Repairing an Old Car Isn’t Always a Smart Financial Move

[Soup]

Auto Loan Daily - Repairing an Old Car Isn’t Always a Smart Financial Move

Repairing an Old Car Isn’t Always a Smart Financial Move
By Ross Edwards
Wednesday, 11 February 2009 09:43


In an effort to pinch pennies, many consumers are keeping their old cars rather than buying new ones. Usually, this is a smart move, but eventually repairing an old car or truck just doesn’t make sense anymore and a new vehicle is the better financial choice.

“When faced with the decision of whether to invest in the repair of a current vehicle or purchase a newer one, motorists need to consider a number of factors," said John Nielsen, AAA’s director of Approved Auto Repair and Auto Buying.

Cost is the most important factor. A large repair like an engine or transmission could cost you thousands, according to AAA, and even small repairs like a starter or alternator often cost as much as a monthly car loan payment.

AAA says that when the cost of a repair approaches 50% of the value of a vehicle, it is time to start seriously considering a new car.

AAA also points out that many drivers just don’t want to repair an old car because at the end of the day, after you’ve poured thousands of dollars into it, it will still be old. Many people would just as soon trade in that clunker and take out a new car loan as repair it. All new cars come with warranties, so the cost of any repairs will be included in your car loan payment.

AAA warns that if you’re upside down on your current car loan, getting a new one might not be the best choice. Many finance companies won’t finance negative equity from a trade-in, and even if you find a lender who will, it isn’t a smart financial move. If you add negative equity from a previous car loan in while financing a new car, you’re almost guaranteed to be upside down on your new loan for a very long time.

Before you shell out thousands for a repair on your old car, consider whether that money might serve you better as a down payment on a new car loan.

[robz95xj]

FU(K AAA ive spent twice as much into my Jeeps then what there worth

[static]

^^ lol same with my merc

[Soup]

I've spent 5x what my Samurai's worth on it. of course, now I wish I hadn't, but I also wish I hadn't bought either of my new cars.

[01mmmz28]

hey soup, your boss tell you to post that BS ?

lol

that is crap advice.

[American Psycho]

values depreciate all the time. Service Shops still charge the same.

A vehicle is what you value it. Not what the "industry" says.


new car bought off the show room - Negative thousands already when titled.

Take my chances with the old.

[Inspector13]

Thats why I drive my daily beater till it dies then get a new daily beater. lol

[Traction Issuez]

Well why not just close all the small garages, cause if it is stupid to repair old cars then what will they work on,fuking morons.

[Soup]

Jesus shit you guys are taking this awful hard, all it says is that sometimes a POS costs as much to repair as a loan on a new car.

[fat_kid]

thats true of course, a car can be a money pit but just cause its used doesn't mean that it is

[Soup]

Until they build something that will compete with the LS1, people will be forced to repair old cars.

[JGT8229]

why spend 20k on a car thats a pos and quality is worse than it use to be. im not feelin body parts on cars that get dented by bird shit, or u can push in with your finger. ill take my money and buy a engine for a pos and make it beter than your new pos and it will be worth more in 10 years than your new pos, thats gona turn into a pos anyways . why not make new cars recycable investment stated

[01mmmz28]

^ they are, look at the prius, when it runs out of fuel/energy, just crumple it up and throw it away.

[JGT8229]

Originally Posted by 01mmmz28

^ they are, look at the prius, when it runs out of fuel/energy, just crumple it up and throw it away.

i ment reusable... ... if there goin to be ugly anyway hay why not

[01mmmz28]

I was reading some article where this hippie dude from San Fransisco built his own electric car and was bragging about the efficiency of it until he got his electric bill from pLugging it up several times per day at his house...lol...he said he went from a monthly bill of $500 all the way up to $ 750 per month....so, an extra $250 per month electric bill is being efficient? LOL