Car leasing

[Ted]

Yeah, mine had more than paid for itself in the 250,000 miles I put on it in 3 years, and still had near a $12,000 residual value when I sold it, plus I claimed a warranty transmission in that period. The personal and farm use were pure cream off the deal.

Mine more than paid for itself in 108,000 miles, but I could've put those miles on a truck with a lower capital cost and not much lower residual.

 

[Henning]

Mine more than paid for itself in 108,000 miles, but I could've put those miles on a truck with a lower capital cost and not much lower residual.

True, if I had the same job to do again I would get an FL-50 with a sleeper and a boom system.

 

[Jimmy cooper]

There used to be a program in TV called " can you top this?" Henning reminds me of this program. His latest.......driving 250,000 miles in three years?!
Please elaborate. Why would anyone do this?! I sure would not .

 

[cowman]

In 2002 I bought a 98 Ford Crown Victoria police package used with 70,000 miles on it for $6,000. I had it until I traded it off in 2012, I think I got about 1500 out of it. Probably could have kept it going for a few more years. I put at least one set of tires on it, and did regular oil changes but other than that I'm pretty sure I had less than $500 in repairs in all that time. That was absolutely the most cost effective vehicle I ever had and never did a car payment.

Now I'm in a Mustang.. because I'm a car geek and I like it. I enjoy my Mustang, but if I didn't have enough money to buy something like that in cash I wouldn't have. I'd have kept driving my crown vic.

 

[35 AoA]

wow, are there actually people who pay 9% interest on an auto loan? I kinda though 2-3% was about average, at least for avg credit, etc

 

[Ted]

True, if I had the same job to do again I would get an FL-50 with a sleeper and a boom system.

What I should have bought at the time was a 4x4 Excursion with a 7.3 PowerStroke. They were about $20k at the time with 50k miles on them. I could've slept in that just fine and would've done what I needed to. I ended up buying a V10 4x4 Excursion after selling the Dodge and going through a Jeep Cherokee and a Chevy Suburban 454. The Excursion, hands down, is the best vehicle I've ever owned.

There used to be a program in TV called " can you top this?" Henning reminds me of this program. His latest.......driving 250,000 miles in three years?!
Please elaborate. Why would anyone do this?! I sure would not .

Sounds like he was driving professionally. I put 108,000 miles on the Dodge and owned it two years to the day. The first year I put 65,000 miles on it, 30,000 of which I put on it in 3 months when I was towing cars around the country to make a living.

It's not a bad job. I probably drove close to 200,000 miles during college, and I loved every mile of it. No wonder I love to fly long trips so much. I've figured going back to driving would make a good retirement job.

 

[Jimmy cooper]

Yes....9 percent and more! the car industry is quickly back up to its old tricks. Subprime loans. Poor documentation, very low down payments, high Intrest, same goings on that caused the 2007 calamity. It's happening in houses too.....again. "No money down! call today!" They even have cal Ripken as barker on TV.
Another taxpayer bailout in the making.

 

[RJM62]

You bought Life Insurance with a car transaction?

Yeah, any time I take out a loan from my CU, I take the life and disability insurance on the loan. It's so cheap that it doesn't pay not to.

I also tend to finance so the payments comes out to about half what I feel comfortable paying every month, and then I pay double. This is something I started doing after the Great Recession hit. A number of my clients went belly-up, and things were tight for a while. And quite frankly, I'm not all that convinced that we've seen the worst of it, so I like to give myself a big cushion. The extended loan terms are part of that plan.

The upside is that I generally pay off my loans in half their terms (or less). The downside is that I usually pay slightly higher interest because of the longer terms. But I get some peace of mind in return.

Rich

 

[Henning]

There used to be a program in TV called " can you top this?" Henning reminds me of this program. His latest.......driving 250,000 miles in three years?!
Please elaborate. Why would anyone do this?! I sure would not .

Running trailers for manufacturers to dealers for two of those years, 110,000 miles a year is easy when you are driving for a living and don't need to run a log book. The first year I had it I was recovering planes for insurance companies and hauling them to where ever it was supposed to go, or to Al's storage, I did 30,000 that year.

