I was reading an earlier posting about the pros and cons of paying a car loan off early and I just thought I would mention that if you are interested in buying a new car, now is a good time to do so because the interest rates are at 0. I bought my car three years ago with a no interest loan from the dealer and have been really glad that I did. I don't pay the loan off early because there is no savings but I save a bundle by only paying for the price of the car not the interest. I bought my car in September which I think is when the dealers are more apt to give you a deal like this. Hubby still chuckles at this one to this day. I had decided that I didn't want to spend more than $12K for a new car. I found a new (1998) Ford Escort when the 1999 ones were already on the lot. The dealer had a lot of left over 1998s and was eager to sell. The sticker price on the car was $14,275 but I went in and told the salesman I did not want to pay any more than $12K for the car and I didn't want to pay any interest on the loan. I sent the salesman in to see the sales manager three times because he kept coming back with alternative offers. I held my ground and told him I would go elsewhere because those terms were the only ones I would accept. When he finally convinced the sales manager, even he admitted he couldn't believe I got that deal. Hubby kept telling the salesman it was my car and my deal and it wouldn't do any good to appeal to him to convince me otherwise. (He just sat back and grinned the whole time). I have really been pleased that I got that deal.

-- Colleen (pyramidgreatdanes@erols.com), October 28, 2001

Answers

Always keep in mindy when buying the BUYER always sets the price of an item. I have walked away from deals because the price was $1/month more. I had informed them up front of the price I was going to pay and told them not a dollar more.

-- Gary (gws@redbird.net), October 28, 2001.

Collen, I think you would have been better off buying a year old Escort with 10 - 12,000 miles on it and save about $6,000 dollars and still have the remainder of the Manufactors warrenty.

Just my oppinion. Good Luck!

-- Mark in N.C. Fla. (deadgoatman@webtv.net), October 28, 2001.

That would be a good deal for some but if you read the fine print in the ads you need excellent credit, 25% down and a maximum length of 36 months to pay it off. This is not possible for a lot of buyers.

-- Nancy Woodward (NAWoodward@lakewebs.net), October 28, 2001.

My understanding is most dealers are happy if the sales department breaks even. It's in the service department where they make their money.

-- Ken S. in WC TN (scharabo@aol.com), October 29, 2001.

Ken, since you brought it up (and it's true), a mechanic friend just the other day mentioned that people who buy new cars are going to be in shock when repairs are made (afer warrranty). They will be VERY costly, and things that the "home mechanic" will not be able to repair. I'm definitely keeping my 12-year old econobox. It's terrific!

-- Sandy Davis (smd2@netzero.net), October 29, 2001.

There's also the consideration that with the economy tanking, this may not be a good time to be buying a new car, with payments, even if there is zero interest! The down payment on most new cars would purchase a decent used one for cash. Then you could put into a savings account the money you would've been paying out in car payments. Or, better yet, use the "car payments" to pay off your other bills early.

-- Kathleen Sanderson (stonycft@worldpath.net), October 29, 2001.

Hey Mark, let me know where the dealers are that will sell you a one year old car for 50% of it's original price because I would like to go buy some so I can sell them as used cars. I know new cars depreciate but they don't depreciate that quickly. That may be what some dealer wants to offer you for it if you are trying to sell/trade them your one year old car but I guarantee they won't sell you one at that type of discount. You also have to wonder why someone would get rid of a car after one year with that low mileage unless it was a lemon to begin with. I also wanted to mention that I also didn't follow all of the warranty requirements that they layed out for my new car because at the 30,000 mile point, they had me scheduled for about four hundred dollars worth of warranty work. (The earlier warranty things were much less expensive ($30) and I had them done. They were mostly oil changes.) When I asked them what it was all for, there was a long list of things they said I had to have or the warranty wouldn't be honored. I said no thanks. My warranty is only good for a little bit longer than that anyway (36,000 miles) and I wasn't about to put that much money into a car that wasn't having problems. So you do have to watch out for what they want to do in the service department. I agree with the comment that you do have to have a good credit rating to qualify for good deals but I only had to put $250 down as a downpayment when I did it so the 25% isn't a hard and fast rule. (I had no trade-in as I had donated my mini-van to a charitable organization). Also, I plan to keep this car for at least ten years and hopefully longer than that so to me it was worth buying new, under warranty, to take care of any problems it might have had without expense to me rather than buying someone else's headaches and then keep it going forever. We have done that with our fifteen passenger van and we are very happy with it. It has had only minor problems and we have now had it for eight years. At least we know what kind of care it has had from the beginning and the fact that his has not been in an accident or flood, etc. I bought my mini-van as a used car and it promptly blew an engine in the first year. That cost me $3,000 to replace on top of the original price of the van. I swore I would never buy a used car again. I don't mind driving an old out-dated car but I want to be absolutlely sure what its history is so I plan to buy all of mine new and drive them until there is nothing left but the seat. LOL I would make an exception if I knew the people I was buying the used car from and was absolutely certain that it did not have problems or a bad history.

-- Colleen (pyramidgreatdanes@erols.com), October 29, 2001.

We have had good luck buying used from private parties--cheaper than a dealer would sell the car for, too. As long as they have the service records from the dealer, you should be fine. I wouldn't accept any records from "fly by night motors" or "fly by night oil change" outfits.

Depending on what a person wants, sometimes you might as well buy new. We found that at least with Hondas, this was definitely the case (less than $3000 diff between new and something 3-4 years old--they have great resale value), especially if you are shopping at the dealer for used cars. Although, buying used from the dealer, they will continue the extended warranty on their own brand. If the private seller has an extended warranty make sure that it is transferable and that you get all appropriate paperwork on it.

-- GT (nospam@nospam.com), October 29, 2001.