# Introducing the 97 month car loan



## Sherlock (Apr 18, 2010)

Want a new car but you still owe more on your used one than it's worth? No problem, just roll your negative equity into a new 97 month loan! Who says you can't afford that new Bimmer?

http://autos.yahoo.com/news/introducing-the-97-month-car-loan-202203365.html


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## NorthKC (Apr 1, 2013)

The never-ending car loan...


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## Addy (Mar 12, 2010)

Unbelievable. This should be illegal, similar to the 50 year mortgages they outlawed a while back.


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## doctrine (Sep 30, 2011)

I could take out a line of credit to buy a car and never pay it off (an infinite year loan). I don't see much of a difference. People can make their own decisions. I knew people 10-15 years ago who had 7-8 year car loans. I didn't agree with them, but it's their own choice.


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## hystat (Jun 18, 2010)

I remember seeing 120 month terms at the boat show years ago. On cheap bowriders with carpet glued to plywood floors that would probably rot in 3 or 4 years. At least a car can get you to work.. haha


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## Four Pillars (Apr 5, 2009)

doctrine said:


> I could take out a line of credit to buy a car and never pay it off (an infinite year loan). I don't see much of a difference. People can make their own decisions. I knew people 10-15 years ago who had 7-8 year car loans. I didn't agree with them, but it's their own choice.


+1


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## sags (May 15, 2010)

I saw some ads for motorcycle trikes that offered 300 month payment plans............

Cars do last longer today.........so maybe it isn't so bad.

The average age of cars on the road is around 11 years and getting older every day.

It only makes sense for very low mileage drivers though.


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## jcgd (Oct 30, 2011)

sags said:


> Cars do last longer today.........so maybe it isn't so bad.


I'm confused...... . .... .... do you mean they last longer compared to the last decade, or compared to cars from the 60s, 70s, 80s? I ask because newer cars don't seem to last very long. Well, the sensors and such tend to go pretty quick.

But I supposed the quality today is better than the quality yesterday if you are referring to domestic vehicle before and after the bailouts.


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## Sherlock (Apr 18, 2010)

How long did cars used to last in the old days? I mean in the 70s, were lots of people driving cars from the 40s and 50s?


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## crazyjackcsa (Aug 8, 2010)

Sherlock said:


> How long did cars used to last in the old days? I mean in the 70s, were lots of people driving cars from the 40s and 50s?


Funny you should ask, I just dug out my 1971 Buick Riviera Warranty Card. 1-year, 12,000 mile warranty. That's it.

Cars do last a lot longer and you get a lot more trouble free miles out of them. But the cost to repair them has gone up considerably. Think fewer but more expensive and complicated problems.


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## jcgd (Oct 30, 2011)

I haven't been around very long so I can't really say. I just don't think cars last very long these days, but I've never had a car much older than 23 years. I've just seen a lot of older cars still kicking it old school. I suppose they are often collector cars though, and have been rebuilt.


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## sags (May 15, 2010)

jcgd said:


> I haven't been around very long so I can't really say. I just don't think cars last very long these days, but I've never had a car much older than 23 years. I've just seen a lot of older cars still kicking it old school. I suppose they are often collector cars though, and have been rebuilt.


The primary source of parts for old cars is drying up, as auto wreckers now strip off a few items and crush the rest of the car for scrap. They make more money from scrap steel prices and don't have their money tied up in "inventory" sitting in a yard being stripped one little piece at a time. They also don't need to have people hired to strip parts of the cars anymore. For insurance liability reasons, they can't have people wandering around their yards taking parts off themselves.

The other part of the equation regarding old vs new cars..............involves the cost of financing.

Many new cars are available at discounted financing.........0%, 2% etc..........while financing for an older car can be as high as 30%. 

Unless a person is paying cash........or using a low interest HELOC..........they may be paying less per month in payments for a new car than an older car.............and they would have a full warranty.

Like everything else it seems...........the full cost of something may be in the details.

With a good down payment and low interest rates, financing over a long period of time may make sense, especially if a person wants to own an expensive car that would otherwise be cost prohibitive.

This would especially be true for low mileage drivers buying sought after expensive cars that hold higher resale values.


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## newfoundlander61 (Feb 6, 2011)

Insane and stupid, cash only for a car. Used car that is.


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## 6811 (Jan 1, 2013)

sags said:


> The primary source of parts for old cars is drying up, as auto wreckers now strip off a few items and crush the rest of the car for scrap. They make more money from scrap steel prices and don't have their money tied up in "inventory" sitting in a yard being stripped one little piece at a time. They also don't need to have people hired to strip parts of the cars anymore. For insurance liability reasons, they can't have people wandering around their yards taking parts off themselves.


