance 5K less. When I work the #'s at 48mo (5K dn -v- 0 dn) I end up with a balance difference of $16XX. So this is where I'm on the fence. Do I drop the 5K to cover TTL, or take that 5K and put it into an interest earning account. If I have to sell the truck and end up upside down, I'll have the 5K that was earning interest to cover any neg. equity.

txjohn--thanks for the advice, any others would be much appreciated.

[Anonymous]

Assuming you will have no problem getting financed at full price +,+,+

it boils down to

1- money down alters your monthly payment number

2- money down effects the equity situation in the vehicle.

Be aware that nothing down, financing all of it and the vehicle being "totaled" 16 months post purchase can leave you owing significantly more then the insurance will pay out.

Also: If you are not planning on going out longer then 48 months, you really do need to check against rebates offered vs an interest rate you would expect to get for the loan if you put money down.

In general i never like making 24/36/48 month predictions on what your vehicle will be worth, since there are so many different factors that could play into that.

Believe me, try to unload a convertible in Minnesota in January....

Or 6 months after purchase they could get really bad reviews in trade magazines as problem child production runs.

Definite case of speculation.