How to count breakeven for 2nd hand car?

[Titanium]

Kinda blur in calculating loan breakeven for 2nd hand 3yrs old car.

 

Example... example only...

 

Price - $44,800

Reg date - 12-Jan-2005

COE - $20,200

OMV - $19,700

 

maximum loan shld be 7 yrs since is a 3yrs old car.

 

Assuming $0 downpayment, interest 2.98%(Normal for 2nd hand car loan?)

 

Need to take how long to breakeven leh?

Edited December 26, 2007 by Titanium

[Diehardsu]

What is your monthly repayment & how long, then only can work out

[Kyojin]

http://singaporemotoring.blogspot.com/2007...cussion-on.html

 

there's a tool you can download from here to calculate

[Titanium]

Edited...

[Titanium]

Which one? for new car, i know how to count.

 

But for 2nd hand, i a bit confused wor...

[Zanter]

Depends on ur deposit or kinda loan package & interest rate? Some banks will impose a penalty for redemption? Also depends on ur resale value. I suspect however that if u take a 100% 7 year loan on a 7 year car, u wont breakeven till on 6th year. Just like u take a 100% 10 year loan on new car

[Roh96]

You can try to do a breakdown of its paper value from 5th to 10th yr and also do the same for your loan repayment. Once the paper value > outstanding loan, breakeven liao. I did a rough calculation based on your description but at 2.95% interest. You can add on the paper value to my data to see when is the breakeven. Cheers.

 

End of year > Outstanding loan

1 > 46330

2 > 38608

3 > 30886

4 > 23165

5 > 15443

6 > 7722

Edited December 27, 2007 by Roh96

[Emperor]

eh... how come I dunno got such tool available?????

[Redwood]

Assume the price of Car with COE = $44800/- (unlikely because OMV so high)

Please provide value of car at purchase.

 

If price of car with COE is really = $44800/- then,

The breakeven is 29 months. Breakeven on May 2007.

 

As of Dec 07, PARF Rebate = $16252.5, COE Rebate = $14140,

Interest Rebate (Rule 78) = 3078.45, You can get back $2530 upon scrap.

 

http://www.xxxxxxx.com/pdb/carloan.php

Edited December 27, 2007 by Redwood

[Titanium]

Oh thank, i did a calculation... If i not wrong, it will only breakeven ard 3 yrs.

 

I asking this becos i wondering issit worth for me to change my current 4yo ride to a 2nd hand 3yo ride, and ride for maybe another 2 yrs then scrap.

[Titanium]

Hmmm... r u calculating based on new car?

 

I talking abt breakeven for a 2nd hand car...

[Roh96]

Is it worth it? Changing your 4 yrs old car to another 3 yrs old one don't really save much $$ leh. My car also coming to 4 yrs soon and i did ponder on this idea before but don't really make much sense to me. Dealers will be taking my car at paper + body, yet i have to pay market value for the next car(2nd hand somemore). What i gain is only 1 yr plus of additional car lifespan. Are you planning to upgrade your car to a bigger one?

[Titanium]

ya loh... tat y must count properly mah, if nv count i dunno mah...

 

Quite tempted in opel astra 1.6 MTA...

[Redwood]

Bro, you're right i'm calculating for new car.

 

For old the calculation I have implemented in a spreadsheet.

I calculated if you take over this car on Dec 07, your breakeven period will be 55 months from Dec 07.

 

I have attached the spreadsheet. I assume that scrap metal value is 0.

Breakeven for Old Car.xls

Edited December 27, 2007 by Redwood

[Titanium]

Wah... u excel expert huh?

 

Ur spreadsheet look chim leh...

 

Btw, thank for ur effort, i will try to understand...

[Redwood]

Some insight,

 

To calculate break-even period, we're trying to solve the equation,

PARF rebate + COE rebate + Interest Rebate + scrap metal value - Outstanding Loan - Bank penalty >= 0

 

1. I assume scrap metal value = 0, and bank penalty = 0.

2. Since the car is a 2005 car, the ARF = 1.1*OMV.

First 5 years, PARF rebate = 0.75*ARF

5 to 6 years, PARF rebate = 0.7*ARF

>6 to 7 years, PARF rebate = 0.65*ARF

>7 to 8 years, PARF rebate = 0.6*ARF

>8 to 9 years, PARF rebate = 0.55*ARF

>9 to <10 years, PARF rebate = 0.5*ARF

3. Interest Rebate is calculated using rule 78.

4. For COE rebate, you need to calculate remaining COE after taking over the car.

 

Happy calculating!!!

[Skxly]

Hi all,

I have traced this thread from my blog and realized that my Cost of Ownership worksheet did not cater to Used Cars. So I have make a version to help you to find the "break-even" point when picking up a motor loan for a used car.

 

http://singaporemotoring.blogspot.com/2008...p-for-used.html

 

Cheers,

skxly

[Nastrix]

Hi all,

I have traced this thread from my blog and realized that my Cost of Ownership worksheet did not cater to Used Cars. So I have make a version to help you to find the "break-even" point when picking up a motor loan for a used car.

 

http://singaporemotoring.blogspot.com/2008...p-for-used.html

 

Cheers,

skxly

 

 

bro tried ur spreadsheet but not able to see the figure...maybe the cell too small anyhow can able to make it bigger or send me the revised copy