How to afford a new car
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- Опубликовано: 30 авг 2017
- Obsessing over price alone is a noob's mistake.
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Love seeing Brian Cooley in these segments, but I'm still hoping CNET On Cars full episodes will return!
Totally agree, we need him back
Who else laughed hard when he showed a Jaguar and talked about reliability
Joel W so glad someone else noticed this haha
Joel W bro... Jaguars are actually quite reliable these days. Especially that xj. Fuel economy will kill you fast though.
The new Jaguars are nothing like the past.
Jamaican Me Crazy Jaguar reliable? Get the hell outta here
@@josefgriveas7113 I own an xk and I just traded a 13 lexus gs350 for a jaguar XF and I have had no problems at all. In fact, the material quality and driving experience is much better than my lexus was (not knocking lexus btw). Today's jaguar is significantly better than its past reputation would lead people without any recent experience to believe. Fantastic cars imo.
Buying new is worth is if you keep the car until it dies. I buy my cars with the options and color I want. I don't worry about resale value!
If you want the most for you money, buy used! Let another sucker take the depreciation.
I looked at a few things. Why buy a 3-5 year old car for 18,000 when you can buy it new, with 0 miles and what you want for 22,000. Subaru is a great example. I dont see a point. Ill spend the extra $$ for 0 miles and what I want all day and every day. I got a 17 Mazda 3 for ~19,000. THey had a used 2013 with 30k miles and a few more features for $15,000. To me its a no brainer
emark24 That 2013 was way over priced. Last year I got a 2015 Mazda 3 with every feature (HUD, heated leather seats, blind spot monitoring) but adaptive cruise with only 13k miles for $18000. That's just over the price of a new base model.
Used vs New is a case by case basis but guess what, it's only gonna have "0 miles" on the day you buy it.
emark24 I agree tenfold. Growing up racing dirtbikes. We had gone through tons of bikes new and used and it's nice getting new for the fact that it's yours and you know some one didn't beat on it and abuse it.... If you stick to a certain type of car you can avoid most of the idiots. But most people don't know or care to do that. Used is nice but it's also nice to get a car that in perfect shape and hasn't been beat up.
I buy new vehicles and drive them until they don't work anymore.
I could listen to Cooley read the phone book.
adam Cooley needs to be cloned. He's too precious.
Ten years ago we had Steve Jobs, Bob Hope, and Johnny Cash. Now we have no jobs, no hope and no cash.
We Must Protect Brain Cooley and Kevin Bacon!
+ adam
.....Get a life.... SMH
You're so kind!
COOLEY COULD BEAT THE SHIT OUT OF ME AND ID TAKE IT.
IT WOULD BE AN HONOR TO GET ANNIHILATED BY SUCH A GREAT MAN
One thing you didn't cover was the mileage cap/extra fees on a lease. Many leases charge extra if you go over 10k miles a year. That's less than 850 miles a month.
you can pick your mileage per year .. I always pick 12k or 15k per year since I love to drive.
william31518 And you pay more for it.
yea, but extra $20 a month shouldn't be a big deal especially today we are talking about car payment not food prices.
I think the most I have driven in a month is maybe 500 with 80 miles of fluff
As someone living in the rural where everywhere I commute to is 30 minutes one way, I would never lease a car.
35k for a new and average car is frightening to me.
Alex F Yeah fortunately that's just average. Mine was far less than that.
Yep the 24k I paid with taxes and everything is plenty. Not loaded, but not hubcaps either.
I winced so hard at that kerb rash footage
Riswan Ahmad P. Me too I was like, No stop!
Riswan Ahmad P. Curb rash
JD Power ratings are misleading. Reliability is not properly represented and is muddied by things like ergonomics and consumer understanding of in car technology and other ratings
What Brian says as two methods of getting into a car (buying/leasing) is really him saying (financing/leasing).
What it really means to buy a car is to show up with cash on hand or with a check on hand. That's something everyone should strive to do, not borrow (finance) or rent (lease).
SuperHollowfied Agreed!
Well It kind of depends. I completely agree that people should stop looking at the "monthly payment" and actually care into how much to purchase, maintain, and the borrowing costs.
But on the other side of the coin, cars are always a depreciating asset, and they cost a lot of money. It may be a wiser choice to borrow at a low interest rate, and then invest the money rather than tying it up.