 

[wsuffa]

One of the issues that terminated my sales relationship at Landrum Chevrolet, directly by Sheppard AFB was that I would not participate in the "Airman Finance Program". Basically there is a company called "The Finance Company" that specializes in financing military personnel. What they do is figure out half of the remaining pay in the soldiers hitch, reverse calculate 21% interest, kick back 3 points to the dealer and keep 18%. When this fee was subtracted from the 50% residual income figure, it would determine what was available to spend on the car. So, since these figures were pretty constant by grade as this was often their first training base, the management wold buy cars that would fit these $ amounts with a 50-100% margin, then segregate these groups into E-1, E-2, E-3... Sections to direct people. The loans would be secured by them signing over an allotment against their pay. Their car costs them half their pay for the rest of their hitch basically, and most of them won't last that long. This is a huge ripoff and I refused to participate. I would however put an airman in a new Cavalier for a smaller payment, if a parent or grandparent had decent credit to co-sign, I could get them 0.9-2.9% interest on a three year loan with $750 down and a $189 a month payment.

I think it's morally wrong to take advantage of the stupid, to take advantage of a stupid soldier makes it kinda reprehensible even. I sold enough Cavaliers and GEO Metros and Trackers that he couldn't *****, but neither he nor I made the money that could have been made by ripping them off. What ended our relationship was cold calls. That's right, he wanted us to get in the phone book and cold call 40 people a day, I refused, I don't SPAM be it on computer or phone. "But you have to." "No, I don't. Now you can choose to further employ me or not, but I will not be making those calls."

He was out of business in another year anyway. The only way to survive long term in the car business is by being morally scrupulous and upstanding. By providing a benefit to the locals, not taking advantage of them or alienating them.

In some places these days, the base commanders make certain dealers and finance companies off-limits if they engage in unethical behavior. Kudos for having the guts to stand up for what was morally right.

 

[flyingcheesehead]

It's not a bad job. I probably drove close to 200,000 miles during college, and I loved every mile of it. No wonder I love to fly long trips so much. I've figured going back to driving would make a good retirement job.

There was a guy who drove at my old company who was a retired FSS briefer! He and his wife owned a very nice Freightliner named "A Workin' RV" and got paid to drive their "RV" around the country. Not a bad way to go about "retirement!"

 

[flyingcheesehead]

Running trailers for manufacturers to dealers for two of those years, 110,000 miles a year is easy when you are driving for a living and don't need to run a log book.

I used to do over 130,000 a year WITH a logbook. Pretty standard if you know what you're doing and don't mind actually working.

 

[N747JB]

2-3% is generally for folks with good credit, 700+ Beacon scores, a lot depends on how a deal scores and which bank will buy it. 9% certainly isn't the upper end of the rates, but it's high for a newer car and B+ or better credit. I know some folks with repos and bankruptcies that would LOVE a 9% rate!

wow, are there actually people who pay 9% interest on an auto loan? I kinda though 2-3% was about average, at least for avg credit, etc

 

[35 AoA]

In some places these days, the base commanders make certain dealers and finance companies off-limits if they engage in unethical behavior. Kudos for having the guts to stand up for what was morally right.

yeah, agreed. There were about a half dozen "off limits" car sales places in the Norfolk/Hampton/VA beach area when I was there due to this. Same for San Diego

 

[N747JB]

It would be great if you had any idea of what you talk about, even once!
People with bad credit need cars too, and who's going to loan them money at the same rate of someone with great credit and income?? We get loans for people that need a way to work and haven't paid their bills on time. It's not a car dealer trick, it's banks taking big risks to reap big rewards.

Yes....9 percent and more! the car industry is quickly back up to its old tricks. Subprime loans. Poor documentation, very low down payments, high Intrest, same goings on that caused the 2007 calamity. It's happening in houses too.....again. "No money down! call today!" They even have cal Ripken as barker on TV.
Another taxpayer bailout in the making.

