Phychy behind availing loans, esp car loans!

[culart]

First time i availed a Car loan, while i had an old Car. I got a brand new Honda when i was 26! the thought was to enjoy life a bit more, so a smooth drive proved to be good change for a bit!
Now going to 28, the difference now i feel (though paying off) is an addition of something hidden knocking brains, Have to pay Off with increased interests!

As i thought, could not make it habbit for long, as to pay off in regular basis. so finally concluding it was more sentimental! Having a thing of ur own though old is better than adding a knock! (in addition income got decreased in comparision when i availed)

Is that normal phychy, that before you avail something you think more optimistic, just to convenice urself?

[aurielle]

What? I don't know, something hidden phychy is knocking my brain!

[Joan.of.the.Arch]

Yes, I think it is very common for people to feel optimistic about their ability to pay off a car loan. Evidently, some people only think about how much per month they can afford to pay; they do not think of the total cost of the financed car. They may not think about how much more they ended up paying when they take a loan, as compared to what they would pay with cash upfront.

Culart, are you using a language translator program to put your posts into English?

[disneysteve]

some people only think about how much per month they can afford to pay; they do not think of the total cost of the financed car.

There is actually an ad running on the radio around here for an internet site that lets you search for cars by entering how much you want to pay per month, rather than how much you want to spend on the car. They tout it like it is a great thing, but I think it is a horrible idea.

I'll pass on responding to the OP because quite honestly I have no idea what is being said. Perhaps there is a translator program at fault there.

[kv968]

There is actually an ad running on the radio around here for an internet site that lets you search for cars by entering how much you want to pay per month, rather than how much you want to spend on the car. They tout it like it is a great thing, but I think it is a horrible idea.

I heard, what I believe is, the same ad. I think it's a horrible idea financially for people too but it's a great idea on the business aspect of it. A guy I work with just bought a car and after everyone got over the "ooh, ahh" factor of it I asked him, if he didn't mind, what he paid for it and all he could really tell me was what his monthly payment was and a ballpark figure of the purchase price. I then had to ask what his interest rate is and of course he didn't know. I'm not saying everyone is like that but I'm sure there's a lot of cars sold with just the "what's my monthly payment?" method.

[disneysteve]

I asked him, if he didn't mind, what he paid for it and all he could really tell me was what his monthly payment was

I then had to ask what his interest rate is and of course he didn't know

Isn't it sad how prevalent that is. Someone goes out and spends $20,000 or $30,000 and truly doesn't know how much he has spent.

I get so frustrated when I periodically flip through the auto section of the newspapers. Many of the dealer ads show a car and only list the monthly payment but not the purchase price. Usually, if you search with a magnifying glass, you can find it somewhere in the tiny print at the end.

Besides, the figure they are advertising probably only applies to people with stellar credit who qualify for the best rates. Anyone else would pay more.

[kv968]

Besides, the figure they are advertising probably only applies to people with stellar credit who qualify for the best rates. Anyone else would pay more.

Actually, most of the time, the HUGE, extra-low monthly payment price they display isn't even the payment price but the lease price. And that's after, of course, you give the downpayment

Now that we're on the subject, I saw a good one in the paper the other day. One dealer had some used cars for what seemed like decent monthly payments until you broke out the magnifying glass. Oh, those "decent" payments are for 84 months with $3995 down. A 7 year loan with money down on a USED car. Caveat emptor!

[disneysteve]

A 7 year loan with money down on a USED car. Caveat emptor!

Yes, that's the other question you should have asked that guy. How long is is loan? It is easy to get low payments when you stretch them out for 6 or 7 years.

[kv968]

Yes, that's the other question you should have asked that guy. How long is is loan? It is easy to get low payments when you stretch them out for 6 or 7 years.

That one he knew, 5 years.

[Snoopy2645]

I know at different times in my life I have wanted a new car $200 a month dont seem so bad compared to driving my van with 130k miles on it then I see they want 20k or more & I just cant bring myself to that. My car then dont look so bad LOL

I have never had a car payment either I have always owned my cars out right & the thought of missing a payment if I had one is too spooky I wouldnt risk it I couldnt be without a car ever so I will not take that risk.

[simpleyme]

I hang my head in shame ,on our first new car they asked what we could afford a month and we told them and they crept it up by 10 dollar increments until we finally said no, years later we realized all we did was raise the price of the car!stupid stupid as the length of payments never changed only the payment went up . stupid stupid

lesson learned tho we never financed another car again

[project15]

When I was buying my used car, they showed me their "calculator" program and asked how much I was aiming for per month. I told them and they lowered the total price to get it to that. I then looked at the total price and said "I was really trying to get to $XXXXX amount of dollars rather than basing it on a monthly payment." So the dealership was good enough to get it close to my price and I bought the car.