Ok guys,

Background
Just to give you a background on what I have coming in my life over the next few years to help aid you assisting me. I am almost 25 and have been working as a bridge engineering for almost two years. I still live at home with the parents in order to try and save money and pay off my student loans which are around $20k now. I have a girlfriend that I am very serious with and plan to propose probably within the year so I need to save for a ring and a house. I have a 2006 TSX with 12,3XX miles on it in which I only owe about $3700 left on it. I have been driving it to the train station and back every day for the past year totaling like 6.5 miles a day. I am now switching from bridge design to construction management in which I have been assigned a job that is 53 miles away from my house driving up the New Jersey Turnpike. This is going to KILL my car!! I am now trying to decided what to do and whether I should suck it up and use my TSX, or buy a second beater car like a civic, accord, maxima or such to commute in or maybe even a small truck. I have always wanted a weekend warrior type car like a LS1 camaro or a Honda s2000 or something like…..keep that in mind.

Question
So, I guess I’m just asking for some advice from guys that may have been in this position before or maybe just provide some insight to things that I may not have thought about. Again, I have student loans that have 4.5% locked in at about $150 a month (not bad), I need to save for a ring (around $4k give or take), a house (I have about $10k saved so far but about $15k in other areas I can use if necessary), and that is about it. I have no credit card debit at all, or anything else.

Options I have come up with so far are:
1-suck it up and use the TSX and save some money and get a weekend car in a few years
2-buy a beater car for like $7-$8k and put down $2-$3k and finance $5k or less just to span it out. If I do this, I need help with some reliable cars.
3-Sell the TSX and get two slightly newer used cars one for commuting and one for everything else. (not liking this one, probably cost me more money in the long run)
4-Do they have high mileage leases?....this would be perfect but I don’t think they do…..

Cars I have considered so far:
94-2002 accords and civics
97-2002 maximas
94-1997 integras (hard to find unmodified though)
97ish Toyota Tacoma
94-2002 Toyota camry/solara

Any advice or recommendations you can provide would be greatly beneficial to me. I appreciate your feedback guys!


Jordan


EDIT: Mods, if you think there is somewhere else this should go, feel free to move it but i figured it was mostly car related.....

 

Daily driving a "beater" sounds like a great idea - but it usually sucks. Especially coming from a car like the TSX.

After you get engaged there will be an endless stream of expenses, you need to be prepared for that. Additionally, is having a second car THAT important to you? There isnt only the cost of the car but insurance and additional wear and tear. An old camaro would be a heck of a lot cheaper, so Id lean more towards getting something like that.

Anywho. Id:

1) Keep the TSX and pay it off asap.
2) Save, save, save. Use the "car payment" money you will soon have and save that as well.

Dont worry about the student loans. Its at a decent rate and the monthly payment isnt bad.

Youre in good shape - just be patient and spend your money the way YOU want.

 

Thanks Saki!

I thought about the insurance and i made an older car my daily driver and the TSX a "second car" would it really go up that much? I mean i knew it would go up, but i wouldn't think that much. I'm afraid to even call and ask and they might flag my account. I have AAA by the way and they have been great so far in the one accident i had when i was hit by a girl who ran a red light (older 04 TSX that was traded for my 06).

I know driving a "beater" would suck but i feel like it would save me from ruin my still pretty new TSX.....

I do want to try and pay off the TSX in the next few months too!

 

Option 1. Keep the TSX and drive it until the wheels fall off...let it become your "beater." Pay off the student loans ASAP. Get a weekend car down the road. A house and a paid for car are the two best things you can have.

 

+1 for keeping the TSX, pay it off asap, and continue to save.

you're 24 and you've already got $10k (plus another $15k) saved up. that's very good. i wish i had that kind of money saved up when i was your age.

like saki said, don't worry too much about the student loans. it's much better than, say, being in credit card debt.

you're in good shape.

