Can someone inform me of what the policy is here? I had heard most banks will only put a loan at 72 months if the car is 2 or 3 years old? Is there a general rule? I am thinking of buying a new car and am trying to determine where my payments will be, etc.

 

Are you planning to buy an actual 'brand new' car OR a 'newer' car that is 2 - 3 years old & finance it for 6 years? Long car loan btw....ouch.

 

Likely different banks and credit unions have different policies so you'll have to shop around.

If you're looking at a 6 year note, even on a new car, you're gonna be upside down the whole time, which means that when you're tired of your car and want to do another nice long note on yet another car, you'll be even MORE in the hole.

Fwiw, from a fiscal responsibility standpoint, I'd scale back my ambitions vehicle-wise and save until you can put a big enough down payment that you won't be going farther into debt with every subsequent payment.

 

My friends family bought a 2000 toyota echo in late '99, and truth be told... the car would have been 11,000 cash, and with the 6 year financing plan, it'll come out to a little over 18,000 when they finish payments on it in about a year.

Meanwhile my lexus was paid in cash and cost me much, much, much less for a car that is so far beyond that.

 

I noted your other post, perhaps you should look into simply refinancing your CL500. Depending on what your payoff is, you could do one or a combination of the following:

1. Lower your interest rate

2. Extend the life of the loan

If you are willing to start out of the gate with a 6yr note (not to mention taxes, down payment, etc), it may be more advantageous to add another year to your CL loan (in essence you are almost starting over with the same car, but no fees!)

Good luck, I really love the W215 coupes!

 

I know many people take long loans like this, but I recommend never getting a loan longer than 48 months unless you get a 0% interest rate. And it is always preferable to do 36-39 months. Otherwise you are probably buying more car than you can really afford.

 

My whole reasoning behind the 72 month thing is not putting money down upfront. I have the money, I just dont want to put money into a car that is a depreciating asset. You really cant win with cars that cost over $50-60k if you only like keeping cars for 2 years max like I do. I put 20k cash down on my CL, which pretty much went out the window.

I was thinking of buying a used SC430 or used E65 7 series...only because why pay $75k for the SL500 now, when next year it will be $55k, and well under $50k in 2 years.

Obviously, putting no money down on an expensive car will bite me in the *** when I sell it, because I will be upside down. If I get a SC for $48 and pay $750 for 6 years....sell it after 2 wheras I still owe probably 30k, I doubt in 2 years the SC430 will be worth $30k. Thats akin to saying the 2000 SC400's are $30k, when they are mostly at $20k.

Now how would I go about adding another year onto my current loan? I wasnt sure if that was a possibility, but it would be nice.

 

I understand your point about sinking money into a depreciating asset (cars are really sensitive to market conditions which makes it even worse).

What you can do it call your credit union, or personal bank and apply for refinance / balance transfer. (hopefully at a lower APR). When you do this, they will ask you what you want the term to be, I think you said the CL is a 2000, so they will let you do up to 60months or so.

Since you are willing to sell the car anyway, it helps to think of this as selling your own CL, then buying and financing it again starting today (minus all the fees, taxes, etc etc)

I want a CL really bad, but jeesh 950/month for a "toy" ( I have a work vehicle / everyday driver) is a tough one!!!

Good luck

 

Makes more sense mjr24.

Have you ever thought of leasing, that way you only pay for what you use and hand them the keys at the end. I did that with my current 2002 GS430 because the option at the end is about equivalent to what I could sell it for ($28,500) give or take a few bucks.

This reduces your upfront money and you don't really have to worry about depreciation. I know this might not be an option on your current car that you are trying to extend by one year but it might be an option on a future vehicle. Plus it helps you avoid the luxury tax (I believe).