Disagree in making that a blanket statement. I can make 5% parking my money in a good (very safe) mix of equities/bonds, which means paying that 2% car loan is a better way to make my money go further for me in the long run. The key is to show up at the dealership with a blank check (up to the amount you're approved) from a bank you've already applied with beforehand so you know what you're getting yourself into.
It may be surprising to some, but even if uou have the cash, it might be better to finance if the money is cheap. Car loans can be quite cheap because they are secured by a reasonably easy to monetize asset. Indeed, you can get a better deal on a car loan than a hedge fund might get on a margin loan with a much better LTV. At the end of he day, car loans are often a very cheap source of leverage for an individual.
Isaac MacDonald Not only that but if it's your first one it could be that stepping stone you need to buy a house, if you're so inclined.
I built my credit with some plastic payment methods (cards) and that helped me get the first car loan, which helped me get the second more expensive truck loan, and those two auto loans skyrocketed my credit rating to where I could get the best mortgage rate available.
It's a progression where you prove you're able to handle more and more financial responsibility to get what you really want.
At least that's how I went from no score to a home in almost exactly 2 years.
The most important thing regarding Leasing is the Capitalization Cost (Cap Cost). The price you are agreeing to for the vehicle. This affects the monthly payment & how much is owed + sales tax if you decide to purchase the lease. The "down payment" reduces the Cap Cost. You have no control over the Money Factor or the Residual Value. That is set by the manufacture and can change throughout the year and is affected by the length of the lease term. You should ONLY put down all fees and the first months payment and lease for 24, 36, or 39 months. Be sure to include the number of miles you drive per year in the lease. DO NOT TURN IN A LEASE. Sell the lease to a dealer. Pocket the difference & avoid the 3rd party inspection.
Never buy new. Buy a 2-3 year old vehicle. Shop online for a manufacture extended warranty. Beware dealers will try to sell you a 3rd party extended warranty or a warranty that is only good at that dealership.
WHat do you mean DO NOT TURN IN A LEASE? How do you sell the lease to the dealer?
I agree with your advice on leasing, but not with you're advice on buying a 2-3 year old car. A few reasons:
With some cars having such high resale value, buying used isn't always wise because a new car might not be that much more expensive than the same car brand new.
A used cars will be out of warranty or just about. Buying a proper aftermarket warranty can be expensive and aftermarket warranties are often very sketchy. You might pay thousands with the belief you'll be covered, but then you go to get the car repaired and are denied on the warranty claim, leaving you with the repair bill and worthless warranty paperwork.
Financing for used vehicles can often be costlier. Even if you find a car for much less money and a proper warranty, the difference from new might be eaten up in used vehicle financing costs.
Besides all that, you're buying a used vehicle. When you buy used, you're buying some else's used machine, their headaches and abuse, you're having to drive around town to find a car that's in the best condition and, if you're wise, paying to have the car inspected, all rather than just pointing to the color you want out of the line of new cars all in perfect condition and in the same location.
From personal experience, buying used isn't always better, it can be tougher and costlier.
emdec55 - I agree with you. I've had more than a couple experiences where buying a 1 or 2 year old car is actually more expensive than the new counterpart. In general though if you drive an average amount finding that 2 year old car with an average amount of miles and that's been fairly well kept is quite possibly the sweet spot for car buying.
You lose about 10% of a new car's value just by driving it off the dealer's lot. You lose another 10% by driving it for the first year of its life. And it could be much worse. A BMW i3 loses about half its value in the first year of ownership. It pays to avoid such extreme depreciation.
dlwatib That is a gross generalization. Some cars lose 20% in the first year, others don't. But in the end, it doesn't really matter. If no one takes a depreciation hit, then there will be no depreciated used cars for anyone. It's silly to suggest one is better than the other. People should just buy what and can afford. Nothing is universally better than other.
Unless someone else is paying for it, leasing is the single most stupid thing a consumer can do.
Robert LeBlanc
If you want a new car every 2-3 years and don't care about all the extra money you spend in the long run, it's the smartest thing to do.
Jose Flores
Nope. It’s still worse than financing or buying outright.
