If I were to be considering buying a car . . . (Update)

[Jenny in Florida]

Update:

 

Since there has been some other car-buying chatter on the boards lately, I just thought I would let you know that the wheels are in motion (pun more or less intended) here.

 

I went twice to our local CarMax, where we've had good experiences buying cars before, and test drove a bunch of the cars I had been researching. The first trip I really considered just a fun afternoon out, rather than actual "shopping," since the whole concept of buying anything soon was still very much theoretical. I came home from that one convinced that the Chevy Spark was my choice and feeling pretty content to just wait until everything else fell into place now that I knew what I would be shopping for.

 

Then my son started getting antsy about waiting a lot longer to get a car for himself. He started looking at used cars online and pressing us to commit to an amount we would be willing to match and other details. Basically, it became clear that if I didn't start moving forward with buying something for myself so he could have my current car fairly soon, either I would miss my window or we would end up having the higher expense of helping him buy his AND putting a down payment on something for me.

 

We took a hard look at the credit report and verified that, as I had thought, the only way to significantly raise the score from this point forward is to wait for time to pass so that our ratio of on-time payments rises. Fearing the worst, my husband decided to go consult with the credit union to see what kind of loan (amount and interest rate) they would offer . . . and came back with better news than we expected. While the interest rate isn't as low as folks with good credit get, it's lower than we thought we would be offered. And we have been told that we may be good candidates for refinancing both this new loan and the loan on my husband's car (which was done through a different entity and carries a much higher rate) within a few months.

 

After searching online at CarMax and other sites for a week or so, I found a Spark in the trim I want with a manual transmission and very low miles. It is being transferred to my local CarMax so I can see it in person and decide whether to proceed. 

 

Now that we're moving forward with buying something for me, our son seems to have settled back into being okay with buying the Scion from us. I took it to our usual mechanic this morning for a thorough inspection, just so we can be as prepared as possible for any problems that might come up in the near future. There is the one issue I was already aware of, but I am thinking of putting off getting it fixed so that I can mentor my son through the process. (We'll either "discount" the price of the car to him so he has room in his budget or offer to cover the cost of repairs.) I want to make sure he's comfortable with taking a car in for service, and this would give me a chance to introduce him to the mechanic who has been taking car of the car and whom I like and trust.

 

Thank you all again for helping me get perspective on the big picture. I have to admit that I'm looking forward to not spending quite so much of my time being my son's chaffeur . . . and to driving a car with both A/C and a radio that work.

 

 

---------------------------------------------------------------------- Original Post -----------------------------------------------------------------------------

 

I've shared here before about the fact that we've been putting off having our 18-year-old son get his driver's license, primarily for financial reasons. However, now that he's working and going to school and with my own recent kind-of-a-promotion, we're revisiting the possibility. 

 

Just for background: I typically drive about 25,000 miles per year. My current car is a 2008 with just over 150,000 miles on it. We bought it used in 2011, and it's been paid off for a few years. The A/C is iffy, and the antenna broke off a few years ago in a way that makes it difficult and expensive to replace. I consider both of those things unworthy of paying to fix. I've recently put several hundred dollars into a variety of repairs, and I know that there are a couple more things looming that will cost $500 or more when they become critical. My best estimate, based on using a variety of online calculators, is that it would be worth no more than $2,000 as a trade in. (I have no interest in or patience for trying to sell it.)

 

We've kicked around a variety of options. One possibility is that we would match our son's investment up to a specified amount, so that he could go buy the used car of his choice. I would continue to drive my current car for another two years, hoping to baby it through until 200,000 miles, before buying a decent, new-to-me replacement. The other leading alternative is that we sell him my car for some percentage of the anticipated trade-in value and then I go buy my decent new-to-me replacement sooner instead of later.