 

No brainer, keep the TSX...You're only $3700 away from no payments! Get that second car AFTER you get married and or get your house. I drove a 98 Tacoma and my wife drove a Saturn for 6 years before we got our house, but we had about 2 years with no payments on them. Makes a huge difference.

 

Your TSX in 3-4 years is going to be just another older model car. Soon the average buyer will tire of it and flood the market with used clean examples such as yours, and resale will just be "normal."

I say, drive it and enjoy it.

Call your insurance with a VIN from autotrader. They wont flag your account, just say you want to know how much it would be. I do this all the time.

I pay $65 for my 03 PT Turbo...adding a POS 1998 automatic Sentra and switching the cars (PT = weekend car and POS as daily) DOUBLED my monthly bill. Retarded, but possible.

 

If your insurance gives you a multi-car discount, then no. It would go up very little. That being said, I'm going to give the same advice as above: Keep and drive the TSX and forget buying anything else. If you sell it and buy two other cars, you take the hit on depreciation and end up with two crap boxes. Buying a beater is more expensive than it sounds, you will still have to insure, pay registration, and upkeep on that car.

With all the expenses you have coming up, another car (beater) would just be a burden.....and I guarantee several months down the road you'll end up staring at the TSX that you never drive and wonder why you have two cars.

Just my

Best,
-Mirror

 

Thanks guys! My girlfriend just bought a 07 scion TC and owes about $12.8k on it which she is really trying hard to pay off. She never went to college so she doesn't make a ton of money but its certainly more than nothing. I know that once we get a house we'll be fine, its just that initial 20% i'm worried about. I know you get a 20/80 but i would rather not do that and have to deal with the PMI and such.

If i keep the TSX, which i am leaning towards i think, i will most likely sell my Ron Jon wheels and maybe even take off the apsec suspension to make the commute a little smoother. If i sell those it would probably cut the amount i owe on the car in half, so that would be helpful too!


EDIT: Just saw the other few response, thanks a lot for the feedback!!!! You guys are really making me lean towards just using the TSX for the commute. I think that is what my gut is telling me to do but sometimes its hard to listen to it....lol.

 

You dont pay PMI on an 80/20...I know because I did an 80/20 4 years ago Moot anyway since not many banks/brokers offer that type of loan anymore.

 

Oh....i am not all that familiar with mortgages and such. I haven't even looked into what i can afford but i'm thinking my my top house/condo price would be like $225k and that may be pushing it. The problem is, in my area, the house that around that price are CRAP!! If i want something decent its like $250k and up to $300k which i cannot afford. I'll post a seperate discussion about that in the investing and money thread later on though.

 

80/10/10 and 80/15/5 also avoid PMI. The second will be at a slightly higher rate (still deductible) and most likely have a balloon payment at 15 years, but what are the chances you'll be in that same house 15 years from now? Just FYI.

EDIT: Just read your last post...this might be a bit too much info for you at this point. Still, good to know.

 

Why are you concerned your new position will "kill" your TSX? Is it the mileage or having it exposed to a construction site? Either way, I would agree with others here and keep using the TSX. With the current mileage, it's still a relatively new car. And most importantly, you have already paid the depreciation on it. Now its time to get some use out of it, especially since you are so close to having it paid for.

Pay off the car, save your money, and put you yourself in a situation that will allow to take advantage of opportunities that will undoubtedly arise as you get older.

Terry

 

Oh yeah, one more thing against buying another car. With an impending marriage and house purchase, save your "more cars than we need" coupon for when you really need it down the road. Trust me.

 

Just out of curiosity, could you just take out the 3700 you owe on the tsx from your savings and pay that off?? Then start saving up since you wont have any more payments???

 

I'm trying to resist the urge for that reason....its hard because right now it is obtainable but not the best decision. Thanks for the reminder though

 

I wanted to get a $10k savings "cushion" if you will. Now that i have that, i am starting to save to pay off my car and buy a ring. Those are goals for this year and i think both can be obtained by the fall...assuming my spending doesn't go crazy. I am not planning on financing a ring either so i want to pay cash. I have that $10k in an ING account so it earns a little more but still is easily accessable for now.

