Tharr62

Thread closed. Thanks everyone for the help!

rominl

iTrader: (4)

option 1 only works if you can figure out the word "how". if you can't find a way to reliability sustain that payment for years to come, it simply isn't an option

in my opinion, given your situation, leasing is not really a good option for you. it doesn't sound to me you are financially sound enough to lease. and with the negative equity you have now that's actually bothering you, i don't think it's a good idea for you to take on luxury cars either.

if i were you, i would just do option 2 and get myself into a cheap reliable used car (ie toyota corolla or so) and focus on paying off the personal loan as well as the corolla. build up more equity and asset first before i consider leasing and luxury cars again.

especially if you are conscious about saving money and also retirement, those should come first

wasjr

How about a modified option 3? IF you can negotiate a good deal on a new smaller car, and a good trade in price on your RX, then with your high credit score you may be able to roll at least some of the negative equity into the car note with a repayment period of 60 or 72 months.

Trying to put a good face on this, your negative equity of $11,000 will go down with each payment. Maybe not the full $800 as the vehicle will depreciate as well, but a substantial amount.

Tharr62

Thanks for your feedback! Yeah, this maybe the best choice for sure. Regarding the "luxury" car.. it's something I have to maintain a "brand image" with my clients in my line of work. (the car is seen often) a Toyota may not be a good thing for me, and the impression I am trying to portray. This is the reason for the Lexus to start with. FWIW, I have owned other luxury cars over the years, BMW, ACURA, etc.. it's just this is the first time I have been upside down because of an issue I had with the last car.

All well,

You don't think getting a used 2006 Lexus is a good idea? At least then, people can look at me as someone who cares about quality, but thinks I just have had it a long time LOL.

Tharr62

I checked.. and at my credit union.. they have 4.3% for 84/mo. If I did that, it would drop down to apx. $676/mo (saves $130/mo).

Maybe I can run with that to get some breathing space.. and see how it goes in another year? Meanwhile, I am just keeping paying it all down right?

I don't know. Just the thought of walking into another dealership makes me sick.

Infra

iTrader: (1)

Truth is, you're only going to add on total cost by making pretty much any option to refinance. If you were planning to buyout in 2 years, I would assume you have some cash on hand as a seed for that, but perhaps not.

So think of it like this - are you really going to take $130/month over a newer, more reliable car that is still covered under warranty? Especially if you feel that the car you drive is important for earning client business? Are you writing off the cost of your lease to your business (since you consider it an important part of your business)?

I would recommend you take a look at your other expenses, and figure out how to save $130 a month. This is really not that much money for someone feeling OK taking out an $800/month car note. Many people's monthly TV bill is about this much. Perhaps take the opportunity to cut your cable and switch to streaming services? Eat out less each month? Defer some leisure travel?

Whatever you do, interest rates are expected to rise shortly, so I would recommend you decide quickly.

mmarshall

I don't necessarily agree with that line of reasoning. Trying to project an image can sometimes get people in trouble. There's nothing set in stone that says one has to drive something that bites off more each month than one can chew. Indeed, you may actually project a BETTER image to others by not trying to drive something that over-extends you....people will respect you for that.

Rominl and wasjr both seem to feel that the best option is a #2 or #3....and I agree. If your leasing company will allow it, find a buyer for your present car, pay off what you owe on it (even if it is a little more than what you get from the buyer), and then get yourself something like a Corolla or Civic that will be reliable and inexpensive. (if you have problems or trouble selling your present car to a private buyer, Car Max will buy it, though you might not get quite as much). And, in the future, if and when you can afford a Lexus, THEN get one.

96SC4

iTrader: (2)

option 2 should not even be considered.

upside down loan + cheap car payment for older car = aprox $500 a month.
Add repairs/maintenance to this older vehicle, and your easily in the $600+ a month range(if not more other months)

doesn't make any sense

Tharr62

Thanks so much for all the feed back. Def. a lot here to talk over with my wife (who thinks I should sit tight with what I have, and not do anything).. but.. it's me that sometimes worries about it and thinks its a mistake when some months money is really tight :-/

For sure! LOL. But, to be clear.. it's not that I could not afford the Lexus. LOL, the car I drive SHOULD be $465/mo at the most. In fact, my wife just got a full loaded ES for around $345/mo. Crazy. The issue, is don't bring baggage from one trunk to another! THAT was the huge mistake. I dumped a 2014 MDX 4 months in, because I could not stand it, and I had TONS of service issues. I was impatient, and made a horrible choice. Thankfully, the Lexus has been no issue at all, but oh.. the cost of paying for two cars at once is bad.

I also agree, and am smart enough to know that people "should" respect me for whatever I drive. and in 99% of the cases is not something that matters. But, in my line of work as a high profile branded photographer meeting with clients, and having them follow us out on locations, and going to some very upscale business, hotels, and venue in Miami.. getting out of a civic is not going to match up to what my brand stands for, and what I project, and what I demand for pricing. (this is another topic, and I could write the book on branding). Point is, in some cases it can make a difference, and while I agree the car does not need to be "new" it just has to mimic everything else about me, my personality, my branding, and the experience they would expect from what we do.

I'll be honest.. a larger part of me does not want to "give up" and do anything (and just listen to my wife). Keep the car, and just deal with it in other ways (kinda like someone said above, cut from other places to make the difference). Because it is a great car, and something that will last a long time it would be great to not have to deal with anything else. I would think tho, it would make sense to at least buy it from the lease ASAP to get lower payments? 84/mo? Then, of course I would continue to try and make the $800 (maybe even more sometimes) payments.. but, then if I have a "soft" month of bookings.. I can just do the min. Just a thought I guess.

Oh, how I have learned the hard way!

tex2670

Can you keep this up for 2 more years? What expenses can you cut to keep the payments going? Keeping in mind that, at the end of the lease term, you still need to keep making payments on the loan--how much will that be when you get it? This doesn't seem to solve your problem.


Why would you want to buy a 9 year old car to keep for a long time? Even though a Lexus is reliable, wear and tear items start to become more frequent when a car is that old. Why not find that $12,000 car in a newer Accord or Camry?


This probably minimizes your cash outlay.

Good luck.

Maikerusan

Listen to your wife in this instance. Option 2 --taking out an 11 grand loan to finance negative equity (and then have no car) and then go and finance a smaller or used car all over again? Don't do it.

Stick with what you have and just get through it.

PS-I have over 30 years dealing with personal lending/finances/commercial lending.

You admit you made a mistake..no one here is chastising you for that, and I am not either, but you just have to tough it out with the car payments on the Lexus , as is. You will get through it. Compounding your life with more loans, used cars and such is not the way to go, and not when your wife suggest you sit tight.

Good luck.

Tharr62

There it is. Thats what I am going to do. Nothing. :-) I'll figure out another way to make the payments, and get rid of the debt as fast as I can.

Thanks so much.

Thread closed!

mmarshall

Yes, that is what I meant.....not just avoiding any Lexus, but getting the right one for you at the right time.

LexBob2

It looks like you guys are paying about $14k per year in car payments right now for your RX and your wife's new ES. Is there anything your wife could do with the lease on her new ES350 to reduce the total monthly outlay at least until you get past this rough period? Probably not, just a thought.

tex2670

If you are worried about negative implications from clients seeing you drive a Camry, aren't you worried that your clients may see you serving coffee at Starbucks?