[abeautifullife]

Hi, I'm seeking advice on my car situation. My husband and I just got on the DR plan and are religiously cutting expenses and snowballing our debt. We're starting to see progress already. But we have a car on its very last legs and will need to buy a new one soon, within the next month is likely. We can't share one car because, for the time being, we are working in different states and are only together on the weekends. I teach, and so I will be back over the summer and can loan him my car then if his car lasts that long. But then I'm restricted in terms of summer employment to walking distance (not in an area with mass transit) and my car is no spring chicken. If my car goes, then we're facing the prospect of replacing two, since I'll need to take mine back to my job in August. That would be an enormous strain on us.

We need functional cars to work, and aren't planning on picking up something fancy, but a new car ($3 - 5K would be our max, hopefully less) will still mean some new debt. We have our $1K, though - should we try to find a real beater for that or perhaps spend a bit more on something that might last us a few years? We're both at the beginning of our careers and our cash flow has just recently improved a lot, but who knows in this economy how long that will last. What would you do? TIA!

 

[Spirit Deer]

I know what I'd do, but that's not the popular answer.

I'd buy a decent car. Wouldn't have to be new or even pretty, but it darn well would have to be reliable. It sounds like you spend a lot of your time alone at home, and to me it makes no sense to have a car that's likely to break down when there's no one at home you can call to pick you up or help deal with the break-downs, plus repairs can add up fast. Beaters are okay if you're not having to deal with things alone, you live and drive in a safe area, you have another vehicle for back-up, etc. Not if the car needs to be as reliable as possible.

From what you've said, I think you've more or less reached the same conclusion. Assuming you can handle the payments, you're most likely going to have to incur that debt and just keep working hard to get things paid off.

We've gone through periods of having unreliable cars and it was always such a relief to get a decent one again.

We've also had to replace two cars within a month of each other and it wasn't fun. Our truck blew the engine due to an auto parts place selling us the wrong part for a minor repair, and then shortly after our car was T-boned when some moron ran a red light and hit us. Huge expenses lumped together, not fun. So for that reason as well, I'd be looking for a reliable car before the second one has to be replaced too.

 

[frugalwarrior2]

I would be sure i couldn't fix the old car cheaply.
So I it really can't last I would.
-join a CC union and get a cheap loan. One that I could pay more than the payment w/o penalty. Even cheap car loans at the lot are interest first.
-I would buy a privately owned car that a friend w/ great knowledege checked out.
-I would buy neither a clunker or a fancy car just something reliable. I would bring cash. And bargain the heck out of it.

 

[abeautifullife]

Thank you for the prompt advice! You are both right that we need a reliable vehicle. We've both graduated/are graduating from school recently (husband within the last few years, me in May), and we've been in the student car mentality for so long that I hardly know how to get out of it anymore! But I am so, so tired of car repairs. To answer a few questions:

-His car is toast. A mechanic we trust told us to give up on it. Even in great condition, its Edmunds value is low. In its current condition, its value is not more than a few hundred bucks on a good day.

-I don't mind having one car that is questionable at the moment, but not both. We need to be able to trust at least one car on the highway. I take Amtrak whenever I can to travel distances, but his family is not on a train line.

So, to ask a truly uninformed question, how does one join a credit union? We just have a normal joint bank account. Our bank does offer auto loans, but only on vehicles, at the most, four years old. We're in the market for something older than that.

 

[Greebo]

I would be sure i couldn't fix the old car cheaply.

My thoughts exactly.

Be sure the existing car can't be kept going first.

 

[Greebo]

-His car is toast.

Exactly what's wrong with it?

A mechanic we trust told us to give up on it. Even in great condition, its Edmunds value is low. In its current condition, its value is not more than a few hundred bucks on a good day.

It's value is not the question. It's mechanical condition is.

 

[Greebo]

If you absolutely do determine that the car needs replacing, then you have a storm cloud coming. No car = emergency. Pause the baby steps and put ALL AVAILABLE FUNDS (ie: no dining out, no vacation, NO EXTRA debt repayment, just minimums) into saving up for the replacement car.

 

[frugalwarrior2]

Greebo-agreed except a small emergency fund.
You used to have to be part of a group ex-teachers,union. But many are open. Just find a few close ones and call around.(save miles on that car.lol) Find out all the rules. Most allow you to have $5. minimum savings balance and will sign you up for $500. overdraft protection. Your checking acct. has no minimum balance and you are allowed 4 ATM w/d free per month at any participating C.U.
BUT ask because they are all diff. and those are mines rules. In this state. I haven't banked for years and years-technically.
Mine offers online as well. The only things is CC rates are sometimes not as good. Make sure they are federally insured.

 

[Greebo]

Greebo-agreed except a small emergency fund.

Can you elaborate on this exception? I don't understand.

