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    Thread: TFL: Will be re-fi'ng home loan, is it a good time to go car shopping also?

    1. Member
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      03-09-2020 11:07 PM #1
      I've owned my home for about a year now, and with the rates dropping, my folks and I (They co-signed and helped big time with the down payment, because California) are most likely going to re-finance the loan that we have (no more than $300K). At the same time, I've been in my Corolla XRS for 11 years and its time to get something new, and IMO, something more enthusiastic than a silver appliance. I might consider leasing as well, since I can write it off as part of my job, but I do drive a lot more now. Was considering used too, but I'm very particular in what I'm wanting. TIA.

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    3. Planters (fasciitis) peanuts. Dang dogg Sold Over Sticker's Avatar
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      03-10-2020 12:16 AM #2
      We’ll see what happens in a month. When sales die off and OEM’s have a high day supply of ground stock then incentives start pouring out, and dealers trip over their dicks to liquidate bloated inventories.
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    4. Senior Member AZGolf's Avatar
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      03-10-2020 12:49 AM #3
      I would say both are a good idea. These might be the lowest loan rates for a long time - certainly the cheapest mortgages I've seen since the housing meltdown a decade ago. I just read an article about how flight bookings were down something like 7% the last week of February and 13% the first week of March, but airplanes are long regarded as one of the places you're most likely to get sick in the first place. Buying a car doesn't lead to getting sick and generally this isn't a good time to buy because so many people use their tax refunds for down payments on a new car, thus dealers have little reason to offer great deals on current model year cars that won't be replaced for another half a year at the earliest.

      This year however it might be different. It's really seemingly been just in the last week that certain things are way down - cruises, flights, restaurants, theaters, and anyplace else where you have huge groups of people all clumped together closely. Again, buying a car doesn't fit that model and if anything, people might be using money saved from not going on vacation to buy cars instead. It's too early to tell, but if the question was more about loans and rates and less about getting every last dollar of price drops, then yeah, this is probably as good a time as any to replace your 11 year old car.

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      03-10-2020 10:21 AM #4
      Buy a Model 3. They'll deliver to your house Coronavirus free if you dont touch it for a while. Just fist bump the truck driver with gloves on.
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      03-10-2020 10:27 AM #5
      Quote Originally Posted by Sold Over Sticker View Post
      We’ll see what happens in a month. When sales die off and OEM’s have a high day supply of ground stock then incentives start pouring out, and dealers trip over their dicks to liquidate bloated inventories.
      ^So much this.

      That said, on the one hand, you don't want to take equity out on your home, especially only a year into it. Also, I'd be surprised if there is any equity to take out when you do refinance. However, depending on your initial rate, you should wind up with a nice drop in monthly payments which will give you some added flexibility in taking on the cost of a new vehicle.

      I'd let the re-fi finalize, then assess your situation, my guess is this summer May-July will be a very good time to buy because the dealers will be playing catch up. The only thing that would prevent this, in my opinion, is if supply chains are bogged down enough to actually prevent the build up of stock at dealers. If we get to that point however, there will be much larger problems and car shopping likely won't be much of a concern.
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      03-10-2020 12:53 PM #6
      Quote Originally Posted by Sold Over Sticker View Post
      We’ll see what happens in a month. When sales die off and OEM’s have a high day supply of ground stock then incentives start pouring out, and dealers trip over their dicks to liquidate bloated inventories.
      Yeah, waiting might also be what I'm doing (which is what I've been doing). I know I can walk into a Toyota dealer and get offered a Camry for cheap.
      Quote Originally Posted by AZGolf View Post
      I would say both are a good idea. These might be the lowest loan rates for a long time - certainly the cheapest mortgages I've seen since the housing meltdown a decade ago. I just read an article about how flight bookings were down something like 7% the last week of February and 13% the first week of March, but airplanes are long regarded as one of the places you're most likely to get sick in the first place. Buying a car doesn't lead to getting sick and generally this isn't a good time to buy because so many people use their tax refunds for down payments on a new car, thus dealers have little reason to offer great deals on current model year cars that won't be replaced for another half a year at the earliest.

