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Should I trade in my 4runner? Payments left.

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I bought an suv that was 28k but I had positive equity which I paid my earlier suv of so I got 8k for my trade but with taxes and title etc... my financed amount is 21.6k. Now I have owned the car since may of 2020 and I like it but I have a loan left of 17.6k. Thats not bad since may right? Paid off more then 4k since may but I finally realized I gotta save up for a house now as much as I like my current 4runner that I have and payments are only $488 a month but I tend to over pay if possible on the principle loan only. I figure I would pay of within less then 20 months which isn't to bad but I am 26 and starting to realize that getting a house is better as I will be able to get another suv/car I want later. Anyways I am looking at this 1996 honda accord lx for 4k with 103k miles which isn't to bad but come on its a honda accord with a manual and it looks clean. honda accord I figured I could pay that of within bout maybe say 6 months or less then that 20 months I have with my 4runner and buy a house then buy another 4runner or other cars I want later after I get a house. That honda could less me awhile and its in decent shape for a 1996. I don't mind driving old cars. All the cars I have driven have been old other then an s550 mustang which was a 2015 even that was old because I got it at 35k miles.  

 

Just trying to figure out if its a smart idea to get rid of a more payment loan and to roll over to a less payment and finish that less payment to get into a house because my credit score could use some work. 


https://imgur.com/a/6FJF4GY

 

Edited by helpmeout

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1996 honda accord lx 

 

they still make parts for a 25 year old vehicle?  In 5 more years it will be considered an antique here in Florida.   

 

I do not want to offer you financial advice that might interfere with your house hunting, so if you wish, I can move this to Money Management forum or Mortgage forum.   I'm at your command.

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4 hours ago, MarvBear said:

1996 honda accord lx 

 

they still make parts for a 25 year old vehicle?  In 5 more years it will be considered an antique here in Florida.   

 

I do not want to offer you financial advice that might interfere with your house hunting, so if you wish, I can move this to Money Management forum or Mortgage forum.   I'm at your command.

Sure, if that will help. Honda parts are cheap and especially it being a manual it will last longer then me even if I keep it for that long. Like I said for 100k something miles it’s not bad and it’s in decent shape for being 4K. You can get parts at junk yard if needed because this car is so common. I’ll miss my 4runner but I have had so many cars that losing this to buy a house isn’t to bad. I would pay 1k again this month and it would down to 16.6k this month but like I mention if I get that accord I will probably finish within 6 months or less. Instead of less then 20 months with the 4Runner.

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1 hour ago, CreditCurious20 said:

A vehicle that old strikes me as a money pit. 

my stable has a few older than this and one has become my covid daily driver because the 2018 I bought for a daily driver is too boring and predictable.

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Honestly, the installment loan isn't going to affect your FICO scores all that much (unless it has negatives).  One thing that isn't clear, do you need to finance that Accord?  If so, you are in no position to be buying at house at this point.  You'll need 20% down, plus reserves and closing costs, plus have a decent emergency fund.  As far as trading out the car, you need to look at the whole picture not just the cost of the car vs. the balance on the loan (plus interest).  What is the difference in insurance? Gas?  You need to factor in additional maintenance on the Honda vs the 4 runner.  Also, do you have an alternate form of transport should the Honda require an extensive repair, and can you do those repair yourself?  If not factor that as well.  Point is you need to understand all the costs to make a good decision.

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On 9/9/2020 at 2:25 PM, CreditCurious20 said:

A vehicle that old strikes me as a money pit. 

Older cars can often be easier to work on and don't have NEAR the number of electrical screw-ups as newer models.  Better yet is that they generally don't have to meet current emissions testing standards and, in some States, qualify for classic status.  Insurance is ALSO a lot cheaper on many of them...

 

Surprisingly, the one thing becoming the biggest challenge on the Miata is getting good tires in a 14" diameter that offer some level of performance without being a true race tire. 

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On 9/9/2020 at 3:25 PM, CreditCurious20 said:

A vehicle that old strikes me as a money pit. 

You will be surprised how reliable old hondas and toyotas are. Plus its 1996 meaning no electrical nannies that would be expensive to fix like old bmws or old mercedes

On 9/9/2020 at 4:07 PM, hegemony said:

my stable has a few older than this and one has become my covid daily driver because the 2018 I bought for a daily driver is too boring and predictable.

