new (different?)car or wait

[maxiesmom]

Ok, I'm looking to all you financial gurus for some advice. 3 years ago I took out a 5 year loan on a Chevy Cavalier 4 door car. Because I can get a GM discount thru a family member I qualified for 0% financing. My payments are only $217 a month. My problem is that the car is too small! I though as it had 4 doors it would work. An adult cannot sit in the backseat unless they want their knees in the back of the front seat. Not comfy! Plus I often tote my sister's 3 kids around. The oldest can sit in the front, but his knees hit the dash in order for his sister to not be squished. I would like a little bigger car, but don't want a huge payment. Would it be better to wait and pay this car off, or get a new one now? I don't want to pay 2 more years, then run out and get a new car and a new payment. Our should I pay this one off andtry to save money for a down payment? Would that just be a waste of 2 years payments? Please advise. Thanks!

 

[maxiesmom]

Anyone???

 

[WDWorBUST]

Well....I have a Ford Escort (about the same size) and it has worked great for us. I think the question you have to ask yourself is this. How often do you have anyone in the backseat?? And when you do how far of trips is it? Now that I have DD we use our Jeep for family trips out and about....but we drive the Escort to work and back (50 miles roundtrip) - the gas mileage is great (almost 30 mpg and the little thing is 9 years old) and although it doesn't ride as comfortably as the Jeep it works just fine....and we give a ride home to a friend who can't drive right now once to twice a week and I'm the one in the backseat (about 5'5") So with the 0% (which you have to love - that's what we have on our Jeep) and the low payment I would really consider the above questions. So I guess I didn't really answer your question - because I wouldn't pick either of the options you gave. I would drive it until it was paid for and then at least a year or two beyond that. But if it really doesn't meet your needs I would at least look into what the value of the vehicle is versus your payoff - etc. If you aren't going to lose money - and you would have a decent down payment on something else I would consider it - but most likely go with a "used" new car. That's my $0.02 for exactly what it's worth

 

[disneysteve]

My problem is that the car is too small!

I would like a little bigger car, but don't want a huge payment. Would it be better to wait and pay this car off, or get a new one now?

I think you answered your own question with that first statement. Why keep a car that no longer serves your needs no matter how good a deal it might have been when you bought it.

The sooner you sell/trade your current vehicle, the more it is worth. If you wait 2 more years, that's 2 more years of depreciation. So I'd vote for selling it now and replacing it with a good quality used car that better meets your needs. Interest rates on used car loans are generally higher than on new cars, but the cars are much cheaper so it works out to your advantage.

I would not buy a NEW car as I don't believe in doing so. Cars lose a big percentage of their value in the first 2 years. Best to let someone else pay for that depreciation and buy something 2 or 3 years old with low mileage (less than 12K/year). There are tons of nice cars coming off of short leases. Dealers are flooded with those. And winter is generally a good time to deal as car sales are lower. Happy hunting.