      This year however it might be different. It's really seemingly been just in the last week that certain things are way down - cruises, flights, restaurants, theaters, and anyplace else where you have huge groups of people all clumped together closely. Again, buying a car doesn't fit that model and if anything, people might be using money saved from not going on vacation to buy cars instead. It's too early to tell, but if the question was more about loans and rates and less about getting every last dollar of price drops, then yeah, this is probably as good a time as any to replace your 11 year old car.
      With this virus, I wonder if things like used car prices go down as well too.
      Quote Originally Posted by Tommietank View Post
      Buy a Model 3. They'll deliver to your house Coronavirus free if you dont touch it for a while. Just fist bump the truck driver with gloves on.
      Quote Originally Posted by GLI Dan View Post
      ^So much this.

      That said, on the one hand, you don't want to take equity out on your home, especially only a year into it. Also, I'd be surprised if there is any equity to take out when you do refinance. However, depending on your initial rate, you should wind up with a nice drop inpayments which will give you some added flexibility in taking on the cost of a new vehicle.

      I'd let the re-fi finalize, then assess your situation, my guess is this summer May-July will be a very good time to buy because the dealers will be playing catch up. The only thing that would prevent this, in my opinion, is if supply chains are bogged down enough to actually prevent the build up of stock at dealers. If we get to that point however, there will be much larger problems and car shopping likely won't be much of a concern.
      An M3 is more than what I'm willing to spend now on a car, actually your post about that real cheap Ioniq lease got me interested in perhaps finding something comparable. I wanted one too but that deal was already gone, but being in CA, I think the terms were different than on the east coast. Again, waiting would also be a good thing to see what other deals come out. I'm following those GLI manual deals now.

      WIth that said, I emailed Carmax to transfer this vehicle to me (After seeing it months ago, and I can transfer it for free now):

      https://www.carmax.com/car/18308128

      Price IMO is on the high side, but it is what I've been looking for
      Last edited by got-rice; 03-10-2020 at 12:56 PM.

    8. Member Itgb's Avatar
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      03-10-2020 01:02 PM #7
      Quote Originally Posted by got-rice View Post
      At the same time, I've been in my Corolla XRS for 11 years and its time to get something new, and IMO, something more enthusiastic than a silver appliance.
      You say you want to get something more enthusiastic than a silver appliance... and are interested in a silver appliance.
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      03-10-2020 01:07 PM #8
      Quote Originally Posted by GLI Dan View Post
      ^So much this.

      That said, on the one hand, you don't want to take equity out on your home, especially only a year into it. Also, I'd be surprised if there is any equity to take out when you do refinance. However, depending on your initial rate, you should wind up with a nice drop in monthly payments which will give you some added flexibility in taking on the cost of a new vehicle.
      Sounds like he has some equity since his parents helped him big time with a down payment. That being said, I wouldn't squander that equity on a car since it could evaporate if house prices decline. Instead, refi to another 30 and see if the difference in your payments would cover a car loan.

    10. 03-10-2020 01:20 PM #9
      If you really want a GLI, you can probably get a new 2019 for ~ $2,500 more than the Elantra. I checked prices at a local dealership in Northern VA by me. You could try one of the buying programs - Truecar, AAA, Costco, local credit union - and see what type of deal you could swing.

      Good luck.

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      03-10-2020 01:25 PM #10
      Refi the house first. As far as banks are concerned your house payment is much less of a factor when financing a car, than your car payment when buying a house.

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      03-10-2020 01:30 PM #11
      Quote Originally Posted by Tommietank View Post
      Buy a Model 3. They'll deliver to your house Coronavirus free if you dont touch it for a while. Just fist bump the truck driver with gloves on.
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      03-10-2020 01:30 PM #12
      Quote Originally Posted by jtprettyman View Post
      Refi the house first. As far as banks are concerned your house payment is much less of a factor when financing a car, than your car payment when buying a house.
      This.
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      03-10-2020 01:45 PM #13
      Quote Originally Posted by jtprettyman View Post
      Refi the house first. As far as banks are concerned your house payment is much less of a factor when financing a car, than your car payment when buying a house.
      100% this.

      Don't make any credit changes before the refi is fully signed, submitted, and closed. You can very easily screw your approval or rate by financing something right now. If you're not sure, ask your mortgage broker/lending officer.

      Once the house is taken care of, and your payments are lower (please don't pull out any equity after one year), go lease something nice and fun for "business use" .