 

One big issue is that our finances and credit rating are still in recovery mode following years of me not working. We have debt that I've been working really hard at getting under control now that I have an income again. Progress is being made. Buying a cheap car for our son would involve paying cash, not taking on a car payment. Waiting six months, one year, two years before buying something somewhat nicer for me would give us that much longer to pay down debt and improve our credit rating before taking on a car payment. On the other hand, we run the risk of my current car just conking out or encountering some kind of catastrophe at any point, meaning it's possible we could help our son buy his car and then still end up having to buy something for me sooner than we would like.

 

I am unable to think logically about this, because the truth is that I just really want a new (to me) car. I'm feeling both sorry for myself and deserving of some pampering. 

 

My son is no help, because he is in favor of the plan that gets him a car more quickly and less expensively.

 

My husband is no help, because he is reluctant to spend money but also 100% supportive of me doing what makes me happy. (He feels strongly that I "deserve" to have a car that is nicer than what our teenaged some would be driving.)

 

So, I'm starting to cautiously browse for car options.

 

I like small vehicles. My current car is a Scion xB, and I'd like something more compact, since I no longer spend all my time hauling teens and their friends around town. However, I prefer to sit up a little higher than some very small cars allow. (My husband has a MINI, for example, and I don't like climbing in and out of it or feeling like I can't see over/around anything else on the road.) I strongly prefer driving a manual transmission. I would like whatever I purchase to have fewer than 30,000 miles on it, and I want to keep the purchase price under $12,000. From a purely frivolous point of view, I'd just as soon buy something reasonably cute and fun.

 

I haven't allowed myself to test drive anything, being too afraid I'd fall in love with something and lose what perspective I have left about buying now vs. delaying. However, I'm eyeing the Kia Soul, Nissan Versa Note, VW Beetle and Chevy Spark, all of which can be had in my price range.

 

All of that said, I guess there are two questions:

1. If we begin with the presumption that, one way or the other, my son will be acquiring a car within the next few months, does the Hive think it is better/more appropriate/more reasonable to have me keep my current car and split the cost of a cheap used car for him or for him to buy my current car while I buy myself a still used but nicer vehicle?
2. If we do decide to go ahead with buying a car for me, does anyone have reviews of any of the models I mentioned or suggestions for other vehicles I should be considering?

 

Potentially of interest:

 

My son has another two and one-half years of college, which he plans to to complete locally. He hopes to move out of our house late this summer, sharing an apartment close to campus with his girlfriend. They both have income and, although it will require some careful budgeting, this is not an unrealistic or unreasonable plan. They will definitely need a vehicle to make it work. Their long-term plan is to move to New York a year or two after graduation, and they will not be taking a car with them when they leave town. (Yes, four years is a long time for a relationship between young people to last. They may not make it. However, the graduate-then-move-to-NYC plan is what my son intends to do, even if he's single by that point.)

 

Of the two of us, I am handier than my husband when it comes to upkeep and minor repairs. I put in oil, replace bulbs, etc. However, neither of us is capable of or interested in doing any serious DIY vehicle maintenance. Any significant problems that come up with my current car will mean paying someone to do the work.

 

Edited November 4, 2016 by Jenny in Florida

[cjzimmer1]

In your shoes,  I would:

 

First I would talk to a bank (well actually I use a credit union) and ask about getting a loan.  I'd want to know what interest rate they would be offering me (typically it's based on the model year of the vehicle but from you description I'm guessing you are looking at something in the 2014-2015 range) , especially since your credit rating sounds like it's not great.  They may not offer you their "published" rate and I'd want to know that upfront so I could determine my true costs.  Then with that in hand, what would be the monthly payments on 12,000.  Can you afford that?  Is it a stretch?  If you can afford it while still at least whittling on your other debt, then yes I would go ahead and purchase a new to you car and sell yours to your son.  If it was a stretch, I would probably still look for a newer car and sell to son but I would probably look for something say under 10K. 

