Cash Vs Bank

vrewald14

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Let’s talk depreciation.

Let’s say I buy a tricked out Badlands and it ends up being $50k our the door.

What would you think the market value is on it in one year? How much has the value dropped?

assume less than 10k miles in year 1 and completely stock.





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Weld3z

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Let’s talk depreciation.

Let’s say I buy a tricked out Badlands and it ends up being $50k our the door.

What would you think the market value is on it in one year? How much has the value dropped?
No body can give correct answer because it's a brand new, but lets compare it with Jeep, Wrangler hold it's value so for 50K you may lose $8-12 K
 

vrewald14

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No body can give correct answer because it's a brand new, but lets compare it with Jeep, Wrangler hold it's value so for 50K you may lose $8-12 K
that’s as fair of an analysis as I can ask for!
 

Major_Bullsteak

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Oh and something to think about also is depreciation your car will loose about 30 % of it's value on the first year to me it mean that my cash payment also lost the value . weird way of thinking I know but my 50k cash payment is only worth 35 now! Same thing with loan but I still have the money in the bank.
To each their own. Everybody is in different circumstance and different stage of life.

The way I look at it, with a loan, you won't have the full $50K in the bank as you would have to subtract whatever the car payment is from that total. After 12 months and the car is only worth $35K, it's water under the bridge for those that pay cash. For those with loans, they are still making car payments just like it was brand new and still worth $50k when it now is only worth $35K.
 

TXBronco

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Any one here thinking to pay by credit card ?
Here in my country miles and points are very strong market, some peoples prefer to pay using credit cards !!
If not the full amount 10 or 20 %
Ya know, I was wondering about some of your questions until this post. If you can afford to buy a Bronco and have it exported to UAE, then money obviously isn't an issue for you and it would seem like your trying to figure out the best way to make your money work for you. In that case, I would suggest you ask local importers how they do it. I say this because here in the U.S, I'm sure the auto market is MUCH different. I'm sure I could come up with a few examples but I'm too lazy (hahaha American stereotype 🤣)
As for me, if you have cash, use it. ( Unless you have the kind of liquidity to have it make you money in the market.....)
However, I'm fairly young. Two kids in daycare (costs more than my mortgage every month, not kidding) and don't have the cash so I'll be financing. I'll shoot for 0% but I don't see that happening in the first few years. I'm a 2022 buyer. By then 1 of the kids will be out of daycare and will more than cover my payments. And my kick ass credit score with my wife's crazy good credit (well north of 800) hopefully will get me a damn good rate on the loan. That combined with a solid 2 years of saving, I should do well with a 45k Bronco (gotta limit myself lol)
Neither myself or my wife have ever owned a new vehicle. This will be my first, and VERY likely my last. Just not a good investment to buy new for me in 99% of circumstances.
 

mostly harmless

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I see that many want to pay in full cash, I am not a dealer but I know that most dealer make the money on the commission for the financing so paying might not get you the best price at the dealer ...

You can always apply for the finance and pay in full after ... Closing before terms without penalty.
This is basically my plan... Take the dealer financing (assuming there is no prepayment penalty) as leverage to negotiate a higher value on my trade-in, use x-plan pricing, then pay off the loan immediately with cash.
 

Mke_80

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Let’s talk depreciation.

Let’s say I buy a tricked out Badlands and it ends up being $50k our the door.

What would you think the market value is on it in one year? How much has the value dropped?

assume less than 10k miles in year 1 and completely stock.

You will end up loosing around 20-30%, unless it's a FE serial 1 and you know someone that really really wants it. The first C8 was sold at millions in a Barrett auction. But the coo told yahoo finance that this will be a mainstream car, they probably wont keep value like a 4runner per example. You have pretty good deal on F-150 used it's the downside of being the most sold model in USA. The more unit on the market the more you can expect to loose value.

This and the price war that will occur for sure with Jeep. Ford wont offer employee pricing on the first year for the Bronco but 2022 2023 you can expect a 3 to 5 k reduction in price just to fight the Jeep market.
 

irv0735

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There are many different philosophies so I won't argue with anyone on what is right or wrong. Also, people are in all different types of situations, so what might be right for one person may not be for another.