 

[frugalwarrior2]

I mean don't clean yourself out to nothing because one emergency doesn't guarantee nothing else happening in the same time frame.
We currently have a washer that went yesterday,a van that just came up w/ a AWD trouble light,a dog that had surgery because he blew his knee out and now needs the second one done,the old dogs legs just went to the point where we need that final appt. and i just paid 2 sets of tuition and will pay 2 sets of books.Even w/ careful planning the sinking funds can sink.

And I'm thinking w/ every new used car as much as you check it out,it is as is. And something comes up.

 

[Greebo]

Oh, agreed - don't use the BEF to pay for new (to you) car unless existing car up and dies while you're saving up for new (to you) car.

 

[Guest]

Also - check the rates for car loans before just randomly joining some credit union. Generally, CU's have better loan rates, but check and make sure before you go ahead and sign up. I know our CU is currently offering 2.9% on used cars back to 2006 or 2007, but make sure the CU you're thinking of offers the car loan you need.

 

[frugalwarrior2]

Telephus-lol what did I just say. Check because they are all diff.

 

[khaski]

If you decide to purchase 1 or 2 'new' used cars, it is WELL worth the $100-150 to have a mechanic check it out before purchasing it. That $100-150 is the difference between buying something with confidence, knowing it shouldn't need major repairs for a while, or buying a nightmare you just have to keep throwing $ at. don't save $ by skipping it and taking a friend- have a real, true mechanic look it over end to end- in their garage (where they can get it on a lift). $ well spent!

 

[frugalwarrior2]

Khaski-true. I offer to show them the results if they pay 1/2.
I did the same on the home inspection.

 

[craftypam]

We used to buy old cars; pay them off and drive them until they died. Too many things started going wrong with them soo we started buying newer cars; longer to pay off; but a whole lot less problems. To each his own, but this has been our experience over the last 36 years.

 

[abeautifullife]

Thanks again for the advice; this thread has been very informative. Off the top of my head, his car has a bad head gasket, it has no back struts or shocks (we ride looow), it needs an axle, it has a problem with the drive train, it has no functioning windows and no a/c. Its window seals are also bad, so it leaks water into the car, but that could be fixed with duct tape. Overall, it is a mechanical miracle that the car runs at all.

Plus it's an American-made car from the 90s and not a reliable model. It's got almost 200K on it. It's just reached the end of its natural life.

We're going to try to hold out as long as we can (unless its demise seems eminent) and will speak to a credit union this weekend. I'll keep following this thread for insight and update with any decisions that we make.

 

[NikoSan999]

I know what I'd do, but that's not the popular answer.

I'd buy a decent car. Wouldn't have to be new or even pretty, but it darn well would have to be reliable. It sounds like you spend a lot of your time alone at home, and to me it makes no sense to have a car that's likely to break down when there's no one at home you can call to pick you up or help deal with the break-downs, plus repairs can add up fast. Beaters are okay if you're not having to deal with things alone, you live and drive in a safe area, you have another vehicle for back-up, etc. Not if the car needs to be as reliable as possible.

From what you've said, I think you've more or less reached the same conclusion. Assuming you can handle the payments, you're most likely going to have to incur that debt and just keep working hard to get things paid off. Make the minimums on all the other payments while saving for the vehicle.

I have to second this. It's exactly what I thought before I even read SD's post.
Save every dime for as long as you can beforehand and like FF said have the vehicle checked out before buying.

 

[Happyfamily2000]

I second what Greebo says! This is storm cloud time if your assessment of your vehicle is honest and accurate.

While not Dave, Suze Orman or Clark Howard would not have a problem with a *small* loan. But I'd still save some cash to offset it, make a budget and STICK to it. It is too easy to say "well, it's only an extra $500 or $1000 or $1500 and it would be so much more reliable/safer"

But the Dave response would be what Greebo suggests.

And if the car is still running, it isn't toast, just yet. It's not toast until it reaches a nice golden brown.:sun:

 

[NikoSan999]

I second what Greebo says! This is storm cloud time if your assessment of your vehicle is honest and accurate.

While not Dave, Suze Orman or Clark Howard would not have a problem with a *small* loan. But I'd still save some cash to offset it, make a budget and STICK to it. It is too easy to say "well, it's only an extra $500 or $1000 or $1500 and it would be so much more reliable/safer"

But the Dave response would be what Greebo suggests.

And if the car is still running, it isn't toast, just yet. It's not toast until it reaches a nice golden brown.:sun:

They work in 2 different states. If one goes down one person doesn't work. One person doesn't work the whole shooting match could very well go down.

Even if they wait until the toast burns SOMEONE has to take off work to go car shopping immediately and unless they're going to do it all within one day without shopping around they're going to lose pay or time. Actually BOTH people lose pay because there's only ONE car to go car shopping with so in that case NO ONE goes to work.

Sometimes you have to think ahead.

Dave, Suze Orman or Clark Howard would not have a problem with a *small* loan.
But THEY aren't going without a car to go to work in another state and they aren't volunteering to pay that person without a cars portion of the bills.

Boils down to...Sometimes you got to do what you got to do... then take a deep breath, put your big peoples pants on, regroup and move on.