Not entirely correct Sags,

I just visited a wrecking yard (one of several in the Ottawa/Gatineau area) this week with my son who was looking for a replacement driver side car seat (and a few other odds and ends). To get into the yard you have to sign a liability waiver (and get the back of your hand stamped) but then you get to wander around and, using you own tools, strip off whatever you need. Prices are listed on big boards (like restaurant menus), I.E. Power Seats $24.95; Manual Seat $22.95. Seemed to be doing a booming business.


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## 72camaross (Apr 26, 2010)

97 month car loan.... holy #[email protected]!

That's ridiculous. It will end up driving used car prices up too high because everyone will still have a loan on the car that's no good any more.


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## praire_guy (Sep 8, 2011)

Used car prices ate already too high. 

"Buy a 2-3 year old car and drive it for 10 years". Ya, right. Try to buy a 2 year old civic. Better off buying new.


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## Rusty O'Toole (Feb 1, 2012)

2 or 3 years ago my brother went shopping for a used pickup truck. The ones he looked at, that were 2 to 4 years old, were beat up and the dealers wanted practically as much as for a new one (Like, $14000 vs $17000). By buying a new truck he got cheaper payments (0% interest vs. 5 or 6% at the credit union) plus a brand new truck with full warranty.

It was actually cheaper to buy new.

He knows enough to break in a vehicle carefully and maintain it by the book. It will probably be giving him good service after 10 to 20 years. When you buy a used vehicle you are taking a chance.

By the way I still buy cheap clunkers. When you only pay $500 to $1000 you can afford to be a little bit chancy.


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## andrewf (Mar 1, 2010)

When I was shopping for a car, I found that gently used cars 2-3 year old cars were not discounted enough to make sense rather than buying last year's model from the dealer, new. Even paying cash. The dealer incentives were pretty good at the time...


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## Four Pillars (Apr 5, 2009)

andrewf said:


> When I was shopping for a car, I found that gently used cars 2-3 year old cars were not discounted enough to make sense rather than buying last year's model from the dealer, new. Even paying cash. The dealer incentives were pretty good at the time...


+1

I have found this in the past as well. It seems like a lot of people say this is true, without actually doing the research.


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## hystat (Jun 18, 2010)

depends on the car. My last one was a year old with 38K. I paid 32% of MSRP.
If you want a Civic, Corolla or F150 4X4, there isn't much to be saved.


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## Barwelle (Feb 23, 2011)

andrewf said:


> When I was shopping for a car, I found that gently used cars 2-3 year old cars were not discounted enough to make sense rather than buying last year's model from the dealer, new. Even paying cash. The dealer incentives were pretty good at the time...


Were you shopping at dealers only for used? Or through places like kijiji etc? That would make a difference.

I found that you could count on about 20% higher prices at the dealer when I was looking for my car... although the cars I was looking at were 5-6 years old, not 2-3. Not very comparable.


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## andrewf (Mar 1, 2010)

I don't think it's worth buying private sale. Or at least, I did not want to risk it. I used dealer prices, assuming I could get 10% off sticker price.


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## LifeInsuranceCanada.com (Aug 20, 2012)

Four Pillars said:


> +1
> 
> I have found this in the past as well. It seems like a lot of people say this is true, without actually doing the research.


This 'two year old cars are cheaper' could potentially be changing. There's a lot of dealer incentives and low interest rates for new purchases, and I think cars are holding their value a lot more in the first couple of years compared to what they used to. A two year old car with 75K on it used to be on a downhill slide to the wrecker. Today many cars like that are just getting broken in. Aren't many of the small honda's and toyota's commonly running 2-300K? Still, it's likely dependent on the actual car. Pickups hold their value, for a long time. On the other hand, my wife's volvo we bought when it was 2-3 years old was way cheaper than buying new. As much as volvo's run forever, there's a way huge premium for buying them new.


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## NorthKC (Apr 1, 2013)

I have to agree there. When I was looking for another car last year, I was initially looking at 2-3 year old car. However, a lot of them had high mileage while prices were still high. So, for $2K more, I got a brand new car (dealer incentives) plus paid $1000 extra for another 5 year bumper-to-bumper warranty after 3 years and I still walked away with a way cheaper loan (0% vs 7%). Given that I'm driving the car to the ground say, in 20 years P), it was worth it and I know that there are no chances of a lemon car commonly associated with used cars. 1 year later, car is still in great shape!


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## Four Pillars (Apr 5, 2009)

Some good points that there could be big differences between different types/models of cars.


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