 

Clear bra the TSX and run it! The main thing highway driving does to a car other than rack up miles is sand blasting the paint, it isn't like the turnpike is littered with whoops and potholes like the lower deck of the GW bridge. The other options don't make solid finacial sense. The fifth option would make the most finacial sense but the hardest to swallow in car terms:

#5 Sell the TSX and get a beater (with no second car) and use the 12-13K you are ahead toward a house.

Again, hard to swallow and I would not have done it at your age BUT I will bet you 10 years from now you will be very glad you did it!

 

One other thought: you know your TSX, but would have no idea of the weak spots of any beater that you might get. I'd hate to be stopped on the road somewhere after giving up a nice, comfy car for some beater with an unknown repair history.

SakiGT is right- a car is a depreciating asset and not an investment, so the TSX will lose value/money over time whether you drive it or not. You might as well drive and enjoy it. The TSX should be good for 150,000+ miles with just regular maintenance, too, so I'd drive it smiling as far as it will go.

G/L, but it sounds like you're thinking and making the right decisions anyway!

 

My buddy has a 99 Civic he uses as his commuter and a S60R as his "business time" car ... But get this, the Civic is stick and the Volvo is Auto.

What a moof.

 

no one is doing those programs anymore.....

the only things left are 80/20's and even at that, their hard to come buy and pretty strict on guidlines but u have to do them as a combo to get a decent rate....if not and your trying to do two loans from separate places.....it's not that easy, no one wants to do 100% financing. and 80/10 can be done, but still those are limited. i deal with it all day long.....

pay the tsx off, save the cash, put down 10-20% down on the house and get financing, keep the debt off and in the meantime build your credit, you will need it

 

80/20 and 80/10/10 are hard to come by? Then what are people doing, paying cash? I have two loans from two separate places, one with a great rate and one with a reasonable rate...it wasn't that hard to get. I'm sure I could get it again if I wanted. And I can guarantee you if I walk in with 20% down, I will walk out with a loan for the rest at the lowest rate possible very easily.

100% financing is stupid, in my opinion; I wouldn't do it as a buyer and I wouldn't offer it as a broker.

 

80/20 means 100% financing. Usually its an ARM for the 80% part and a home equity for the 20%. It was just a way they played with numbers back then. I dont know if they still do it...doubt it...

 

I meant 20% down with 80/20...sorry if that caused any confusion. I don't think they do what you just described any more...too many people who should've never bought houses got one that way and (duh) defaulted.

 

Don't worry MANY people confuse the 80/20.

Although many people used 80/20s, interest only and other creative finacing to buy houses most were not people who should not have bought a house, just should not have bought a Mc Mansion. It looked SOOO good, buy a house pay an interest only loan with no money down, watch the value sky rocket and sell for a mongo profit just before the loan shifts to full principal payments. Oops the bubble burst, can't sell and even come close to even AND the your old builder are selling new homes in YOUR neighborhood for less for $100 less per square then you paid.

 

No financing companies have the balls to do 80/20 in today's market.

Many smart investors bought their homes 5 years ago for dirt cheap (before the insane increase in housing prices in CA) and financed 100% of the house using the 80/20 method. After two years, the value of the house literally doubled (and then some) and they made off with the equity by selling it. I am talking about buying a house for $250k and selling it for $500k to $550k. This was a common real estate practice seen in the inland empire. Houses were selling so fast 3 years ago. Now all we see are foreclosure signs on every other house

My point is, not all people are dumb and got their asses defaulted on the mortgage. There were quite a few smart real estate investors couple years ago that made off with shit load of money by taking advantage of the exponentially growing housing market.

 

i'd pay off the TSX and keep it and rock it for awhile.

