Can some expert tell me when is my break even year

[Slayer]

All consumer should be aware of the pitfal in borrowing $$.

 

But thanks to more car owners, the car forum flourished.

[Nazaki]

not many can afford to go by the "old" rule. :)

[Nazaki]

Suddenly this thread makes me worry about changing my car..

 

 

I think I better save to ard 20k at least before I start to get it.

[Donut]

you can wait until the 6th year, then try to sell off yr car, call up yr bank and ask what's the outstanding loan and how much u need to top up lor.... then you will know the answer liao.

 

no point asking now, because its all guesswork now. But from wat we see from yr figures, its gonna to be at least in 7th year breakeven year.

 

to get the accurate amt, u got to wait until 6th year and start calling yr bank to ask for the outstanding loan, and check your car body value.

[Brizzy]

think for 10 yrs loan u break even only in the 7th to 8th yr. also its better to request (ask for a letter) from the bank financing ur loan how much is the actual outstanding balance to settle coz it may actually differ from our calculation due to interest etc

[Chrispie]

  Quote

agree..that's why i dumped $27K downpayment for my Honda Integra in 2005. But i still took 10yr loan for the remaining $60K

 

At least i'm paying an affordable $646 per mth..

 

U conviniently forgot that your 27k "deposit" has now evaporated huh? .

 

Well at least u pay upfront is a bit better cos less interest imposed.

 

At the end of the day all this loans are like a noose around our necks. If anything happens and we cant service, we pray we have enough $ by selling off the car & hoping we have enuff cash to top up. Otherwise Cap 11 time.

 

The key that when we put a huge downpayment is that we spend money that we already have. And in case we need to sell, we dont have to come up with cash that we may not possess even then.

 

For those that put nothing down and take full loan, they are paying with money they do not have. In case of emergency, when the car needs to go, they will be digging a grave as then they wont have the cash to pay up.

 

The difference is that number 1, we still have options. Number 2, the bank have you as the option. I wont want to be at their mercy..

 

In feb, i nearly bought an A4 with 10% down and wanna take a ten year loan.. I am so glad i didnt do it... if i did, i wouldnt be able to just walk off from my job last mth already..

Edited December 3, 2008 by Chrispie

[Monkey888]

I always remember one lecturer's statement.

The bank is yr partner and not yr friend.

If u got no need of $$$, they will offer to loan you, even with very low interest rate.

If u got need of $$$, they will not loan u.

I always remind myself not to come to that stage whereby the bank can manipulate me.

[Slayer]

Its worry to hear so many sad endings in when indulging using future $$.

 

it is so easy to spend and it take some wisdom not to dig our own grave financially.

[Zze121]

No one mention the interest they incur on the loan, it seems that everyone is paying the interest when selling the car. Maybe the best way to avoid all this is to calculate the interest that you need to pay before taking the loan. I prefer paying up more and take less loan to avoid being stuck in -value case. Cash in hand is the best ideal case but now all of us need $$ badly, so please start to use yr calculator b4 the bank suck u dry.

[Nighthawkcity]

  Quote

u top up 10k for the old car. how about the new car, how much u down and the loan u took

 

i down 40k and took a 7 yr loan for my new (2nd hand) Alfa..

 

i upgraded to a civic FD only.. wah.. u upgrade all the way to alfa leh..

haha.. but i took a 68k loan for my civic.. sigh..

[Slayer]

Exactly. It is the interest portion that blow up the debt amount.

 

okok.. think we drifted quite far from the TS's intented question.

[Axela72]

Other than the yearly depreciation rate, I still dont understand why the penalty can be so (10k to 20k?) high when selling a car at earlier stage before the break in period. If based on rule 78, the most we lost is an additonal 20% of the interest we borrowed.

 

Example we borrow 60k from the bank, the bank charge us with a total interest of 20k for 10 yr loan. If we decide to sell the car immediately, other than the standard depreciation (which also affected to ppls who don't borrow any money from bank too), we need to fork out an additonal 4k (20% of 20k).

 

If our next car has an overtrade of more than 10k, we may not need to top up any extra $$$ to change to the new car.

 

Isn't that so? Pls correct me if I am wrong.

[Vega]

  Quote

car 56k

 

one month 551

 

loan 10 years

 

 

loan 48k

 

 

bought in 06' aug ... honda jazz

 

 

agah agah ... which year most prob i can break even?

 

bro, one word of advice. if you already took up 10 years loan, just keep driving it until break even. no point topping up 10-15K to sell your current ride and end up taking another 10 years loan for your next ride. you are just snow balling your debts. in this economic climate, i dont think this is a wise thing to do.

 

cash is king now! new models are always available. the questions is can you keep up with them.

 

i used to own a Jazz and its a good car. keep the car.

[Vega]

cos depreciation is not linear. the first 3 years will lose alot.

[Chrispie]

mainly coz 1st, like what another bro said, the depreciation is not linear.. if they say depr is 7k a year, that is provided you keep the car for full period.. Dont forget you lose 50% of the PARF the moment you drive out. That is LTA to keep. And the dealer who takes in your car will not pay for the missing parf value.

 

So a lot depends on what the dealer will give for your ride, often it is a very low value..after some thinking, now i realise the reason why ppl lose a lot in the sale of a car is due to the huge sum of money LTA take away in the Parf..

 

For the overtrade, you are just compounding your loan.. that means you pay interest on your outstanding loan of your previous car which is already charged interest.. I dun tink overtrade is a good idea. Not financially wise for sure..

[Woodlandsjazz]

i agree with you jazz is a good car to won for 10 years ... many experts have testify to that ...

 

i prob will keep it until it break even unless i manage to have $$$$ , i prob will change it to my dream car ... a civic type R ... but that was a dreaming

 

but well dream do come true smtime

 

[Hiphiphoray]

Hrrrr....most car owners talk abt how much they willing to lose, seldom discuss on break even. Your loan quite high, confirm have to wait beyond 5 years.

 

FYI, my OPC Lancer cs3, bot at 40k, sold at 20k, @ age 2 yrs 6 mths nia. Redume loan had to top up 8k when i trade in.

[Hiphiphoray]

i agree with you jazz is a good car to won for 10 years ... many experts have testify to that ...

 

i prob will keep it until it break even unless i manage to have $$$$ , i prob will change it to my dream car ... a civic type R ... but that was a dreaming

 

but well dream do come true smtime

 

U can always consider a 2nd hand Civic R mah. Cost a lot less than a new one.

 

New cars doesnt appeal to me anymore. The very first day u drive out the car, its oredi a 2nd hand car liao. I see no diff btw a new & 2nd hand car. But new car, u lose hell a lot more $$$$$$, which i find it damn wastefull.