@@crewboy23 Actually it's not stupid if you're someone who never wants to pay out of pocket to fix stuff, spend time off fixing stuff, or simply wants new on a regular basis.
Cars do continue to improve as the years go on. You're kinda stuck with what you bought for awhile to realize the cost without totally losing your shirt. A car you leased you simply turn in at the end and grab something new.
Leasing isn't for me but I can at least see the benefits.
For owners that want to change their luxury car every 2-3 years, leasing is the best idea.
The steep depreciation of such car combined with a higher finance interest (compared to leasing) will create more losses as you resale them.
It is a good option when it comes to high end cars or performance cars as they don't really hold up over time so you'll end up milking your wallet to fix it after 4 to 5 years of ownership. So in this case leasing is the better option atleast you know what you're gonna pay.
The biggest savings is not buying new car. Unlike houses, cars are depreciating assets. The greatest depreciation comes within the first 2-3 years.
I brought a 2011 Buick LaCrosse for $11k in 2014. MSRP was $36k. It has 20k miles on it, and carfax shows oil change every 3k miles. Previous owner paid $24k for 3 years of use, babied it, then I got remaining lifespan for less than half that much. The savings went into my down payment for 2nd house (2 family). Between rent from my first house (3 family, I live in one) and 2nd house (2 family) mortgage is more than covered, I live for free plus monthly stipend, and vacation money is piling up for the good life. For many people, not buying new car with ripoff depreciating rates is what makes the difference in their lives and gets the snowball rolling. My 2011 Buick is reliable, and ride quality is like driving on clouds. It sure beats getting a new Honda Civic for twice as much, suffer through the bumpy roads while having to still take part of my hard earned paychecks for mortgage.
Well done!
leasing or buying...either way you're losing money. The correct mindset is as soon as you spend that money, it's sunken cost so just enjoy it.
Bo Han Don't lease. They'll bend you over for enjoying it too much. 😂
You will lose money on buying a new car if you don't keep it for at least 9 years.
Buy new! Custom Order! Love it and maintain it for 15- 20 years!
I will never buy another new car without paying cash for it. Why didn't he say that was even an option?
Most people can't afford to pay cash for a car. If you can that's great but this video isn't for you.
@CBJO_752 lol how does that make any difference
I bought a 2006 Nissan Sentra brand new and 320k she’s still running like a champ. I’ve been trying to kill her for 2 years so I can get a new one and she still haunts me as of this day.
mitino aiken Haha did it finally die?
If you can't afford new buy used. They do make money on the car. JD power is an advertizing agency. Don't buy extended warrenties, buy a reliable car.
Another excellent informative piece! Thank you sir!!
cars are cheap. It's the insurance scam that forced people to buy is expensive.
I understand leasing is more expensive in the long run, but there is something to say about having a new car ever 3 or so years, lower monthly payments and not having to worry about big repair bills that older cars tend to get. Sound of mind that new cars have with their reliability and the emotional aspect of having a new vehicle with the latest tech.
I personally prefer to buy rather than lease. Leasing is like renting, it’s money you’ll never get back. When purchasing, even if you finance it for 6-8 years, all the money goes to you eventually owning it. And when you purchase, you can customize it and make it your own. You can customize a leased car, but you must revert everything back to stock when your lease is up.
Absolutely love that you did a video on this Roadshow/Cooley. There are so many people who don't understand the basics.
Brian Cooley is to motor vehicles what Morgan Freeman is to movie voices and voice overs.
Sigh....I tried.
Great advice! Thanks.
amazing info!
Very good information in this video
Unless you're loaded, please do not lease a car! Buy the car, and sell it back to a dealer or another person when you want to upgrade. Buying is a much better value!
I miss the good ole days of bargaining. I know we probably didn't get the deal we felt like we were getting but it did make you feel better thinking you haggled the dealer down a couple thousand bucks. These days I go to credit union, borrow the money and know how much I am willing to spend. I know what car I want, I know how much I'll take in trade in. Our vehicles are paid off so we don't get upside down. We don't waste our money on extended warranties or gimmicks.
Great information but I'm surprised you didn't speak on mileage. Isn't that one of the most important deciding factors when considering leasing? I put about 25k mi/yr on my car so leasing was definitely not an option for me.