I was thinking about selling my beater. but it's so high mileage i'd get next to nothing for it.
with this new job they(the farmer's co-op) gonna give me a F-250 4 door powerstroke FX-4 to use. I got a 94 Accord with 310,000 I was gonna get rid of now. I drive it maybe 10k a year AT THE MOST. then I got my 2000 Odyssey. then my g/f told me once we get married(down the road) she said (since she's a nurse she's making good money) she'll buy me any car or truck 40 k or less. or i can put 40 k toward a ride.
only thing is gotta be a 4 door.
she's either getting a new Pilot or Accord.
as long i'm still getting the F-250 or something like that (Dodge or GM counterpart)
still free. I'm probably gonna save my nickles,dimes, and 10 dollar bills to get a Jaguar XFR

 

with 20% down ur looking at 80% financing. when i see 80/20, 80/10 it means 800% first mortgage 2nd fixed or heloc. now 80/10's are possibly for 90% financing but not so easy.

with 80% down and decent fico and very little debt you can get a good rate. but now rates are also adjusted by fico score no matter what automated underwriting says. if you got a 680+ credit score, some money in the bank 6months PITI, little debt and good income. you can get a great rate at 80% loan to value.

i got my own wholesale line with many programs....i also got 80 other lenders to can broker through. some do some dirty stuff but the rate isn't that good, but desperate people will take it for the cash.

my suggestion to the OP, is pay off the car. take care of the car and it will last you for a while, just keep up with maintenance. save more money, and hopefully it will turn into a buyers market. haven't had my car for more then a year and i got 20k on it right now, but i take of it....it's like new.

 

Thanks for all the input guys! I think i'm going to just keep the car and sell the wheels and put that towards paying off the car. Its just going to stink seeing like 30-35k miles rack up on the car so fast but i guess i'll live.

If any of you guys need a set of chrome 18" Ron Jon Servo's that are in mint condition, let me know

As for the all the mortgage info, i will def be posting another thread about that since you guys seem to know your stuff about that too. I have to say AZ is a pretty cool community of guys, props to you!!

 

Posted this in the TSX section as well but figured i would throw it in here to since different guys replied and gave good advice.....

So i just talked to a field guy who came into the office that works up at the new job site i will be working at soon and this is what he had to say....

He bought a Ford Explorer in 2003 with 22k miles on it and he just hit 217,000 miles on it this past week. That is like 43k miles a year. He then said that the job trailer is back underneath the NJ Turnpike and is on dirt and you have to take a dirt/gravel road to get back to it and his truck has mud and dirt on it 24/7. He also said he gets between 18-20 MPG and fills up $35-$40 in gas every other day

He recommended me getting a truck if i could to keep my car nice but i have no idea what to do. My TSX will get destroyed doing this everday. I still need to buy a ring within the year and house shortly after that but i really don't want to ruin my car.

Do you guys have any other suggestions as to what i could do? I'm thinking i should get a truck but gas mileage won't be good....i am lost at this point.


More Importantly.....
Also, my g/f is like ready to get married of like 2 months ago and would be perfectly fine just getting married and living in an apartment with me until we saved enough money to get a place. However, i mentioned i only have about $10k saved and if i have to buy a truck, a ring, a honeymoon, and some wedding things, that money will be GONE!! Then we're married with no savings and no money to really put towards a place. I rather just wait like one year to a year and half to save more money so that we don't have to throw $800-$900 a month away on rent for a long period of time. If we need to rent for like 6 months i'm ok with that but i'd rather not.

I am trying to reason with her but all she seems to care about is being with me and we'll figure everything else out. However, i feel the responsibility to provide for her and with a salary of only about $54k a year (she makes about half that) we aren't in a great position, but we're not in a horrible one either. She just doesn't seem to understand that i don't want to start off with our foot in the grave when we have the our whole lives to live pay check to pay check (i'm never going to make that much money in my engineering profession). She is only 21 so maybe she is just being a little immature about this due to lack of experience but she has her stuff together all in all....

Sorry for the additional info but you guys have provided some nice insight and figured it couldn't hurt throwing this out there as well.



Regards to the truck, if i end up needing one, i was looking at Tacomas, Dakotas, and Rangers all with either the I-4's or V-6 to help with better gas mileages....comments on those?