 

If the payments are uncomfortably high or you would have to stop paying on other debt all together than, unfortunately I would say you have to keep your car (but I wouldn't be helping son to buy one either at that point because you to be working on your own situation so you will be able to afford a better car in the nearish future.).

[regentrude]

I would buy a newer vehicle for you and pass the old car that still runs down to your son.

 

if you prefer manual (which we do), your choice of car will be extremely limited by that, because there are very few makes and models available with manual now. If that is an important feature, I would first see what is available locally and then choose. There aren't many around. I love my Mazda 3 and our Honda Accord (family car; we would not buy such a large car again with the kids at college)

[magnificent_baby]

Although it may be difficult to charge your son, I would sell him your car for the blue book value, as long as it's safe to drive (I think you mentioned he would be getting off work very early in the am). 

 

My kids aren't that age yet, but I know in a few years we should be in the position to hand them over our used vehicle when it's time. I'm going to try to stay strong and sell it to DD if she wishes, as DH and I both always purchased our own vehicles and insurance when we were teens. I think that's a life lesson that goes a long way. 

[TrixieB]

I would buy a newer vehicle for you and pass the old car that still runs down to your son.

 

if you prefer manual (which we do), your choice of car will be extremely limited by that, because there are very few makes and models available with manual now. If that is an important feature, I would first see what is available locally and then choose. There aren't many around. I love my Mazda 3 and our Honda Accord (family car; we would not buy such a large car again with the kids at college)

 

ITA, manual is harder to find now.  We looked at manual vs automatic when looking for a car few years back. The manual was slightly less expensive but (surprisingly to me) it was rated lower for fuel economy.  Mazda 3, good choice!

[Arctic Bunny]

We have a Versa Note and love it. The "guys" used to poke fun at DH.... until they need to carpool somewhere. There is a ton of leg room, and I have fit $335 of Costco in there with two kids, a dog, and two suitcases.

[Jenny in Florida]

In your shoes,  I would:

 

First I would talk to a bank (well actually I use a credit union) and ask about getting a loan.  I'd want to know what interest rate they would be offering me (typically it's based on the model year of the vehicle but from you description I'm guessing you are looking at something in the 2014-2015 range) , especially since your credit rating sounds like it's not great.  They may not offer you their "published" rate and I'd want to know that upfront so I could determine my true costs.  Then with that in hand, what would be the monthly payments on 12,000.  Can you afford that?  Is it a stretch?  If you can afford it while still at least whittling on your other debt, then yes I would go ahead and purchase a new to you car and sell yours to your son.  If it was a stretch, I would probably still look for a newer car and sell to son but I would probably look for something say under 10K. 

 

If the payments are uncomfortably high or you would have to stop paying on other debt all together than, unfortunately I would say you have to keep your car (but I wouldn't be helping son to buy one either at that point because you to be working on your own situation so you will be able to afford a better car in the nearish future.).

 

I've already done that research. Our credit rating isn't good, and we won't get a great interest rate. I've run calculators on various sites to get an idea of what the payments would be. We would feel the addition of the payments and would not be able to continue chipping away at debt at the same rate I've managed over the last year, but we could still be making (slow) progress. 

 

The advantage to waiting, if it were possible, is that we could potentially save up more towards a larger down payment. And that would be an advantage, of course. 

 

What I'm realizing is that, even if I stall buying a car for me for six months or a year, our credit rating is unlikely to budge siginificantly. I've already paid everything current and knocked off the derogatory stuff it was possible to resolve and gotten our utilization ratio down to a good level. The most significant negative we have now is the percentage of late payments, which will take years to improve enough to make any visible difference. So, while we definitely need to continue working on this, I don't think things on that front will change enough in the time I have available before this car likely gives up the ghost for real to have much impact on the deal we're likely to get.

 

I should probably say, too, that $12,000 is the upper end of what I'm willing to pay. I've seen a few cars selling for less that would meet my criteria, and I'd be perfectly content to go with one of those if one is available when I'm ready to buy.

