Need opinions - Fix current car or finance?

[fahnon]

Ok, here's the situation:

 

Last year I bought a '97 Hyundai Tiburon from an aution (paid cash). Shortly after the 3 month Lemon Law expired I started having trannsmission problems. Long story short, I need a new tranny. Now between all the body work, a fresh paint ob and a new tranny we will be talking close to $4k of work that would have to be done to this car to bring it up to the level I would want it to be. Or I could take that same $4k and put it down on a newer vehicle. If I finance I will have MUCH higher costs per month as I would have to get full coverage and that would run me about $3k/yr plus the car note (and my credit is not the best as you can see in my sig). But on the other hand if I fix the existing car I pay less than $1k/yr in insurance (liability only) and no car note... But do I want to spend that much money on a '97 Hyundai? This decision has been driving me crazy (no pun intended) and I would relly like to hear some fresh ideas on the subject... Thanks

 

 

Fahnon

[MarvBear]

Ok, here's the situation:

 

Last year I bought a '97 Hyundai Tiburon from an aution (paid cash). Shortly after the 3 month Lemon Law expired I started having trannsmission problems. Long story short, I need a new tranny. Now between all the body work, a fresh paint ob and a new tranny we will be talking close to $4k of work that would have to be done to this car to bring it up to the level I would want it to be. Or I could take that same $4k and put it down on a newer vehicle. If I finance I will have MUCH higher costs per month as I would have to get full coverage and that would run me about $3k/yr plus the car note (and my credit is not the best as you can see in my sig). But on the other hand if I fix the existing car I pay less than $1k/yr in insurance (liability only) and no car note... But do I want to spend that much money on a '97 Hyundai? This decision has been driving me crazy (no pun intended) and I would relly like to hear some fresh ideas on the subject... Thanks

 

 

Fahnon

 

Hello Fahnon:

 

I personally would not wish to direct you in either way. I am not a qualified financial planner. You should weigh your options carefully is about the only advice I feel comfortable giving.

 

However if you choose to seek a newer automobile, I would be happy to help you out with any questions you might encounter if I have knowledge in the area you seek.

[LogicalOne]

Fahnon: May I offer this tid bit of calculations to aid in your decision:

Take the value you paid Example : 3, 000 plus current expenses ( ie: tranny, paint, bodywork) Total that up. Exp: $7,000 total investment . Now search the Blue book value. If your costs thus far exceed the re-sell value then its best to refinance on a newer car. Word of wisdom for older cars. Never put in more then 50% of the total cars net value unless its an antique or classic which can fetch a pretty penny

[Nautica_21]

"Take the value you paid Example : 3, 000 plus current expenses ( ie: tranny, paint, bodywork) Total that up. Exp: $7,000 total investment . Now search the Blue book value. If your costs thus far exceed the re-sell value then its best to refinance on a newer car."

 

Not necessarily, this may be true if the OP intends to re-sell the vehicle. If the OP intends to keep the car till it dies "Who cares what the re-sale value is?" Financing a vehicle can be very expensive and since the OP pointed out that his credit rating is not the greatest then he may end up loosing a lot more money by financing a vehicle. After all, by financing a vehicle you are not only loosing money due to depreciation but also to finance charges.

 

Fanon,

 

I would suggest re building the transmission with a reputable individual or business who offers a good warranty on their job. Body work and a paint job are all cosmetics (assuming that the body work is not related to a safety issue) and therefore not necessary for the car to take you from point A to point B. Save some cash (the same payment you would be making on a car note) and set it aside on an acct that yields the best possible rate with minimal risk. Once you have enough to buy a "reliable" car, pay cash thus saving money on interest and possibly insurance. :wink:

[fahnon]

Thanks all who replied! Nautica your plan is definately a good one and you are correct in assuming I don't ever plan to sell this car. I do plan to buy my first home in the next couple of years and I've been leaning in the direction of not getting something new now because of that. Thanks. You were all very helpful in me getting a fresh perspective Marv: even though you did not give any actual advise, the way you worded your response made me stop thinking of it so emotionally (I am very attached to this car . it was my first) and more like it's a business decision. Thanks again everyone.

 

Fahnon

[MarvBear]

Thanks all who replied! Nautica your plan is definately a good one and you are correct in assuming I don't ever plan to sell this car. I do plan to buy my first home in the next couple of years and I've been leaning in the direction of not getting something new now because of that. Thanks. You were all very helpful in me getting a fresh perspective Marv: even though you did not give any actual advise, the way you worded your response made me stop thinking of it so emotionally (I am very attached to this car . it was my first) and more like it's a business decision. Thanks again everyone.

 

Fahnon

 

Fahnon; The very thing that gets most people in trouble concerning a car is the fact that they are so emotional about it/what they drive etc.

 

If one takes ego out of the picture, and I shall be the first to admit that is extremely difficult then I believe your decisions will be more financially sound.

 

Questions such as yours for me at least are quite difficult to formulate a response to.

 

Thats why we have to many members chime in to help. It is always beneficial to learn about something from another perspective.

 

i am glad you are here with us at creditboards, and I personally thank you for your kind comments.

[Nautica_21]

Fahnon,

 

You sound like you are in the right track. Keep up the good work!

[fahnon]

Well the decision was made for me after all... Took the car to get inspected at a trustworthy mechanic and it will require new rear struts and an exhaust manifold. Total cost would be almost $1k and that's not including tranny/bodywork..... I think I would officially be foolish of me to put that kind of money into a car that has had probs from the beginning. It's like I'm buying a new car piece by piece! I'm kind of upset and disappointed, but also a little excited that I will be getting a new car.

 

Fahnon