Ya, but the 2015 is totes affordable, right? LOL

 

One other thing, call your insurance company and see what the difference is as the insurance premiums will be higher on the new rig vs your old rig.

 

Are you planning on hauling stuff commercially or just for yourself? If commercial you'll wanna look into the DOT requirements for interstate use over 10k (aka over a F250 or downgraded F350). Depending on what your real world requirements are you can probably do with a leftover '15 gas model, but still it's not cheap. Rebates are not too much higher, but their was about a $900 price increase between 15 and 16 to consider. Also, any new trucks in stock are going to be old and the dealers likely have advertising dollars to push at it. You should be able to get 72 months easy, some banks may no longer consider it a new vehicle so 84 may be harder to get, but worth checking out. If this is a daily driver than I don't suggest even considering going farther than that. Really it's expensive, but if you're planning to make money with it then I MIGHT say it's not a horrible idea. If it's just for your own toys, an older model is smarter. I burnt myself buying more car than I should have when I was younger, would hate to see you do the same.

 

84 month payment? That's insanity.

He needs to be looking at used bicycles at best.

 

Generally I agree, for vehicles over $40k you can actually do 120 month....

If he's using it for a specific purpose and will only be putting say 5k a year on it though, thats only 35k miles after 7 years. Rates can still be reasonable at 84k and there is a valid place for such a loan. Generally I prefer to see it for retired folks who will keep it 20 years and are on a fixed income. They are low default risk and unlikely to burn out the vehicle or see major repair cost during the loan period. Based on income, yeah, he shouldn't be getting a late model anything, but if he were planning on adding to income with the truck, again, it MIGHT be not the worst idea ever.

 

No, no, and HELL NO.

Take the price of the truck. Any truck. New, used, classic, doesn't matter. He SHOULD be writing a check for the full amount. If for some stupid reason one feels they MUST borrow:

Divide price by three (3) years. That's thirty-six months. This is the monthly nut the prospective borrower has to come up with, not including fuel, taxes, insurance and registration. Too much money?

Too much truck. Period. The End.

The reason for this is simple. Any longer term loan means the depreciation (that starts the second it is driven off the lot) will always and ever outpace repayment. This is just one reason poor people tend to stay poor. They make poor financial decisions, but then continue on with them for years. Decades, even. When he goes to trade it in, (if he makes it that far without repossession) he's still underwater, or "in the bucket" on the car note.

So it gets rolled over into the brandy new 96 month mortgage on a goddamn truck. Nuts! I like a new truck as much as the next guy, but the truth is most people aren't using their head. Businesses get a tax write off. Well to do individuals, they don't need financing. Big difference for people like that.

 

^^^^^Agree 100%

84 or 120 month auto mortgages, wow. This is why a loaded truck is now $70,000ish

 

Henry Ford would be proud of you guys! He fought for awhile against auto financing, ironically now Ford is the only domestic that still owns and controls its finance arm to my knowledge

On a serious note, I've had one customer this year do 36 month payments (and they run 50k a year) and 3 customers pay cash. The notion of not going more than 36 months is a bit outdated, regardless of right or wrong.

All that aside, I do agree for this particular case, the OP is over-reaching, and I've said so on all posts. I did allow for a scenario in which it might make more sense than buying a Bentley or something. Frankly if you have the credit for it, buy yourself a house.

 

It isn't a "notion", it makes good, smart economic sense. Technology becomes outdated maybe, not much else.

Borrowing money in the first place - to purchase a depreciating asset - is just stupid to begin with. People pay high rates of interest on thousands of dollars that must be paid back - and disappeared as soon as it is driven off the lot.

It may be common today, that doesn't equal outdated per se, just that people are getting dumber than they used to be. It is profitable and lucrative.

It was practically impossible to get insurance way back when, on a financed car. Anyone who would borrow money to buy a car was, by definition, a bad risk. Stay away.

Now you know why insurance rates cost an arm & leg for everyone today. Nothing has changed but they make damn sure you pay for it.

