Would you take out an 8 year car loan for a car you cannot afford?

[1MEAN18]

Title says it all, please vote in the poll.

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[FruityJudy]

Whats the definition of afford it in this scenario? Being able to buy it outright at any moment via cash? Being able to pay the payments in full on time?

 

[1MEAN18]

Whats the definition of afford it in this scenario? Being able to buy it outright at any moment via cash? Being able to pay the payments in full on time?

affordability is of course a bit subjective. General rule of thumb is...is the car payment 10% or less than your gross income? If so, then its "affordable". This is why 6, 7 and even 8 year car loans are becoming more common. People are buying cars they cannot afford in any other way, other than to push out the loan term to a crazy long time, while paying thousands more over the life of the loan (notice I didn't say life of the car) than they otherwise would.

 

[Bikeman315]

Ford gave me free money for 6 years. I bought my GT/CS back in March and took the 0%/72 month. Could I have just paid cash? Yes, but after crunching the numbers I’m coming out way ahead. My investments will return more than any additional savings I could have gotten on the car (I also got a really good deal). Also since there is no interest I can pay off the car anytime I want.

 

[1MEAN18]

Ford gave me free money for 6 years. I bought my GT/CS back in March and took the 0%/72 month. Could I have just paid cash? Yes, but after crunching the numbers I’m coming out way ahead. My investments will return more than any additional savings I could have gotten on the car (I also got a really good deal). Also since there is no interest I can pay off the car anytime I want.

I would say that's savvy. Wouldn't put you in the long term loan category for a car you cannot afford. Sounds like something similar I do by using credit card for all my living expenses, then pay it off at the end of each month then apply the cash back 1.5% bonus to one of the monthly bills as a credit right before I pay it off for the month. I usually end up with somewhere around 20 free bucks a month that will and I never pay a finance or card fee ever.

 

[Hack]

I only buy cars using the funds I have set aside for enjoyment, but I would spend most of my fun money on a car. There's the money set aside for retirement/savings/normal expenses, and then there's what is left. I don't try to pinch pennies too hard or think too much about how I spend my fun money. I just have fun with it.

I voted I would buy a car I cannot afford. That said, I've never had a car payment of 10% or more of my gross income. I've come close though. With my lifestyle, I think that spending 10% of my gross income on a car payment would be fairly comfortable for me. I don't have a big house payment and I don't spend a lot of money on non-car related things. I probably wouldn't have much trouble with 15% if the right car came along and I felt I really had to have it.

Cars are a higher priority to me than just about anything else in my life that I spend money on. Having said that, I have cheap cars right now. They are fun though, and part of my wild and crazy spending on cars is switching cars often to see what different vehicles are like.

 

[w3rkn]

Title says it all, please vote in the poll.

I am not understanding your question.
It seems, if you are asking about leasing instead of buying..?

 

[1MEAN18]

I am not understanding your question.
It seems, if you are asking about leasing instead of buying..?

leasing or buying, wouldn't change my question. a car loan past 10% of gross income is no longer considered affordable whether its a lease or not. Lease would probably be even worse actually, if you think of it...a lease you almost always end up writing a check up front for thousands of dollars to cover the instant depreciation of the vehicle you leased...and common sense would say anyone seeking an 8 year loan on a car they really cannot otherwise afford probably doesn't have the several grand out of pocket to even initiate the leasing terms.

 

[Nagare]

If it got me a C8 right now I certainly would lol, but still not in my budget at that point anyway.

 

[2morrow]

NO but what is the point of this thread,? To just out poor financial decision makers?

 

[1MEAN18]

NO but what is the point of this thread,? To just out poor financial decision makers?

The nature of the thread is to spark conversation and in some cases maybe even educational. It's also a question that I've never seen asked or talked about here on the forum, so I'm most curious about how the poll results shake out.

 

[Amaury]

Only way I would do this is for a Viper. My limit is around 75k and those cars here are around 110k used...

 

[2morrow]

The nature of the thread is to spark conversation and in some cases maybe even educational. It's also a question that I've never seen asked or talked about here on the forum, so I'm most curious about how the poll results shake out.

Understood. Hopefully people are being truthful so that the data gathered is accurate.

Im sure if you go to the Facebook pages you'll get a lot of the folks in the first column as it tends to have a greater population of younger members and therefore people with less earning potential.
I've also noticed the amount of threads involving "The Poors" and the comments associated with the aforementioned statement leads me to believe that there are a lot of folks that have made
potentially poor financial decisions with their car(s).

It seems (and I could be wrong) that the forums are generally for a different kind of person and your audience will probably skew the data that you are trying to gather.

Good luck OP

 

[1MEAN18]

Understood. Hopefully people are being truthful so that the data gathered is accurate.

Im sure if you go to the Facebook pages you'll get a lot of the folks in the first column as it tends to have a greater population of younger members and therefore people with less earning potential.
I've also noticed the amount of threads involving "The Poors" and the comments associated with the aforementioned statement leads me to believe that there are a lot of folks that have made
potentially poor financial decisions with their car(s).

It seems (and I could be wrong) that the forums are generally for a different kind of person and your audience will probably skew the data that you are trying to gather.

Good luck OP

Yeah I don't disagree with the Facebook remark...I'm sure its skewed, but I deactivated my account a year ago, the only time I know something Facebook based is if/when my girlfriend hands me her phone and shows me something she likes. This issue in particular is interesting to me because its the opposite of how I view finances and buying things. And until recently, I never knew an 8 year car loan even existed. The forum does generally seem to be a bit of a skewed audience of buyers, but since I'm not a part of all audiences of buyer, but I am this one, I ask my curiosity question here and take what I see with a grain of salt. This buying over your head thing definitely isn't a new trend, but financing companies and auto makers being partly to blame because they enable it seems to be a more modern issue though. And the ethics of it all is also pretty sketchy if ya ask me, but a buyer's market is also what we have today, so a fool and his money shall soon part I guess.

 

[Blue Moon]

My last car, I had a two year plan and paid it off in a year and a half. My Mustang had a three-year plan and I paid it off in six months. Eight years is just inconceivable to me.

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