Ideally, you are able to afford the purchase in full. That doesn't mean you have to pay in full at purchase if you are responsible and don't over leverage by using the same reserves to justify multiple purchases, etc.

Take full advantage of low interest rates to keep your money working for you. If you will need credit later in your life, it's always a good idea to improve your credit worthiness to lenders (generally, that means credit score). So, if you do not have the ability to pay cash for your future homes or future business start-up costs, etc. then you need to consider your credit and having different types of credit on your report aid in that endeavour. Installment loans are one category to have a history with.

So... I plan to finance as much as possible as long as the rate is at or below 3%. While it's not guaranteed that my cash will earn more than 3% annually, the risk is acceptable for me with the potential upside. If interest rates are higher (very unlikely) then I would reconsider the amount financed. I'm fortunate to qualify for the best rates possible, so I'm sure I'll be financing the Bronco in full.

Just my .02
 
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Weld3z

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Ya know, I was wondering about some of your questions until this post. If you can afford to buy a Bronco and have it exported to UAE, then money obviously isn't an issue for you and it would seem like your trying to figure out the best way to make your money work for you. In that case, I would suggest you ask local importers how they do it. I say this because here in the U.S, I'm sure the auto market is MUCH different. I'm sure I could come up with a few examples but I'm too lazy (hahaha American stereotype 🤣)
As for me, if you have cash, use it. ( Unless you have the kind of liquidity to have it make you money in the market.....)
However, I'm fairly young. Two kids in daycare (costs more than my mortgage every month, not kidding) and don't have the cash so I'll be financing. I'll shoot for 0% but I don't see that happening in the first few years. I'm a 2022 buyer. By then 1 of the kids will be out of daycare and will more than cover my payments. And my kick ass credit score with my wife's crazy good credit (well north of 800) hopefully will get me a damn good rate on the loan. That combined with a solid 2 years of saving, I should do well with a 45k Bronco (gotta limit myself lol)
Neither myself or my wife have ever owned a new vehicle. This will be my first, and VERY likely my last. Just not a good investment to buy new for me in 99% of circumstances.
Hello ..
For new cars it's almost the same with price difference ..we have dealers for every brand .. in some cases people export used cars because it's a lot cheaper or not available or classic

It's not about money issue or not it's about how you plan to pay for the Bronco!!


Insurance is totally different here ..
It's 13 month contract, 3rd party is very cheap its like $300
For full covering it depends on car value and year but still cheap compared to other countries !

Good luck ..
 

DrewBronc21

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The car depreciates the same whether you pay cash or finance.

finance as much as possible if interest rates are low. Keep your cash. Put it where it makes more than the interest rate on the loan which should be easy.

higher payments on the loan are no problem because you have the cash.

emergency? you have the cash

you‘re not upside down on the loan. You have the cash.
 

BobN

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I currently have a 2020 Colorado ZR2 Bison diesel and it is a really fun truck to drive. However, I have always wanted a Bronco since I was very young. When I was a brand new 1 striper in the USAF (many, many years ago), I went down to the Ford dealer to buy a new Bronco. To my horror, the new ones were giant half trucks and not the Bronco I was searching for. So I moved on. But now the modernized version of what I want is available. That's great! However, I don't like to purchase first-year models and since I just bought a 2020 Bison, I would typically not be in the market mood for 3 - 3.5 years. Now I've had this Bison since August 2019 so that means 2 - 2.5 years to go. LOL. Cash vs. Loan? I prefer to keep my money invested and working for me in most cases. However, if I can hold out and not pull the trigger until Dec 2024 (would that be a 2025 model year?), I should come into a windfall and be able to pay cash for it and that would be a nice feeling.

However, you get one, as Malcolm said, "nature will find a way."

IMG_20200501_171927.jpg
 

MCG DAWG

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My money will be in the market where it will make me significantly more than the interest rate I'll be paying for my loan.

I won't have a trade and I will likely do 100% financing. Over the life of the loan my cash will make me more money in the market than the loan will cost me in interest.
 

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