Years financing a S650

[dmcg940]

Since a new S650 GT is going to sell north of $45K, how many years will it take for a 1st time young Mustang buyer to afford to finance this car, and will the car hold up that long?

Radio financial advisor Bruce Williams used to say if you can't afford to pay for the car in 36 months or less, you can't afford the car. That sounds harsh, and maybe that number ought to be 48 months now. But I wouldn't go over that (and 36 is better.) That may mean you can't afford a Mustang. If so, I'm sorry, but no one gets all the desires of their heart just when they want to have them. Save your money, get a bigger down payment together, get a better job (or an additional job) or decide that an S550 (instead of an S650) will do for now.

Life lesson: NO CAR is worth breaking your credit and putting yourself into financial misery. Buy and enjoy what you can afford. That's the secret of being content.

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[lcbrownz]

They are more designed for the impatient. The logic is "I can save for a down payment to get a 48/60 loan with manageable payments... orrrr I can get a 72/84 loan because I want the vehicle right now with payments in my range." These are usually the people that live *paycheck to paycheck" and as soon as they get freed up credit they see the need to utilize it. Unfortunately, most people don't look at long term financials anymore or are even taught it. Thus they never understand the longer your loan terms the more money you're throwing to the bank regardless of interest rate. We're raising a society of dependency unfortunately, but I'll stop before getting political.

What are manageable payments for a $45K Mustang GT on a 48/60 note? $955/48 -$789/60...with $5000 down. That's with an excellent credit score. That's too rich for my budget.

 

[Longitude Zero]

To avoid being upside down aka underwater, finance for the shortest possible time. 48 months is about the longest you can go with a 10%-15% down payment not be there from the start.

 

[Nanashii]

Good video from savagegeese on several topics including financing (towards the end).

 

[S650 GT]

Can someone from the USA explain to me how your car prizes work?

If I see you are talking about a car that costs 45k is this with or without tax?

Becaise if we speak about a 45k car in Europe, it is 45k, nothing less and nothing more.

But with US, I'm always confused.

 

[OppoLock]

Can someone from the USA explain to me how your car prizes work?

If I see you are talking about a car that costs 45k is this with or without tax?

Becaise if we speak about a 45k car in Europe, it is 45k, nothing less and nothing more.

But with US, I'm always confused.

Unlike the EU and UK that requires VAT to be included, ours is listed separately. In the US, car sales tax varies by state, from 0-8% with most states probably landing around 5-6%. So a 45k car is realistically 47-48k here.

To add further confusion, you can’t simply get a better tax rate by buying your car from a different state with lower/zero tax. Your tax is based on you register your car (ie where you live).

 

[Onewolf]

Unlike the EU and UK that requires VAT to be included, ours is listed separately. In the US, car sales tax varies by state, from 0-8% with most states probably landing around 5-6%. So a 45k car is realistically 47-48k here.

To add further confusion, you can’t simply get a better tax rate by buying your car from a different state with lower/zero tax. Your tax is based on you register your car (ie where you live).

Here in the US of A the most important $ number is the "out the door" price. This will include all the stupid dealer fees, registration/titling costs as well as sales taxes. Where I live in Tennessee the sales tax on vehicles is 7%.

Another thing is that some dealers are willing to discount significantly off MSRP, but others discount very little (or even include "market value" BS additions). I tried to negotiate a good deal here in the Knoxville area, but the dealers were not willing to play ball. At all. I ended up buying a '22 GT Premium from Ourisman Ford in Manassas Virginia for about 11% under MSRP.

I financed it using Ford Credit for 48 months @2.9% for $528/month. But I put $24K down so I shouldn't have to worry about being 'under water'.

 

[Evo1986]

Here in the US of A the most important $ number is the "out the door" price. This will include all the stupid dealer fees, registration/titling costs as well as sales taxes. Where I live in Tennessee the sales tax on vehicles is 7%.

Another thing is that some dealers are willing to discount significantly off MSRP, but others discount very little (or even include "market value" BS additions). I tried to negotiate a good deal here in the Knoxville area, but the dealers were not willing to play ball. At all. I ended up buying a '22 GT Premium from Ourisman Ford in Manassas Virginia for about 11% under MSRP.

I financed it using Ford Credit for 48 months @2.9% for $528/month. But I put $24K down so I shouldn't have to worry about being 'under water'.

You put 24K down? Wouldn't it make sense to buy the guy entirely or do you guys get the down payment back at the end of the finance term?

Here in Germany, once you do a down payment, your monthly rates go down, but the money is gone.

 

[Onewolf]

You put 24K down? Wouldn't it make sense to buy the guy entirely or do you guys get the down payment back at the end of the finance term?

Here in Germany, once you do a down payment, your monthly rates go down, but the money is gone.

Yes, but the cash isn't 'gone' it's sitting in the car.

Putting $24K down means I have that much more equity in the car such that I don't need to worry about being upside down if I decide to sell it or trade it in. Also, my monthly payment is $528/month rather than $934/month if I put only 10% down and I pay half as much in interest charges over the life of the loan.

I chose to get the Ford auto loan at 2.9% because I'm also building a house with a construction loan at 5.9% so I'm using the 'extra' cash to reduce the construction loan since it's a MUCH higher interest rate.

 

[Skye]

https://www.cnbc.com/2023/01/04/sha...thly-payments-over-1000-hits-record-high.html

I was taken aback by the idea of a $1000+ car payment.

 

[Q6543]

Yes, but the cash isn't 'gone' it's sitting in the car.

 

[shogun32]

Most average "new car" buyers only care about "what's it going to cost me per month and for how long " just to drive a new Mustang off the lot. None of that other stuff matters to young new buyers (21 and below).

their parents failed them. Any age person has no business buying a "toy" car if it means violating ages-old rules on debt loads. They are "ages-old" and "rules" for a damn good reason.

But I am looking forward to the rising tsunami of defaults and repossessions that is rapidly coming on-shore. Lenders will be desperate to secure ANY recoverable value and with no bids, the prices will crater and unwind the last 15+ years of insane valuations.

PS. I still won't be buying a S650 no matter how cheap it is.

 

[seanuf99]

their parents failed them. Any age person has no business buying a "toy" car if it means violating ages-old rules on debt loads. They are "ages-old" and "rules" for a damn good reason.

But I am looking forward to the rising tsunami of defaults and repossessions that is rapidly coming on-shore. Lenders will be desperate to secure ANY recoverable value and with no bids, the prices will crater and unwind the last 15+ years of insane valuations.

PS. I still won't be buying a S650 no matter how cheap it is.

Slight correction...Parents AND education system failed them.

 

[lcbrownz]

Twenty Percent Of New Car Loans Are Now For 84 Months. Nearly one in five car buyers by the end of Oct. 2022 had a seven-year loan to purchase a new car, and almost one in 10 used car buyers opted for a seven-year loan, according to Automotive News. How many of those 84-month loans are going to S650 buyers?

 

[Bikeman315]

Twenty Percent Of New Car Loans Are Now For 84 Months. Nearly one in five car buyers by the end of Oct. 2022 had a seven-year loan to purchase a new car, and almost one in 10 used car buyers opted for a seven-year loan, according to Automotive News. How many of those 84-month loans are going to S650 buyers?

Well none since the S650 is not available yet. But with the S550 probably not many. The Mustang is a low volume car to start with. Then add the fact that inventories were at an all time low. I also think the majority of Mustangs sold are not for primary use. These buyers most likely do not need to pay the high interest rate that comes with a 84 month loan.

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