 

Underwater, upside down or just plain scruwed, one of the biggest problem is the inability to ever get out of debt. So many escalate their cause with the shiny new rig and a payment plan that incorporates their already upside down loan into a new loan but guess what "I can make your payments lower!! You get a brand new truck for less money!!" Ha Ha. I am getting weak in the knees about buying a 2017 when the price is soaring between $60-70K. Certain features are very desirable for a slide in camper today and despite my negative comments about the new appearance I am now in very much in favor of the 17 over the 16 (except NO green). Especially the diminished appearance of the DRW fenders. The slide in camper is going to be home for my wife and me several months a year for hopefully several years ahead so I want it nice and I want it right.

Financing: I think I can still find financing at 1.7% or less and for those of us who need to pull money from a 401K and other investment that is far better than taking it out as cash and plopping it down all at once, assuming the stock market doesn't tank. A friend pulled 25K out last year while he was still working and that pushed him to the next bracket and essentially that money cost him 15% interest. I still try to maintain the no longer than 3 year rule but I did go 4 years on my last truck. But I also made payments every 2 to 3 weeks closing the loan out in 2 1/2 years. The longer you have the lenders money the happier they are. The longer I do not have to make payments between vehicles the happier I am. Happy lenders are not always your best friend.

And also for the guys looking at 72 months and up? Do you really want to be making those payments when you are shucking out money for rotors, pads and calipers, alternators and water pumps, batteries, idler pulley's and a/c pumps, plus the toys and accessories that go along with the ride. For some it amounts to nothing because their vehicle was ideal and held together. For some it is always affordable. But for others, and it always seems to hit the marginally financed, the maintenance can be overbearing coupled with the $800 payment each month for what seems to be an eternity. And then some azz plows into you and their insurance company totals you out, well short of the amount you still owe. No good. Buy a good truck for your needs. Buy a good truck you can afford. Buy a good truck and be proud of it and be proud of yourself for making the right financial decision and marry a good partner and not a piece of iron (and now aluminum) with a payment book.

 

I guess I should add, sometimes maybe the payment book is cheaper. I witnessed some whose partners are much worse than a payment book. 24% interest credit cards not withstanding.

 

New doesn't actually lose value more than late model used does. You can't say a truck loses 30% of it's value when you walk in and get close to 20% off of that value just for showing up. Try trading a used purchase in the next day. Really, the "off the lot depreciation" concept is completely useless unless you plan to trade it in down the street on your way home.

Length of loans is something that can be tied to time and called outdated. After all, today's trucks got 200k without much trouble, that wasn't the case 30 years ago. It's still a depreciating asset, but it's an asset that last longer and and does more work that it did before.

You can also purchase maintenance plans at today's discounted prices for the entire period of the loan too, so for most companies its a monthly expense of doing business, one can know the cost of all but fuel, tires, and rotors for that 72+ month loan. It really can be made sensible from a cash flow standpoint given the right conditions.

If none of that works for you, than just lease the darn thing. While the SD trucks don't tend to lease well, a company can do a commercial lease, and at least help manage the cash flow from that perspective. So many solutions, and truly, looking at it from a 1980 perspective will lead you astray.

 

My advice is that you never borrow money to buy something you don't need, except a house. If you have any short term debt, then you are effectively borrowing money for everything you buy.

Save until you can buy what you want with cash. If you find that you really need a truck before you can buy it with cash, buy a lower cost model (e.g. an older XL).

 

If you can borrow money for a lower percentage than you can earn it then time value of money, along with the principles of opportunity cost, dictate that you SHOULD finance. I can't think of a good reason to buy something higher than an XL myself, but hey, what you do with your money is your call. You certainly won't earn more with a nicer truck beyond it's useful function. Maybe say, put cash down on the options, and finance the core truck. That would be pretty sensible from even the most conservative positions.

 

I think the F450 looks great and cannot wait for the "specs" to come out. I sure would like to find someone with an X Plan number. I bought my 2008 F350 with an X Plan number and that is probably the best way to do it.

The order sheets should be coming out soon. I'm like a kid at Christmas.

My F350 just turned 92K and it has been a great truck. Lots of extras. Should I trade it in or sell it outright?

Enjoy the road. We sure do.

bigdon68