Leasing is too expensive. You are limited to only about 36,000 miles for 3 years. If you like to drive a lot, buy it and own it. And if its paid for with cash you can get minimum coverage insurance on it and that will save you even more money every month
I would reccomend checking insurance rates first . Imagen buying a car that you cannot afford insurance for
I’m of course trying to buy a vehicle because I live out in the rural and drive like 30-40,000 miles per year.
You should have covered insurance because it is REQUIRED on all cars driven in the U.S.
If you get in an accident and the other guy cried neck pains, the insurance blocks you having to pay for anything across the road. Also helps to have a lawyer or two on hand.
Great video as always...can you please tell me more about 'resale values ' after leasing EVs ...I'm about to do it
If you have to ask, you shouldn't be leasing.
Damn, that old Ford commercial is from the dealership near me!
Leasing is more like fleecing
I would never lease a car because i want to always own my 🚗.
This is why I got a Honda Fit!
jggpj how is it, I’m thinking of getting one
In my country almost nobody buys with financing. You just pay the whole amount, or you lease the car..
Today the car marketers are pushing the lease option and as such, the car needn't be built to last like they used to be.
What's up with all the short clips? Is it for more ads? There used to be a full ~20min show. I'm gonna just keep waiting for that.
beg rich grandparents for money, get it, then feel like shit when your car is the only new one at school D:
What happens on lease return day when the dealer says your car is not worth the residual because of condition of body or tires.
You bend over.
zululeppard It's spelled in the lease agreement. Excess wear fee.
Mistake #1)Financing a new car.
Leasing
Financing or leasing a new car will keep you poor in paying interest charges and depreciation. Ask Dave Ramsey. Rich people don't fiance cars they buy it in cash.
foford I dunno I borrowed $10,000 for a car hauler @ 9.99% over 5 years and paid it off in 15 months.
My cars are only 3.44% and 2.88%. They'll be easier.
Might just carry them to term though since the total interest is basically nothing.
I'm paying over 6 years 0% interest
And you still owe more than it's worth.
@@IanEriccc Me? I'm dead even on KBB for both vehicles. I'm slightly underwater on my house though. It's still front loaded on interest since it's so recent.
This is why I use autogravity
That's me soon, my 05 crv is getting old, 320,000km starting to show its age. (198,000miles)
Graham Roth but is anything wrong with it or are you tired of it and want something new?
haha, part of me does want something new, just had my mechanic check over it while getting an oil change, and their isnt anything wrong with it, so I'm back to being happy with it
Graham Roth awesome, just think of what you could do with the money you save each month! Vacations, investing, etc.
residual values went out the window in 2021
I personally like to buy my cars. Leases mean u don't own anything.
The rules change when it comes to EVs. Conventional wisdom is that you always get the best value by buying used. But with EVs, that's not always true. That's because state and federal tax incentives can knock $10k off the price of a new EV, but not a used EV. Tax incentives come into play when leasing, too, because the tax incentives can be passed on to the lessee in the form of reduced lease payments, even if he didn't have enough tax liability to fully benefit from purchase of the same vehicle.
So if u lease it and u get in a serious wreck what do u do?
K-rex You call your insurance company. And 9-1-1.
Buy a car you want and drive it at least for 5 more years payment FREE!
Buy an good unpopular model. Take the savings up front. Expect deep discounts.
Brian, Can you do an episode on all the new versions related cars stuck at the port due to the feds overreacting to dieselgate?
Sale Tax!!!
You don't have to pay sale tax when you lease.
$50k vehicle that's $3,5k where I live!
Don't people keep cars for 15+ years anymore?
I'm going on 18. Runs just fine. Oh yeah...cuz it's a toyota.
Who da faq is buying a car over 73+ months?!
Who is buying a car through financing? If you can't pay for it outright, you shouldn't by one at all...
Sinbreaker that I have to disagree with...you either have a car payment or car maintenance costs...ill choose a payment any day of the week...why do I care to own something that is basically worthless after 100K miles
You've probably watch Dave Ramsey or any number of other videos about maintenance vs car payments. You already know maintenance will pretty much always be WAY, WAY cheaper than a car payment under any scenario. My car is 15 years old and the only major maintenance was a radiator and water pump. Most cars can make it easily to 150k - 200k with good maintenance. People just tell themselves it is cheaper to have a car payment that because they always want a new car, phone, computer, shoes, clothes, etc. Usually your old stuff works just fine.
