Thursday, September 4, 2014

Debt Breakdown Part II : Car Loan

not the actual car*
I first got my license when I was a senior in high school and my parents gave me a 1988 Honda Prelude. At the time, I thought they got it for me because I was their favorite daughter =) but come to realize that whole summer I became their errand girl. I wasn't really the kid that went out a lot - I was scared of getting pulled over, so I never drank and drove. My parents also paid for gas. I think their only caveat was for me to concentrate on school. I started Junior College at the time - my parents paid for school, books and gas (I remembered gas at 95c - the lowest me and my BFF found). I had the job at the retail store, but eventually quit after a couple of months.

not the actual car*

After two 1/2 years in a Junior College, I had to transfer into a University - about 35 miles from home. At this time the Honda was in bad shape (I cant even drive it on the freeway), I did not have much credit and my dad thought I was not responsible or probably did not have enough money to pay for a new car. So he gave me a 'deal' - I was going to take their 1999 Toyota Camry which had about a couple of months until its paid off. I thought "Ugh, I am driving an old people car!" - I wanted to be cool... I needed to be cool. After driving the "old people car" for almost 2 years. I begged my dad to co-sign a car loan with me. I gave him the most ridiculous reasons why I needed a new car ... there was a loud noise (break pads changed!), the car wouldn't start (battery changed!), the A/C wasn't working - well he told me to put up with it! But eventually, the car gave out (there was some kind of recall too from what I remembered).

not the actual car*
I told him I wanted a TRUCK, so they took me to a dealership. They co-signed a loan with me through their credit union (this is how I became a member), but they never told me how much the credit unions loan we got approved of (My parents never really talked about money with us). Toyota trucks were nixed off my list at first - they were expensive! I asked my dad if I can just get a Ford Ranger - but he had a preconceived idea that fords aren't reliable, I checked out and test drove a Nissan Frontier - my dad DID NOT like it (huh?). So we went back to the Toyota dealership and got me a 2005 Toyota Tacoma. Still at this point I did not have any idea what the total loan was - My dad asked me if I can afford the $450/mo payments and I said yes! I signed the loooooooong papers along with my parents - didn't even know how the negotiations went. Plus, I did not even get to drive the car off the lot - thanks dad!

Car loan $25,000* - Trade in Camry $4,000* = $21,000* + taxes $3,000*

First car loan while in college $24,000* with a part-time job as a server at a local restaurant. What a smart cookie!

What was your first car? How much was your first car loan?

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