 

What does the girlfriend, soon to be wife drive? Any chance on selling her car and letting her use the tsx, then buying a truck?

Contrary to popular belief, you can do whatever the hell you want to do. You dont have to buy a house as soon as you get married. Dont stress yourself out.

If you want to marry the girl, do it. Dont let the $ be in the way. Shes right - things just fall into place.

And most trucks, even the four bangers get crap mileage (relative to their car counterparts). Id explore the option of a wagon as well.

 

Well, you only owe a few thousand on the TSX correct? I would sell it, pay off the rest of the loan and use the rest to buy the truck. Get one cheap enough and you might even have some money left over.

As for your wedding, make sure you family knows now of your desire to buy a house after you get married. My wife and I did this and we pretty much only received money from most of our guest, which is exactly what we wanted.

I think I mentioned earlier that I had a Tacoma for about 6 years. Never had a problem and the 4 banger had decent power and mileage.

 

Girlfriend just bought a 07 Scion TC actually. She has 8800 miles on it and owes about $12,900 on it.

What wagons might you be referring too? I thought about something like a Rav4 or CRV too, but like a subaru wagon or something?

I just wanted to get a little more cushion under me. I have $10k but if i have to buy a truck and a ring, its gone!

 

Yea, i owe about $3700 on the TSX which is why i didn't think it would be a good idea to sell it actualy, although i thought about it. I actually thought about selling it and buying two cars, a truck out right and putting the rest down on something like 1-2 years old and having a slightly higher payment but nothing i couldn't handle.

Good to know about the Tacoma though!!

 

Its an 06 with 22k miles right? you could easily get 20K for it. Pay off the $3700, get an 04-05 Tacoma for 10-13K...Its a win-win-win. You're not going to be trashing a good car, which will be worth a lot less if you do, You won't have a car payment, and you'll still have some cash left over...Seems like a no brainer to me

Why the heck would you want to buy 2 cars?? You're planning on getting married, you want to own a house, now isnt the time to be buying multiple cars. Right now all you need is transportation. When you're able to park your new cars in your own garage, you'll understand then...

 

Id rather sell the tc than the tsx.

What does the girlfriend have to say about all this?

 

Besides not ruining the tsx, not sure why you need the truck. You can light offroad in anything, really.

Replace tsx with this:

http://philadelphia.craigslist.org/car/586094712.html

 

It actually only has 12,400 miles on it!! I figured i could get more than $20k for it if i sold it privately. I wouldn't actually buy two cars for that exact reason, i was just talking out loud i guess. I guess something just doesn't feel right to sell a car in order to buy another car with lower mileage on it.....

However, Saki, you bring up a good point about maybe selling her Tc and letting her use my car for the mean time.....

Girlfriend honestly don't care what i do, i think all she wants to do is get married to she can be with me and everything else will just "work itself out." She thinks getting a beater truck would be an ok idea if the job site is that bad. I am still planning on taking my car up there when i start in about 2 weeks to evaluate it first and go from there. We have actually been disagreeing with a timeline as to when it should all go down. She doesn't understand why i feel the need to wait a little bit to get a little more money saved at all, she just can't see it cause we CAN afford an apartment.

That jetta has like 113k on though....not sure how i feel about that one!

 

Why dont you drive the Scion?

 

Id use the TSX until it dies. You will soon own it, why go switching vehicles. I would advise against a truck unless you NEED it for work. The mileage and gas money will eat you alive. If you do need one get a Toyota. The scion is hers, she wanted it so I'd let her pay it off.


She doesn't understand waiting because she is only seeing it from her point of view. Also you mentioned that your income is much greater than hers so you are the one that will probably end up fitting more of the costs. Of course she wants a place...

Staying at home you are saving a lot more money than if you were on your own and married which is probably gonna set you back more than $5000 when all is said and done but good luck telling her that. In just 6 months you could probably easily save a few more thousand and that would go a long way. Buying a house isn't just the mortgage + closing costs, there is a lot more involved.