The only points he makes are the obvious. I'm not a fan of his condescending attitude nor his advice....
I wouldn't say its cheaper as it is predictable. A used car with alot of mileage is a ticking time bomb. I rather have piece of mind over the unpredictability of an old car. I do agree its cheaper, but newer cars have better safety features, efficiently and creature comforts that I work hard for. As long as my payment is within my budget, thats my logic. So hey if that works for you, then that's cool with me :)
Sinbreaker Walking is cheaper. Not mowing your lawn is cheaper. Letting the paint peel off your house is cheaper. Not using deodorant and never replacing your ratty clothes is cheaper, but doing that will leave you'll looking and smelling like a bum. It's easy to save money and be cheap, just be a loser and don't spend money on things that unnecessary. But for most people living in the modern world, owning a car isn't just about getting from A-B or what's necessary, it also about keeping up with the societal standards. That might be important to you, but most of us like living in the advanced world.
👍
How do you email Cooley question
HIMI2003 Pray to Cooley with your question. He is God
I want a 50 year old muscle car... why am i here
work work work.........
hello boys! did you miss me?
You guys are nuts, new cars are simply a non-option, my parents never owned anything new and I never will. I love cars, have built them, studied them, obsess about them, but I could never afford to buy something new, ever. I guess I will just keep driving my 2002 Maxima, and continue saving money
Buying a new car is a terrible investment...unless you like cars. Also cars are becoming like phones - if you drive one that's 10 years old, the tech makes you feel like you're riding a dinosaur.
Do not lease cars. you lose money in the end.
Yay leasing teach them to be in debt and then lose the car
Normally I agree with everything this guy says but this is garbage advice. Buying a car is ALWAYS cheaper than leasing unless you're talking about really sporty cars you plan to beat up or cars that cost close to 3 figures or higher (which have a unique market of their own). Buy your car, keep it clean, and don't beat it up too hard, and sell it privately. If you do this, you most likely won't have cars breaking down or have many (if any) unexpected repair bills. Been doing this since the 90's and I've always gotten much more money for my cars than everyone else I know. And I get a new car every 4-5 years.
So is leasing a bad idea?
Freddy Medina Fuck yes
you sure do push leasing alot
Novated lease way to go
Without the how to it sounds a bit weird
Say NO to everything the finance guy says.
Rather own my car
Kingdrosive 3 Financing or Leasing is still not owning. You have to pay off the car before you can own it.
Chr Gav Ok..I would rather finance a car so one day I may own it instead of leasing a car where u return it within a year or 2..
Leasing is not a good advice
If you need an 84 month loan to buy a car, you can't afford the car.
Great buying/leasing tips Brian.
Leasing a car is fleecing your wallet
Best way for a man to afford a new car......win the lottery. Best way for a woman to afford a new car......find the guy, who just won the lottery.
This advice was not well organized, and I fear difficult to use in practice. Shouldn't the questions be: (1) what do I want/need in a vehicle, (2) how much can I afford (which may be a check on (1)), (3) having decided on what I want and can afford, what is the optimal financing arrangement in light of how long I want to keep the car?
tl;dw get an older car instead.
only clowns lease cars.
Only ignorant clowns think leasing is any worse than paying thousands to finance a depreciating asset and being financially crippled by it because you're underwater for years to come.
Pacheco That's why you pay cash. Leasing and financing are both dumb.
Ryan Lewis With that thinking, money is dumb. I'm sure you have no money though.
Pacheco Me not leasing or financing means I'm paying myself. Saving and investing with the money I'm not paying someone else. Your comment makes no sense.
No, your comment makes no sense. By definition, money is debt. It only has value when it has an obligation behind it. Seriously, where do think money comes from? It's just government printed paper, and the government is continuously devaluing it. So yeah, keep saving it. Saving only creates the misbelief that you're holding onto something you need. In reality, money only works when you give it to someone who demands. That's how your money works. That's how the modern world has been built. The world is built on debt, not on people paying themselves with paper.
Never buy a new car, bad investment. Look for a 3 years old car with less than 35k miles. Own it for 4 years and repeat the process.