 

On 9/11/2020 at 10:41 AM, centex said:

Older cars can often be easier to work on and don't have NEAR the number of electrical screw-ups as newer models.  Better yet is that they generally don't have to meet current emissions testing standards and, in some States, qualify for classic status.  Insurance is ALSO a lot cheaper on many of them...

 

Surprisingly, the one thing becoming the biggest challenge on the Miata is getting good tires in a 14" diameter that offer some level of performance without being a true race tire. 

Yeah and that accord looks like its in great shape also!

On 9/11/2020 at 8:33 AM, CTSoxFan said:

Honestly, the installment loan isn't going to affect your FICO scores all that much (unless it has negatives).  One thing that isn't clear, do you need to finance that Accord?  If so, you are in no position to be buying at house at this point.  You'll need 20% down, plus reserves and closing costs, plus have a decent emergency fund.  As far as trading out the car, you need to look at the whole picture not just the cost of the car vs. the balance on the loan (plus interest).  What is the difference in insurance? Gas?  You need to factor in additional maintenance on the Honda vs the 4 runner.  Also, do you have an alternate form of transport should the Honda require an extensive repair, and can you do those repair yourself?  If not factor that as well.  Point is you need to understand all the costs to make a good decision.

I will have atleast 1k or 2k in equity if I trade in my 4runner so it wont be much to pay off considering my 17.6k 4runner. will be 16.6k soon but I will have that paid of much faster if I were to get that accord. Gas will be cheaper of course since its going from a truck 4wd v6 to a car fwd 4 cylinder. Gas will also be cheaper since the car will be more efficient and maintenance is cheaper to. 

 

I don't need to get rid of my 4runner. I could afford the payments. My payments are 385.35 for the 4runner, now I don't have to pay 1k but I want to finish of the car loan so that way I don't have to worry bout the 4runner and just get a clean title in bout 20 months or less or I could get a clean title to that accord in bout 5-8 months and not have any payments left. I do have money but I am just trying to find a way quicker to getting a house because I am 26 and I need to get my own house. I don't want to rent anymore as I am getting no where with renting.

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I think there are other factors.  Whats the interest rate?  Whats the payoff?  Is it the ONLY vehicle?  How much is it currently worth? Whats your total income AFTER taxes?

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On 9/13/2020 at 7:47 AM, helpmeout said:

You will be surprised how reliable old hondas and toyotas are. Plus its 1996 meaning no electrical nannies that would be expensive to fix like old bmws or old mercedes

 

Yeah and that accord looks like its in great shape also!

I will have atleast 1k or 2k in equity if I trade in my 4runner so it wont be much to pay off considering my 17.6k 4runner. will be 16.6k soon but I will have that paid of much faster if I were to get that accord. Gas will be cheaper of course since its going from a truck 4wd v6 to a car fwd 4 cylinder. Gas will also be cheaper since the car will be more efficient and maintenance is cheaper to. 

 

I don't need to get rid of my 4runner. I could afford the payments. My payments are 385.35 for the 4runner, now I don't have to pay 1k but I want to finish of the car loan so that way I don't have to worry bout the 4runner and just get a clean title in bout 20 months or less or I could get a clean title to that accord in bout 5-8 months and not have any payments left. I do have money but I am just trying to find a way quicker to getting a house because I am 26 and I need to get my own house. I don't want to rent anymore as I am getting no where with renting.

Even if you get rid of the 4 runner you are not in a position to even look at buying a house, based on you implying that you don't have $4k to pay for that accord in cash.  You realize you need 20% down otherwise you will be saddled with PMI which is akin to lighting money on fire.  Add to that having an emergency fund of at least 6 months (the bank will require you to have 3 months of reserves as it is), plus closing costs (usually a few thousand dollars), plus some extra for when shizz happens (and any home owner will tell you shizz will happen).  Even if you dump the 4 runner today, it doesn't mean you will be ready for a house tomorrow.