 

[flyingcheesehead]

Well... The trigger has been pulled. After the reminder about the EAA X-Plan deal (Thanks, Randy and Stan!) I checked into that more. I also found a young salesman at a local dealer who wasn't a bull****ter and gave me all of the numbers I asked for to calculate TCO.

I actually ended up about $6,000 below X-Plan due mostly to lease incentives on the Energi that made it cheaper than the regular hybrid Fusion, and 8-year total cost of ownership (that's how long I've owned my cars in the past) if I buy it out at the end of the lease is about $1,000 less than buying the gas-powered Fusion.

I'll let you know if I regret it later.

 

[flyingcheesehead]

OBTW - When I walked in, the sales manager was there and when I mentioned getting the X-Plan through EAA, he told me that Paul Poberezny once bought a car from him!

 

[denverpilot]

Well... The trigger has been pulled. After the reminder about the EAA X-Plan deal (Thanks, Randy and Stan!) I checked into that more. I also found a young salesman at a local dealer who wasn't a bull****ter and gave me all of the numbers I asked for to calculate TCO.



I actually ended up about $6,000 below X-Plan due mostly to lease incentives on the Energi that made it cheaper than the regular hybrid Fusion, and 8-year total cost of ownership (that's how long I've owned my cars in the past) if I buy it out at the end of the lease is about $1,000 less than buying the gas-powered Fusion.



I'll let you know if I regret it later.

Congrats.

Don't bother regretting it. It's not worth the time spent on the regret. Just drive it.

 

[Jimmy cooper]

It would be great if you had any idea of what you talk about, even once!
People with bad credit need cars too, and who's going to loan them money at the same rate of someone with great credit and income?? We get loans for people that need a way to work and haven't paid their bills on time. It's not a car dealer trick, it's banks taking big risks to reap big rewards.

It's all about privatizing profit and socializing losses. That's how the banks worked in 1929 and again in 2007. The car dealer simply pimps for the money people. It's deregulation that caused it then and will cause it again, sooner rather than later. Grow up! No doc loans, not checking references, etc. all adds up to taxpayers eventually having to pay the tab. If you have bad credit.....walk, take a bus!

 

[RotorAndWing]

It would be great if you had any idea of what you talk about, even once!

This is PoA, not a requirement........

 

[Jimmy cooper]

You have that right.

 

[mjburian]

Well... The trigger has been pulled. After the reminder about the EAA X-Plan deal (Thanks, Randy and Stan!) I checked into that more. I also found a young salesman at a local dealer who wasn't a bull****ter and gave me all of the numbers I asked for to calculate TCO.



I actually ended up about $6,000 below X-Plan due mostly to lease incentives on the Energi that made it cheaper than the regular hybrid Fusion, and 8-year total cost of ownership (that's how long I've owned my cars in the past) if I buy it out at the end of the lease is about $1,000 less than buying the gas-powered Fusion.



I'll let you know if I regret it later.

Congrats on the new ride!

 

[Henning]

It's all about privatizing profit and socializing losses. That's how the banks worked in 1929 and again in 2007. The car dealer simply pimps for the money people. It's deregulation that caused it then and will cause it again, sooner rather than later. Grow up! No doc loans, not checking references, etc. all adds up to taxpayers eventually having to pay the tab. If you have bad credit.....walk, take a bus!

How to deal with that:

http://collectivelyconscious.net/ar...in-the-news-but-is-not/#.VFKpM42Xefv.facebook

 

[Ted]

There was a guy who drove at my old company who was a retired FSS briefer! He and his wife owned a very nice Freightliner named "A Workin' RV" and got paid to drive their "RV" around the country. Not a bad way to go about "retirement!"

I more or less had that sort of idea. Although I liked my no logbook, cash only business.

 

[N747JB]

Again, you have no clue about how auto financing works in today's world, thus isn't the 2002 mortgage market, it's car loans, short term loans. Secondary lenders verify everything on the credit apps, including references. They call employers, landlords, get copies of utility bills, it's not easy getting a car loan in the sub-prime world. And people with crappy credit are higher risks and pay a higher rate. If they can't verify the info, they go to a buy here pay here lot.