Ben Tj i think you meant to say bad "purchase "
I had one of those. It sucked. Got rid of it after less than a year.
I'm back to two options: super cheap pulled from the weeds and fixed up or brand new.
I have bought two vehicles, (bought one still paying on newest vehicle), first lasted 12 years. I plan on driving the one I'm paying on now at least 12 years.
That's why I always lease instead of buying. When you pay 600 for a car I will pay 300. And every three years I will have a brand new car. All maintenances go on the dealership, and if the car explote I will have a new one. I'm leasing, not buying. Good luck to those who pay the double for owning a car, and when they finally own it after 5,6, or 7 years, the car will worth nothing 😎😎😎😎😎😎 So good luck to buyers giving their money away.
Hemi Passion you obviously haven’t done the real math 😂
I'm worried that my 66 Cadillac may not last another 50 years.
Jim Rr That's alright just lease the next '66 Caddy.
You think dealers will just lease you whatever and not be the one to win? If you think leasing is saving you money, dealerships will continue to take advantage of fools like you.
@@jgirtman012 if you stay under the mileage maximum and have no intention of ever NOT having a payment, leasing isn't too bad of an idea. Dealers win when you buy as well, so it's not as if you're sticking it to them or getting one over by purchasing.
These guys had me right up until the absolute end. Why... WHY the fuck is there soooo much obsession and emphasis with resale? What about an opinion or suggest to those select few of us who actually want to the car for as long as it'll go? This coming from a what you old folks at Roadshow call a "millennial".
People in The Matrix. Who would in their right mind buy an overpriced piece of junk. It devalues by thousands as soon as you pull it off the lot. Used gets you a great car at a much reduced price. 5 Grand gets you a real good car. High mileage that was maintained is your best bet because everything has been replaced.
Yes, that's usually what brokeass people say.
Doug Smith apperantly people would rather make $500 payments than fix a payed off car once in a blue moon. Brainwashed
A used minivan is your best bet off Craigs List etc. Nobody wants them. The wreckers are picking them up all day for $200 scrap value. Who wants to have it towed to see how much for inspection and etest. People in the Burbs need the room for the brand spanky new one. Older ones were better built. Third year on my 1998 $600 Sienna. Battery, plugs and wires, air filter 02 sensor, some exhaust work. Uses hardly any oil. A maintenance belt replacement for something at 350,000ks LOL
Yeah, who in their "right minds"? You know, living in a 3rd world country is also cheaper. Why waste money on electricity, toilet paper or running water that doesn't have cholera in it when you can save money by living in Somalia and marrying a goat. Perhaps you "right minds" should move there.
@K Zed 😂 🤣 🤣😂 🤣
How to afford a new car?
Lease it
Bullshit don’t lease
Leasing is a great way to make a bad decision.
lmaoo YES!!! UNLESS n you're going to choose a Mercedes/Jag then leasing is probably the best option LOL you get to keep that warranty and free maintenance instead of paying $800 at the dealership every time you go
And so is purchasing. If you don't know what you're doing, anything can become a bad decision.
emdec55 purchasing isn't always a bad decision though, in nearly all situations leasing is though. Buying too much car or spending more than you should is dumb no matter what.
You think that because you probably don't know much about leasing. Leasing can be the way to go, particularly with German cars or cars that are unreliable, have poor resale value and/or are being heavily discounted.
When calculating maintenance, repairs and resale, my last two German cars were cheaper to me because they were leased and the heavy discounts, which went to cap cost reduction, drove down the lease payments. My current BMW is worth way less than the residual in my lease contract. If I had purchased the car, even with 0% financing or just full cash, I would've lost thousands on it if I were to trade the car in or sell it. Thankfully, it is leased and residual isn't a concern for me. That's all BMW's problem.
Now with my trucks, considering the same things, it was much to cheaper to buy them, which is what I did. This is because the lease programs aren't nearly as good and because they are worth so much at the moment.
This all depends, you just have know what you're doing.
emdec55 Lease programs for BMWs are so aggressive, I actually wonder how they make money on them. You see kids paying $300 a month for 3 years and next to nothing at signing for a $40,000 car. At the end of the lease the cars might not even be worth 1/2 of what they were new... I don't understand how they do it, but that's all they seem to do at BMW.