What would you do?

[ROB37LAW]

Approved through Cap One for the following:
2010 vehicle - 12.08% @ 72 months (up to 18K)
2009 vehicle - 15.20% @ 72 months (up to 18K)

OR

Local Recognized Credit Union for the following:

Any year - 16% @ 60 months (up to 15K)

Just two months post discharge. No down payment on either.

Would it be beneficial to go with the credit union and pay the higher payment?

[teacher]

No down payment? (raises eyebrow)

[ROB37LAW]

No down payment? (raises eyebrow)

I know. I was amazed too. I do plan on putting 2K down regardless.

[HHM]

16% at 60 months with $2K down is your best deal.

[teacher]

I know. I was amazed too. I do plan on putting 2K down regardless.

I meant that in a, "Don't finance a car without a down payment" way....so good job.

[Amy26]

You are also more likely to be able to refinance the loan with the credit union later on to a lower rate (and possibly lower the term at the time as well).

I have found that finding a good credit union that is bankruptcy friendly is golden post discharge.

[ROB37LAW]

You are also more likely to be able to refinance the loan with the credit union later on to a lower rate (and possibly lower the term at the time as well).

I have found that finding a good credit union that is bankruptcy friendly is golden post discharge.

Thanks for the replies. I really appreciate it.

[HHM]

As to the actual question...What would "I" do?

I would buy a car for the $2,000 cash, and not take out any loan

[JKPDX]

Check around a bit. The credit union I belong to (in Oregon) is advertising 9.99% for people who want to rebuild their credit. (I have 9.49% on my car I bought three years ago with a good credit score, so 9.99 right out of BK sounds pretty good!).

They also gave me a secured visa two weeks post discharge at 15% interest. They are holding 150 percent of the amount I wanted as a credit line from my savings account, but there is no annual fee and it converts to an unsecured card in 12 months. I look at it like a small one year CD. The guy was super helpful too. He recommended I use it once a month for a small purchase and pay it off every month so it will report as current.

[sunkinsc]

I don't get it

No down payment? (raises eyebrow)

Not everyone has the luxury of a down payment. We have reduced to 1 income from what used to be 2 and we have no choice but to get a car once we are discharged. I would like nothing better than to plunk 2k for a car but I just can't. Surrendering 2 vehicles since the redemption loans seemed uniterested in us. We also lost our jobs and spent every bit of savings we had to stay afloat until the bk and partially through it.

So please be aware that some people don't have the money to put down or the means to borrow from family members or anything else like that. Comments like this make me think some people look down on people that may have to get a vehicle without money down even though we would rather not. It is an unfortunate situation for many.

[sunydoesitbe]

This is something we may have to look at as well. I have a very small car and my husband has a gas guzzling SUV. Neither one fits our family of 5 very comfy if we all have to go somewhere and even when it's just the kids and I. We've just dealt with it and planned to keep doing so until we had saved money. However I'm pregnant with our 4th child. So we are going to have to get a van after my discharge. I can't strap a child to the roof .
The best thing I can do is make sure that it is a payment we can make even if something happens and one of us lose a job.

[Flamingo]

Not everyone has the luxury of a down payment. We have reduced to 1 income from what used to be 2 and we have no choice but to get a car once we are discharged. I would like nothing better than to plunk 2k for a car but I just can't. Surrendering 2 vehicles since the redemption loans seemed uniterested in us. We also lost our jobs and spent every bit of savings we had to stay afloat until the bk and partially through it.

So please be aware that some people don't have the money to put down or the means to borrow from family members or anything else like that. Comments like this make me think some people look down on people that may have to get a vehicle without money down even though we would rather not. It is an unfortunate situation for many.

Many people do not have downpayments but have a trade-in vehicle that helps. But you are correct, many people just cannot afford a downpayment but when funds are tight and there is no extra money, the issue is many still go for something way out of their reach and buy out of their league at that time and then get stuck again and the cycle just starts all over. It is best to try to do your homework, get a good used vehicle at the best price/financing possible and as one's financial situation gets better as time passes, trade that in and get something better.

[BobMango]

Not everyone has the luxury of a down payment. We have reduced to 1 income from what used to be 2 and we have no choice but to get a car once we are discharged. I would like nothing better than to plunk 2k for a car but I just can't. Surrendering 2 vehicles since the redemption loans seemed uniterested in us. We also lost our jobs and spent every bit of savings we had to stay afloat until the bk and partially through it.

So please be aware that some people don't have the money to put down or the means to borrow from family members or anything else like that. Comments like this make me think some people look down on people that may have to get a vehicle without money down even though we would rather not. It is an unfortunate situation for many.

I can certainly see your side of this and everyone is in a different situation. I just can't see taking on $15K to $18K of debt for a depreciating asset. Look for a decent $4K-$5K car and borrow for that if you have to. Some people rationalize car payments by saying "the repairs will cost more than the payments", or "you can't find a decent car for $4K". That's all bull. Do your homework and buy the least expensive vehicle you can. You don't need a $15K vehicle, especially with the used car market being what it is today.

Last spring I bought my wife a 2001 Jetta for $5K. Thing runs like a champ and the only repair I made was to the remote mirror switch. This spring my daughter bought a 1999 Ford Ranger for $1,800. A few dings and scratches but really looks good and runs great.

Some people can't get over the "embarrassment" of driving an older car. For them I guess the car payments are just a vanity tax. Me? I don't care. I drove an 87 Nissan until it returned to it's base elements. I paid $1,500 for the car in '95 and drove it as my primary vehicle for 15 years. A few oil changes and brakes every so often and I figure my total cost to own was less than about $500 a year, including fuel, insurance and registration.

Do what you want but the best advice you will get here is to avoid taking on any debt for a vehicle if you can avoid it. Whether you pay 12% or 16% over 60 or 72 months? It really doesn't make as big a difference as any financed vehicle vs. any paid for vehicle. Good luck!

[HHM]

I concur with Bob...we rationalize (or a better term irrationalize) car purchases. I often catch myself with car envy. There are some great newer cars that have come out. But I drive a 2002. I bought when it was 4 years old (in 2006). So it is an 8 year old car and still has less than 70K miles. And it is paid for. Aside from new front brakes and tires (which was expected), I haven't had to do anything except regular maintenance. Pretty much any car made after 2000 could last you 20 years with very few issues.

I recently sold my wifes car, a great little 2003. The person who bought was just coming out of divorce, had no real money, she paid $4,800 cash and got herself a great car that met here needs and will last her.

[teacher]

Not everyone has the luxury of a down payment. We have reduced to 1 income from what used to be 2 and we have no choice but to get a car once we are discharged. I would like nothing better than to plunk 2k for a car but I just can't. Surrendering 2 vehicles since the redemption loans seemed uniterested in us. We also lost our jobs and spent every bit of savings we had to stay afloat until the bk and partially through it.

So please be aware that some people don't have the money to put down or the means to borrow from family members or anything else like that. Comments like this make me think some people look down on people that may have to get a vehicle without money down even though we would rather not. It is an unfortunate situation for many.

A down payment on a car at that price isn't a luxury, it is a smart decision.

I am aware of what some people do, although I think it is a poor personal choice for their future. I have no control over what my comments make you think. My intention was very clear. Purchasing a car like that isn't a smart choice for the future. That's like justifying to me why payday loans are a good idea.