[AK_Mom4]

I just went thru this.

 

We opted for the "new to me" car and to let DS20 drive my old beater free of charge until he finishes college ( he is also going locally). We went to our credit union and set up the loan details, then went shopping for a vehicle for me. We found a small truck (seats 5) for a good enough price that we could afford to put a canopy on the back so my dogs and skis can be comfortable. It's a 2014 with under 10K miles, so it's practically new.

 

We could have done cheaper and maybe helped DS buy his own car, but I wanted something nicer for me (for a change!) and he is happy enough with my old car. He plans to buy something newer when he graduates and is out on his own with a job.

[gardenmom5]

I had to convince dh we get him a car, and the kids could drive his old one.  It never even occurred to him - and he wanted to look at kid cars. no dear - we buy YOU a car.  1dd drove it until she bought her own.  2dd drove it until she graduated from grad school  (hey - free car), 1ds actually totaled it (which prompted 2dd to exclaim "you mean all I had to do was wreck it?")  and we bought him a decent used** car upon which he is making payments.

 

** for a heck of a deal.  the seller's mechanic told him it needed $1200 worth of work (and he didn't get a second opinion) - so he lowered the price.  dh drove it, it seemed fine, so he was willing to risk it.  had our mechanic check it out, and that it just needed it's major mileage point service.   (and the part the previous mechanic said needed to be replaced? . . . . ? that car doesn't even have it.)

 

 

My friend's fil has a business where he can buy used cars wholesale . . . (or whatever they call it.)   what he buys depends upon what is available.  he'll provide grandkids with cars (if they actually need one as opposed to want one.).  might be a minivan if that's what comes up . . . if they're desperate enough, they'll drive it.  might take a few months for them to overcome their pride and decide dependable transportation is worth more than their ego.

[gardenmom5]

I would buy a newer vehicle for you and pass the old car that still runs down to your son.

 

if you prefer manual (which we do), your choice of car will be extremely limited by that, because there are very few makes and models available with manual now. If that is an important feature, I would first see what is available locally and then choose. There aren't many around. I love my Mazda 3 and our Honda Accord (family car; we would not buy such a large car again with the kids at college)

 

well - a true manual that requires a clutch it pretty hard to find.  usually only the uber base model.   OR higher end cars are coming out with a 'manual option', but there's no clutch. it's more automatic with complete choice of gears.  (the loaded suv I'm considering has it.)   not nearly as fun to drive -but you do have more control than with a standard automatic.

 

dudeling may be my only kid who doesn't learn to drive on one . . . I may have to look to find one when the time is right.  killing the engine is such a good experience for novice drivers . . . slows them down a lot.

[catz]

I would offer to "sell" your car to your son for a song that works for your budget.  If he's not interested, then he could use some of the money he's saved up to buy a car.  I would then start car shopping for you.  I think it's silly to think too hard about what kind of car he would "like" when there are serious practical and financial issues at play.  And it's a relatively short term investment if he is seriously going to NYC after college. I would definitely not be setting him up to be driving a nicer car than you.  You are really doing so much to launch him well, I wouldn't feel bad about that at all.  And I think it's great you're moving in that direction given the driving you're currently doing for him.  I think it's great too he has an alternative housing plan for next year.  

 

I think by having him be taking on buying a car he's taking on some adult responsibility and skill.  And I also think it's a huge gift and example to our adult children to get our own finances well in order before we hit retirement years.  Having elderly parents struggling financially is so difficult. 

Edited October 2, 2016 by WoolySocks

[displace]

I just wanted to make sure you've factored DS's insurance into the mix, which financially may upset the costs you've figured out. If I were under a financial strain, I would try to keep the car as long as possible. Idk if 6-12 months will help your credit score or not, but taking on a smaller loan would be good, if your car doesn't lose more value in that time. But if the logistics of DS having no vehicle during that time makes your life difficult, I'd probably speed up the process.

