At 7 years, you're probably going to end upside-down when you go to buy your next vehicle as well. If I were in your shoes (and as a fellow math geek, I will be very soon when I return to school), I would back off and wait until I could get an interest rate below 5%. Do the numbers, waiting is worth it.

d

 

Congrats on your new purchase......As for the rates thats not bad and I work for a Auto Finance co.....the only companies giving better rates than 6.49 for 84 mos is Credit Unions....and its different with the customer, bank, and location......CONGRATS this is one payment you wont hate paying.....

 

congrats, but that is awful high for a GSR. i paid 28,000 for mine. but whatever floats your boat man.

 

Congrats. If there's no pre-payment penalty on your loan, pay as much as you can on a monthly basis. Good call on the gap coverage. Good luck!

 

He baught a Mitsubishi GTS thats how..lol

 

I'll let the insult pass provided that you explain your reasoning precisely. And if you are unable to do so, I'd invite anyone else to explain to me why I'd be getting screwed. Before you respond, please read my other posts so that you get the whole story.

 

Word on that, rolling negative equity into next car is just plain BAD, it's a bad cycle that'll just keep coming around.

As far as the deal you made, 38k for 84 months with the rate of 6.49%, the payment would come about 564.09 per month (through an online calculator), and plus the GAP insurance that'll come to about what you are paying. So the dealership isn't trying to screw you over on the financing of the car, but paying 38K for the Evo... Well as long as you are happy I guess it's alright.

 

congrats on the upgrade

 

What do you spend your money on mathgeek? (hobby wise)

 

Im stuck on this part. If you dont intend to use the performance aspect of the Evo, why did you get it? A Lancer would have suited you just as well and you could have spent half of what you did.

 

me, 0$ down 4% for 60months invoice price tag april of 03.

 

Im amazed at the fact they have pushed loans to 84 months!!!! 72 months is crazy enough to think about.. let alone 84!!!!!!!!!!! Who even keeps a car that long if your younger??? I'm 26 and have in the past 4 years gone through a 99 eclipse which I fully built, a 2004 350Z and now my evo... i think im chillen on this one for awhile tho.. got a house now and would rather not lose my *** on cars anymore.

Congrats on the car... just try to pay as much off as you can so your not in the hole worse than you are now... you'll love the car.. but if your not gonna drive it.. you may never know what lies beneath the seat of your pants! Follow up with us after youve had the car a few months and see if you ever hit over 6500 rpm lol

 

Wow. I pay 3.90% on 27,9xx for my 03 Evo for 60 months and that's $513 a month. You sure you got invoice??? From Edmunds.com

2005 Mitsu Evo VIII GSR
National Base Price $28,928
SSL (Invoice) $ 2,727
Destination charge $ 575
Invoice Total $32,230

38K + 5K=43K for Evo, minus 7K loss on trade = 36,xxx

That means you paid 11% tax on your Evo??? I don't know what sales tax on cars is in CA, but 11% is kinda hard to believe. ($32,230 x 1.11=36,xxx)

Mathematically, I'd say unless you make more than $60,000 a year net profit AFTER HOUSING, that you're in over your head. This assumes a moderate lifestyle in already expensive California and not subsiding on ramen noodles and water. I'm also curious as to what your insurance costs are and how old you are. Personally I think any term over 60 months is just lining the pockets of banks with interest payments.

My recommendation to you would be to throw EVERY spare cent you have at the end of the month to principal reduction. Check with your lienholder, some banks will let you send in another "payment" from the payment booklet and apply it to the principal, others will require you to send a check to a different address and note it "principal reduction". Either way, try and build your credit and refinance at a lower APR as soon as humanly possible.

Investment wise the only thing that will probably beat a 6.5% after tax rate of return is moderately aggressive stock trading with really good timing or real estate (esp in CA). If you can't do either of the preceeding exceptionally well, stick to reducing that principal on your loan and getting a better APR.

Mathematically there's no "Proof" that my advice would yeild anything as concrete as a formula, but take it from someone who used to be broke, and is also reasonably adept at mathematics.

 

I spend any free time I have with my wife and kids. Reading history is a passion of mine (that's pretty inexpensive). I don't really have a hobby, per se, that requires a lot of time or money. I'm a boring guy.

 

Well when you get sick of the car 4 years from now and want something new....go wrap it around a tree and get it all paid off with your GAP. I'd rather pay 15 a month more for insurance than be that far upsidedown on a car loan....ouch!