It's all about privatizing profit and socializing losses. That's how the banks worked in 1929 and again in 2007. The car dealer simply pimps for the money people. It's deregulation that caused it then and will cause it again, sooner rather than later. Grow up! No doc loans, not checking references, etc. all adds up to taxpayers eventually having to pay the tab. If you have bad credit.....walk, take a bus!

 

[Henning]

Again, you have no clue about how auto financing works in today's world, thus isn't the 2002 mortgage market, it's car loans, short term loans. Secondary lenders verify everything on the credit apps, including references. They call employers, landlords, get copies of utility bills, it's not easy getting a car loan in the sub-prime world. And people with crappy credit are higher risks and pay a higher rate. If they can't verify the info, they go to a buy here pay here lot.

I have no problem selling B&C paper where the risk and cost are compatible. Thing with the Airman Program, if we are securing an allotment on an Airman's paycheck, direct deposit, and said airman has already made it through basic and is in advanced training, that Airman should be paying A+ rates, not the maximum the law will allow. That is taking an immoral advantage of someone basically just out of high school and not very savvy. All they know is that they can drive away in a shiny 15 year old Trans Am that cost $3500 at auction and they don't have to worry about a down payment or anything, best part is you can drive it back to base tonight. Oh yeah, it's only going to cost you $10,000 of your pay, and if you get kicked out, you're still liable for your payment.

These are the types of activities that give car dealers a bad name. The boys would always choose a flashy POS, I sold mostly to girls.

 

[N747JB]

Sounds like you worked for a "Bill Heard" type of dealer, screw everybody they can as long as they can, new people are moving in every week! That seems to be more common in military areas and areas with high resident turnover. Actually with the Internet, those folks find it harder to make a living treating people, especially soldiers, like crap and it's a good thing. Those are the kinds of dealers that give the rest of us a bad name!

I have no problem selling B&C paper where the risk and cost are compatible. Thing with the Airman Program, if we are securing an allotment on an Airman's paycheck, direct deposit, and said airman has already made it through basic and is in advanced training, that Airman should be paying A+ rates, not the maximum the law will allow. That is taking an immoral advantage of someone basically just out of high school and not very savvy. All they know is that they can drive away in a shiny 15 year old Trans Am that cost $3500 at auction and they don't have to worry about a down payment or anything, best part is you can drive it back to base tonight. Oh yeah, it's only going to cost you $10,000 of your pay, and if you get kicked out, you're still liable for your payment.

These are the types of activities that give car dealers a bad name.

 

[Sam D]

It's all about privatizing profit and socializing losses. That's how the banks worked in 1929 and again in 2007. The car dealer simply pimps for the money people. It's deregulation that caused it then and will cause it again, sooner rather than later. Grow up! No doc loans, not checking references, etc. all adds up to taxpayers eventually having to pay the tab. If you have bad credit.....walk, take a bus!

Sounds like your issue is more with the govt creating moral hazard.

 

[Henning]

Sounds like you worked for a "Bill Heard" type of dealer, screw everybody they can as long as they can, new people are moving in every week! That seems to be more common in military areas and areas with high resident turnover. Actually with the Internet, those folks find it harder to make a living treating people, especially soldiers, like crap and it's a good thing. Those are the kinds of dealers that give the rest of us a bad name!

Yeah, it was awful and the GM/49% owner (the 51% owner held the franchise) was an idiot. Every 2 weeks he would spend $20k on some business scheme and some motivational shaman would come in and we would be provided the accoutrements to their sales system. The Cold Call, "It's all a numbers game," dude I walked out of the training, I couldn't bear the idiocy any longer. I had made him an offer to set up an effective marketing program, (we had zero advertising, in the time I was there we ran 3 commercials, 3 total, no thoughts even toward that new Internet thing.) but he didn't believe we needed any TV, radio, or billboard adverting. In fact, our competitor had the billboard that blocked the SE bound highway view of our sign!

No, he was relying on airmen to feed him and lost the long term local base and failed within 5 years of opening.

If you're going to go to a car dealer, go to one that's been around a while, you don't survive in the business if you are dishonorable.