[Jenny in Florida]

Thanks, everyone.

 

I will admit to being surprised; I really figured that, in this crowd, I'd get lectured about financial responsibility, rather than encouraged to go do what I really want to do, anywway.

 

 

[klmama]

I just wanted to make sure you've factored DS's insurance into the mix, which financially may upset the costs you've figured out. 

 

The best insurance price for your ds's car is likely to come from keeping it in your name and on your insurance, with your ds as primary driver, instead of selling or giving it to him and having him insure it himself. 

[shawthorne44]

There is a third option.   Start shopping for an extremely reliable car now in the 4-5K range.  Put out the word that you are in the market.   

 

I recently bought an old Cadillac with 85K on it.   Man, I love that car!   I bought it from a friend of my parents.  I got it for a steal because her plan B was to donate the car.  She didn't want to deal with taking it to a dealership and selling it, since she didn't need another car.  She didn't want to sell it herself and have thieves scope out her house.  The only reason I got the car was that my parents asked their friends if they knew anyone selling an older reliable car.  

[mamakelly]

The best insurance price for your ds's car is likely to come from keeping it in your name and on your insurance, with your ds as primary driver, instead of selling or giving it to him and having him insure it himself.

Actually, we found that the best price was having the teen driver having his own car, in his name. If you have 3 cars and 3 drivers they figure the teen is driving one full time anyway. Definitely check insurance rates, insuring teen boys is very expensive.

[gardenmom5]

Actually, we found that the best price was having the teen driver having his own car, in his name. If you have 3 cars and 3 drivers they figure the teen is driving one full time anyway. Definitely check insurance rates, insuring teen boys is very expensive.

 

that could also vary with your insurance carrier and where you live.

 

for us in the PNW - it has been cheaper to keep cars in our name.

 

and sil allowed her license to lapse - her son had his name on his title, and paid his own insurance.  *HIS* insurance went up while he was living with her because she didn't have a valid license.

 

[gardenmom5]

There is a third option.   Start shopping for an extremely reliable car now in the 4-5K range.  Put out the word that you are in the market.   

 

I recently bought an old Cadillac with 85K on it.   Man, I love that car!   I bought it from a friend of my parents.  I got it for a steal because her plan B was to donate the car.  She didn't want to deal with taking it to a dealership and selling it, since she didn't need another car.  She didn't want to sell it herself and have thieves scope out her house.  The only reason I got the car was that my parents asked their friends if they knew anyone selling an older reliable car.  

 

we did something similar for 2ds.  friends moved to a rural area that gets lots of snow so they needed to also change the car. we happened to get first in line for it  (there were others who wanted it if we didn't buy it)  - it was her car, very well maintained.  they could easily have sold it for more on the open market.

[klmama]

Actually, we found that the best price was having the teen driver having his own car, in his name. If you have 3 cars and 3 drivers they figure the teen is driving one full time anyway. Definitely check insurance rates, insuring teen boys is very expensive.

 

Really?  What company do you use?  We looked at doing that, and it would have cost our dc over $1000 more to insure it than it cost us to keep the car on our policy.  I'm wondering if maybe we get a discount on the car insurance through dh's work, and dc wouldn't get that. 

[kroe1]

Two smart rules of life passed on to me by my grandmother who was the wisest woman who ever lived:

 

1. Pay 10% to the Lord and 10% to yourself (savings). Everything else will work out.

2. Never let your husband or your children drive a nicer car than yours.

[QueenCat]

That's a hard one..... we don't sell cars to our kids, we give them to them. It's just something we do, as does pretty much everyone in our extended family. If I had to sell it, I'd sell it for the least amount possible to help out the kid. Probably for whatever he's already saved for it.

[Jenny in Florida]

Updated in first post . . .

[Miss Mousie]

Nice update!  Feels so good to have a plan in place, I know.  I hope the Spark turns out to be just right for you!