Hapa DC5

Okay, this may not be a step backwards or a total trade down. My girlfriend and I are over. My apartment is being converted to a condo and my job sector is being eliminated by my employer.

I have another thread in dating and relationships that goes a bit more into detail regarding what's above so I'll leave it at that.

I have two solid fall back jobs with letters of intent, so being employed with a similar salary will not be an issue to me. I would really like to buy my apartment when it is converted to a condo. Before I do that I'd want to make sure the price is right and the whole nine. I should get rid of the TL payment to free up income so I can afford my mortgage easier.

The best thing to do financially is to get rid of the TL and buy a used car for cash with no payment. Trust me I know... Unfortunately this is a car forum and it's hard for me to think completely rationally when it comes to cars to just view them as transportation I'm sure you would all agree...

I would like to buy a new Mazdaspeed 3 w/o navi and install an after market (pay for in cash) unit that has bluetooth, ipod adapter, etc. That way it has some of the creature comforts I am use to in my TL. My ex has an MS3 and I really really like the car. I did some math, found out what my CU would approve me for on a loan and found out if I financed an MS3 my payment would be $100-220 cheaper than what I am currently at for the TL depending on how much I put down ($618 a month high payment. zero down = buried in a car).

The TL will not be paid off for another 4 years, so taking on 5 years of debt right now will not be a huge deal. Gas will not be much of a difference and insurance will be up slightly maybe $12 a month. It would be easier to afford a home and driving a more modest car while satisfying my urge to have something fun and modern.

If I take the plunge to buy the condo, this would be the last new car I buy in a long time provided it remains reliable. I would much rather make the payment on a place then a car. Do you guys think this is a good compromise if I have a job lined up and the living situation is worked out? Thanks for reading.

mrmako

A really nice car is a luxury. You need a dependable car more than a luxury car. I say put more money into the house/condo, as this is where you will spend most of your time.

And another reason: If you find another GF, and she sees you live in a crappy apartment but drive a nicer car, she'll think your priorities are all wrong.

taitando

I'm not sure if you're looking into buying anytime soon, but the real estate market is still tanking in many areas. If you happen to be an an area where the foreclosures and prices are a little more stable, then yes, I think choosing to have a home and living with a modest car is the better decision. Cars, no matter how expensive, are depreciating assets (unless you've got a classic rare collector's car ), but homes will garner equity (not to mention some tax breaks). So yeah, I think choosing to have a mortgage while driving a more modest car is the way to go. I just wouldn't buy a home immediately. At least not in my market.

enigmaos

iTrader: (4)

home > car

I agree with both of the posters above. cars depreciate no matter, and their main purpose is to take you from Point A to Point B safely that most cars can do.

Hapa DC5

I'm not planning on buying immediately more then a few things have to pan out for me, before I purchase. But I will live as if I was paying a mortgage so I can adjust to the lack of income I'll have and be essentially house poor.

The sub prime fall out isn't over yet. Even if I choose to get a more modest car and not buy a home it would be in my best interest. I could continue to save until I have a hefty down payment.

Thanks everyone for their opinions.

bmaczo6

iTrader: (1)

If you are like most people you will waste more money on cars than anything else in your life. Many people choose to spend a lot of money to drive nice cars. A young man like yourself would be much better off using your money to buy a condo/house. Good luck.

charliemike

Anyone buying a condo in CA right now is dumber than a bag of hammers unless the mortgage is ≤ rent for the same unit. And knowing California, it's gonna be years before that ever happens in formerly "hot" real estate areas.

That is unless you can afford a 2500 sq ft penthouse you can grow into. But it doesn't sound like that's the case.

Trackruner228

iTrader: (1)

Like said before the house is greater then a car. If you really want to do it the right way sell the TL and buy something like a civic or corolla and this way you can have NO car payments and would be able to free up yourself even more for your house. Whatever you do though make sure you get more for your TL then the outstanding balance on the loan, and if you cannot do that I say wait awhile before selling it.

Hapa DC5

You're absolutely right. I don't plan on purchasing immediately. Honestly it's impossible to find a house/condo or even closet remotely close to what I pay for rent in the Silicon Valley...

That said, I still like the MS3 and heard it will come out with a Pearl White in the States. I may not be able to afford a condo in the near future nor will it be the right time to buy, but a trade down will be step in the right direction.

taitando

If more "home owners" had planned as carefully as you, maybe we wouldn't be in the mess that we're in now with the sub-prime woes and foreclosures. Regardless, living frugally with a Mazda Speed 3 isn't bad, because the 3 is a helluva car. Good luck.