 

That is why I said you need to look at the costs over the next couple of years.  When you add it all up (factoring in everything I mentioned above), will you be that much ahead financially?  Lastly, where did you get the value on your 4 runner?  Was that an actual offer (like from a dealer, carmax, carvana, etc) or just a KBB value.  If it is the latter you may be in for a shock.

 

I get what your thinking, and on the surface it isn't a bad thought to try to cut as many expenses as possible.  Just need to be sure it makes overall sense.

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6 hours ago, CTSoxFan said:

Even if you get rid of the 4 runner you are not in a position to even look at buying a house, based on you implying that you don't have $4k to pay for that accord in cash.  You realize you need 20% down otherwise you will be saddled with PMI which is akin to lighting money on fire.  Add to that having an emergency fund of at least 6 months (the bank will require you to have 3 months of reserves as it is), plus closing costs (usually a few thousand dollars), plus some extra for when shizz happens (and any home owner will tell you shizz will happen).  Even if you dump the 4 runner today, it doesn't mean you will be ready for a house tomorrow.

 

That is why I said you need to look at the costs over the next couple of years.  When you add it all up (factoring in everything I mentioned above), will you be that much ahead financially?  Lastly, where did you get the value on your 4 runner?  Was that an actual offer (like from a dealer, carmax, carvana, etc) or just a KBB value.  If it is the latter you may be in for a shock.

 

I get what your thinking, and on the surface it isn't a bad thought to try to cut as many expenses as possible.  Just need to be sure it makes overall sense.

Im not saying that I will get a house within a few months. I could get it within a yr and a half if I were to get that accord however that accord sold already or is sent back to the auctions. Any how that accord is good compare to most other cars because insurance is heck cheaper and like I mention maintenance is cheaper and they are also reliable as hell.

 

I may go with a loan through navy federal as they don't require PMI for there house loans. I got 2 credit cards through navy federal and I got a checking line of credit through them to. I started my credit journey with navy federal Nrewards secured credit card and now that card is 14.99% interest with no security deposit on it(its called Visa Signature GO rewards now) so I am sure I can get a good loan through navy federal. I also have a visa platinum credit card through them with 15.99 interest and that has a my limit on that card is 8.5k and 5k on visa signature go rewards. I have had there bank since 2014 and they been pretty good to me approving everything I do with no hassle. I also got 

https://www.navyfederal.org/loans-cards/mortgage/why-choose-navy-federal.php 

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2 hours ago, helpmeout said:

Im not saying that I will get a house within a few months. I could get it within a yr and a half if I were to get that accord however that accord sold already or is sent back to the auctions. Any how that accord is good compare to most other cars because insurance is heck cheaper and like I mention maintenance is cheaper and they are also reliable as hell.

 

I may go with a loan through navy federal as they don't require PMI for there house loans. I got 2 credit cards through navy federal and I got a checking line of credit through them to. I started my credit journey with navy federal Nrewards secured credit card and now that card is 14.99% interest with no security deposit on it(its called Visa Signature GO rewards now) so I am sure I can get a good loan through navy federal. I also have a visa platinum credit card through them with 15.99 interest and that has a my limit on that card is 8.5k and 5k on visa signature go rewards. I have had there bank since 2014 and they been pretty good to me approving everything I do with no hassle. I also got 

https://www.navyfederal.org/loans-cards/mortgage/why-choose-navy-federal.php 

This is not true.  They have what is called Lender paid PMI or LPMI.  It is where there is PMI but the lender pays for it.  You pay for it in a higher interest rate than you could get if you were putting down 20%.

 

Note, not trying to piss in your corn flakes here, just want you to make sure you're as informed as possible...

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Also, when you're looking at mortgage options from Enneffseeyou, note that the published rates generally require you to pay points upfront AND also require you to pay 1% of the loan amount as an origination fee (which is unconscionable on its own on even an average loan amount) or accept a higher interest rate.

 

All loans subject to credit approval. Rates quoted require a loan origination fee of 1.00%, which may be waived for a 0.25% increase in interest rate. 

 

So you don't get the rates they publish without paying an exorbitant fee AND points, and then with the premium you'll pay on the rate due to them paying PMI on the back end,  it's probably not going to be an appealing mortgage option if your frame of reference is the low rates you keep reading about in the news.

 

 

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