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Discussion Starter #1 (Edited)
Hi,

Long time since I posted on here. Please move this post if it's in the wrong category.

I am trying to get a $25k (taxes included) car with $0-$5k down (I *can* put up to 5k down but I would *prefer* to put as little down as possible and invest it instead).
I have bad credit (only have a secured CC from one of the big five right now) due to past foolishness. Youth.
I have a relatively high income (6k/mo AFTER taxes).
I tried getting a $25k car using the finance specialist at the dealership. Unfortunately they were unable to secure a loan for me (bad credit).
The loan terms were to be something like 60 months, $400/mo, 5% interest.
My total monthly expenses are about $1500/mo right now.

As you can see, I am in a rather peculiar position- bad credit, high income.
I am ok with a high interest rate (no more than 15% I hope...!) because I plan to pay down the car within the first 24 months. I have some investments I want to tend to right now and thus don't want to have to save to buy the car in cash ~6months later.

Any advice? Help? Recommendations? Referrals? Any car loan brokers on here?

I am in Toronto area.

Thanks!
 

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Consider whether this is really the best thing to do or whether past foolishness is rearing its head again.
You must know that you shouldn't be taking on 'bad' debt, especially when you have cash and/or can save and pay for it entirely in the next year.
Instant gratification/entitlement/'I want it all' - whatever you want to call it, is what gets people in trouble financially.
 

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Discussion Starter #3
Consider whether this is really the best thing to do or whether past foolishness is rearing its head again.
You must know that you shouldn't be taking on 'bad' debt, especially when you have cash and/or can save and pay for it entirely in the next year.
Instant gratification/entitlement/'I want it all' - whatever you want to call it, is what gets people in trouble financially.
Ah, I get what you mean but this is not the position I am in. I don't want to divulge too many details but for whatever reason, this car is almost a necessity for me (it's just a used Japanese car).
Forgive me for the vagueness but ... hope someone has some ideas for how I can acquire a (relatively) cheap loan?
 

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The truth is that for any car you can finance through a bad credit lender.............you might as well buy with your $5000 in cash.

These lenders will sell you a car for $5,000 that they paid $1,000 to buy at an auction.

They will require a $1,000 down payment and $500 in "administration fees". They will charge another $500 for "GPS unit" installation to track the vehicle.

They may require a warranty purchase which will be added to the cost of the loan.

Before you leave the lot the dealership already has their money back for the car and you owe them $15,000 for a $5000 loan.

It is a great deal...................for them.
 

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Do you need a 25k car? If you have high income, why not just 1) buy a cheaper car, pay no interest, and invest the rest or 2) save a few more months and then just buy the 25k car in cash?

Cars are depreciating assets, that cost money to maintain. So it's a money pit double whammy, not only is the "asset" worth less with time but you actively have to spend money to keep the "asset" that is depreciating. Interest expense only makes this worse.

If you want to invest your money (implying the accumulation of appreciating assets) the less money you spend on a car, and the less interest you spend on a car, the better.
 

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Discussion Starter #7
Consider whether this is really the best thing to do or whether past foolishness is rearing its head again.
You must know that you shouldn't be taking on 'bad' debt, especially when you have cash and/or can save and pay for it entirely in the next year.
Instant gratification/entitlement/'I want it all' - whatever you want to call it, is what gets people in trouble financially.

The truth is that for any car you can finance through a bad credit lender.............you might as well buy with your $5000 in cash.

These lenders will sell you a car for $5,000 that they paid $1,000 to buy at an auction.

They will require a $1,000 down payment and $500 in "administration fees". They will charge another $500 for "GPS unit" installation to track the vehicle.

They may require a warranty purchase which will be added to the cost of the loan.

Before you leave the lot the dealership already has their money back for the car and you owe them $15,000 for a $5000 loan.

It is a great deal...................for them.
Do you need a 25k car? If you have high income, why not just 1) buy a cheaper car, pay no interest, and invest the rest or 2) save a few more months and then just buy the 25k car in cash?

Cars are depreciating assets, that cost money to maintain. So it's a money pit double whammy, not only is the "asset" worth less with time but you actively have to spend money to keep the "asset" that is depreciating. Interest expense only makes this worse.

If you want to invest your money (implying the accumulation of appreciating assets) the less money you spend on a car, and the less interest you spend on a car, the better.

Get the money from family or buy a cheap car until your credit improves.



Thank you all. I have come to realize that I am just being foolish/hasty. I will most likely buy cheaper car (5-10k) in cash and call it a day for now. The 25k car is safer (biggest concern of mine) but I can't live in paranoia!

I like this forum.
 

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Thank you all. I have come to realize that I am just being foolish/hasty. I will most likely buy cheaper car (5-10k) in cash and call it a day for now. The 25k car is safer (biggest concern of mine) but I can't live in paranoia!

I like this forum.
Probably a better choice. New model elentra's go for like 16k so 25k+ is so unreasonable in your situation. You can get a decent car for a lot less. Focus on building your credit back up. Cell phone bills, cable, also go towards your credit so manage your finances properly. I am curious as to what you spend your money on. 6k after tax take home pay is around 100k pre-tax.
 

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You should work on making your credit better before you head out and indebt yourself again.
Its great that you make $6k / mth but if you are not able to hold on to it, then its not all that great.

I see profiles like yourself everyday (given my line of work); Young, no savings, poor credit, new job making decent money......so time for a new car, house, TV, ATV, watch, vacation, couch, cell, wardrobe, etc., etc., etc., ALL on credit.

Learn from your past, rebuild your credit and get your finances in order before you run out to spend someone else's money. You may think you need a car but there is always an alternative.
 

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car loan

It's definitely a good idea to look into all of your options for a car. You could find the same exact car you're looking at now, in better condition from a different dealer, and at a cheaper price. It's all about research, especially if you are buying used. There is no need to spend 25k on a used car when you can get an extremely reliable used vehicle, that is still decently new, for under 10k.
 
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