 

[WakeNCAgent]

I have a cousin that owns a car dealership. I was visiting with him at work when a salesman walked over and said he had a lady that wanted to buy one of the new BMW's cash. He quickly sent his best salesman over and a short while later the lady was driving off the lot with her newly leased vehicle. Everyone was high-giving each other as she drove off. They more than quadrupled their profit that day, according to my cousin.

 

[Henning]

I have a cousin that owns a car dealership. I was visiting with him at work when a salesman walked over and said he had a lady that wanted to buy one of the new BMW's cash. He quickly sent his best salesman over and a short while later the lady was driving off the lot with her newly leased vehicle. Everyone was high-giving each other as she drove off. They more than quadrupled their profit that day, according to my cousin.

Yeah, no back end on a cash deal. When I bought my truck new with cash, oh they kept trying to get me to finance it. "Thanks, no."

 

[RalphInCA]

If you get the 0%, not many people walk out f the F&I office with that deal.

Good point. And by the time they realize they aren't getting the deal they thought to they were getting, they are so far into negotiations, with some much time invested, that they say: "What the hell, let's just get the damn thing, I'm tired of all this..."

Which, of course is what the dealer wants you to say.

There's probably a term for this.

 

[Henning]

Good point. And by the time they realize they aren't getting the deal they thought to they were getting, they are so far into negotiations, with some much time invested, that they say: "What the hell, let's just get the damn thing, I'm tired of all this..."

Which, of course is what the dealer wants you to say.

There's probably a term for this.

There is, it's so well known, that it even gets used as an example in the definition of the most versatile word in the English language: "I got ****ed at the car dealer."

 

[denverpilot]

Good point. And by the time they realize they aren't getting the deal they thought to they were getting, they are so far into negotiations, with some much time invested, that they say: "What the hell, let's just get the damn thing, I'm tired of all this..."



Which, of course is what the dealer wants you to say.



There's probably a term for this.

I call it, "time to leave".

 

[jesse]

Last car I bought was about 18 months ago. Cost me $1,500. Wrote a check, and put about 30,000 trouble free miles on it, had to replace to alternator about a week ago...

Before that was my F150, wrote a $7,000 check, then dropped about another $2,500 into it the next couple weeks fixing things. Still don't trust the damn thing farther than I can push it.

 

[Ted]

Last car I bought was about 18 months ago. Cost me $1,500. Wrote a check, and put about 30,000 trouble free miles on it, had to replace to alternator about a week ago...

Before that was my F150, wrote a $7,000 check, then dropped about another $2,500 into it the next couple weeks fixing things. Still don't trust the damn thing farther than I can push it.

Yeah, but Honda Accords are notoriously boring and reliable. Your F150 seemed to have been owned by my mother before.

I do more auto MX than most, but I'm anal about mechanical performance, buy unreliable (but fun) cars, and I modify most of my vehicles.

 

[RJM62]

Probably the best overall deal I ever made on a car was a 2000 Kia Sportage that I bought in 2010 for $1,250.00 cash. I drove it hard for three years as a DD, and a fourth year as a winter rat, for a total of about 74,000 miles.

Other than routine things like brakes and such, I put in a gas tank, a set of plugs, a power steering pump, a power window switch, a blower motor resistor, fuel pump, a fuel filter, and a battery over the years, for a total of a bit over $800.00 in repairs. Then I sold it earlier this year for $1,000.00.

Rich

 

[SCCutler]

I bet you're gonna love the Fusion, Kent; I have friends who drive a Fusion Hybrid, and it is stupidly nice, and darned near manufactures its own fuel.

 

[Geico266]

Yeah, no back end on a cash deal. When I bought my truck new with cash, oh they kept trying to get me to finance it. "Thanks, no."

You might be missing an opportunity. Next time go the financing route. You can usually get a lower price on the vehicle, then pay it off before the first payment. I've done this twice now.

 

[Henning]

You might be missing an opportunity. Next time go the financing route. You can usually get a lower price on the vehicle, then pay it off before the first payment. I've done this twice now.

I already had the 'financed price', I didn't let them know it was a cash deal until they had all the paperwork figured out.