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      03-10-2020 02:50 PM #14
      Quote Originally Posted by Pnuu View Post
      Don't make any credit changes before the refi is fully signed, submitted, and closed. You can very easily screw your approval or rate by financing something right now.
      Yep. Do not take on any new debt between the 2 credit checks. (Application/Closing)
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      03-10-2020 03:06 PM #15
      Not knowing all of the details, I'd say refi first (definitely refi first before spending on anything else, and avoid credit hits outside of the refi itself). Once the refi is done, keep the XRS, and get a fun weekend car for cash (a nice NC Miata can be had for under $10K).

      Go another year, see how things pan out, and get whatever car makes sense then. No need to rush now, unless there's a specific car you want and you find it ideal to get it right now.

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      03-10-2020 03:15 PM #16
      Quote Originally Posted by Sold Over Sticker View Post
      We’ll see what happens in a month. When sales die off and OEM’s have a high day supply of ground stock then incentives start pouring out, and dealers trip over their dicks to liquidate bloated inventories.
      What this guy said.
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      03-10-2020 03:17 PM #17
      Are you thinking about cashing out equity on the house to buy the car? If so I'd advise against it, sure the interest rate is low, but you'll be paying for the car for 15 years after the car is dead! If not refi first then lease second. I'm not sure if US tax law is anything like in Canada but in Canada if you can write off vehicle expenses leasing gives you way more bang for your buck.

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      03-10-2020 04:26 PM #18
      Quote Originally Posted by stealthboost View Post
      If you really want a GLI, you can probably get a new 2019 for ~ $2,500 more than the Elantra. I checked prices at a local dealership in Northern VA by me. You could try one of the buying programs - Truecar, AAA, Costco, local credit union - and see what type of deal you could swing.

      Good luck.
      If I want to get a GLI, it would have to be an Autobahn because I gots to have a moonroof. I think 24-25K was the bottom of those.

      Quote Originally Posted by Itgb View Post
      You say you want to get something more enthusiastic than a silver appliance... and are interested in a silver appliance.
      I guess I can't get away from boring cars I honestly just want something with the modern infotainment (Carplay, Android Auto), but I need it more for a daily albeit a little more fun than the Corolla now.
      Quote Originally Posted by VT1.8T View Post
      Sounds like he has some equity since his parents helped him big time with a down payment. That being said, I wouldn't squander that equity on a car since it could evaporate if house prices decline. Instead, refi to another 30 and see if the difference in your payments would cover a car loan.
      Since the house didn't appreciate that much, I doubt using any equity would be my best move.
      Quote Originally Posted by jtprettyman View Post
      Refi the house first. As far as banks are concerned your house payment is much less of a factor when financing a car, than your car payment when buying a house.
      Oh definitely, re-fi first. House > car. At least my house has a pool.
      Quote Originally Posted by Surf Green View Post
      Yep. Do not take on any new debt between the 2 credit checks. (Application/Closing)
      good point.
      Quote Originally Posted by vwpiloto View Post
      Not knowing all of the details, I'd say refi first (definitely refi first before spending on anything else, and avoid credit hits outside of the refi itself). Once the refi is done, keep the XRS, and get a fun weekend car for cash (a nice NC Miata can be had for under $10K).

      Go another year, see how things pan out, and get whatever car makes sense then. No need to rush now, unless there's a specific car you want and you find it ideal to get it right now.
      Actually, the Corolla is 12 years old (Its an 09, but got it in 2008 when they first came out from my old job at Toyota). The Elantra Sport that I found is exactly what I should've bought 2-3 years ago. The facelifted one is ugly, and it's not available in 6 speed anymore. Perhaps the Elantra GT N Line or Kia Forte GT would be better to buy...there's a lot of choices out there for sure.
      Quote Originally Posted by KrisA View Post
      Are you thinking about cashing out equity on the house to buy the car? If so I'd advise against it, sure the interest rate is low, but you'll be paying for the car for 15 years after the car is dead! If not refi first then lease second. I'm not sure if US tax law is anything like in Canada but in Canada if you can write off vehicle expenses leasing gives you way more bang for your buck.
      Definitely not using any equity. I might honestly be able to just pay cash, but I don't really want to do that though I'm sure I can afford a loan for principal amount no more than $20Kish. I don't want to lease any fake rich cars right now either, and would prefer to get a better daily first before any Miata or fun project beaters.

    20. 06-30-2020 04:17 AM #19
      So what was your final choice? I'm in the middle of the road now, too... head's exploding

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