Question about financing a new 3 coupe.

[geewize]

I currently own a 2001 325i sedan, I am looking at financing/ordering a brand new 2008 335i coupe, My question was basically I noticed that there is a 3.9% offer on bmwusa.com subject to credit approval. Now I have about 10 credit cards total credit line of 20k dollars roughly about and a 738 Credit score, should I cancel those credit cards before going for the loan or should I just do it as is.

I am looking to basically put nothing down because when it comes down to it I am going to be using the 4k of my car or so for Registration and the other 4k to pay off the rest of my 2001 (I am figuring about 7-8k for my car non-trade in).

What would be my best option I know I would be financing about 44k dollars.
My income is about 2k a month but I don't pay rent or any other bills so. I am questioning to do this.

[drz]

Your income is $2k a month? I say no stinking way.

To get the rate announced by BMW, your credit score might be good enough, although they may be looking for a 750 or 760. Canceling your credit cards will not help at all. In fact, most of the time, that can only hurt your credit.

As a rule of thumb, you shouldn't spend more than 8% of your gross monthly income on car payments. For you, that would be $160. Rules of thumb aside, lets look at the numbers. That rate is for a 36-month term at most. That would make your payments around $1400/mo, which represents 75% of your monthly income. Even if that $2k you mention is your monthly take-home after-tax money, that still only leaves $600 for gas, insurance (since you mention having no bills/rent, I assume you live at home, which tells me you are young, which in term tells me your insurance on that car will be anywhere from $200 up to around $500/mo, depending on how young you are and what your driving record is), and uh, I don't know, money to spend wherever. your new shiny car will take you. No financier will ever give you a loan for a car if the car payment is more than around 30% of your income. Also, take into consideration that BMW Financial Services may demand 20% down payment ($8,800).

So.... I would not do it.

[AlpineSixAndSeven]

... Y do you need the 335i(not want) when you have the 325i almost payed off..... injoy that car for a couple years them maybe get the 335i in a couple years used for a lot less? i know i'm 19 and i want a shiny new 335i BUT I know it's a bad idea... 44k into a car that WILL lose value EVERY year... sry my vote stick with the 325i....

[drz]

By the way, when I said I would not do it, I meant to say that even if you decided to do it, you would not qualify for that loan.

ohandbytheway, don't open any more stinking credit cards!

[geewize]

Originally Posted by drz

Your income is $2k a month? I say no stinking way.

To get the rate announced by BMW, your credit score might be good enough, although they may be looking for a 750 or 760. Canceling your credit cards will not help at all. In fact, most of the time, that can only hurt your credit.

As a rule of thumb, you shouldn't spend more than 8% of your gross monthly income on car payments. For you, that would be $160. Rules of thumb aside, lets look at the numbers. That rate is for a 36-month term at most. That would make your payments around $1400/mo, which represents 75% of your monthly income. Even if that $2k you mention is your monthly take-home after-tax money, that still only leaves $600 for gas, insurance (since you mention having no bills/rent, I assume you live at home, which tells me you are young, which in term tells me your insurance on that car will be anywhere from $200 up to around $500/mo, depending on how young you are and what your driving record is), and uh, I don't know, money to spend wherever. your new shiny car will take you. No financier will ever give you a loan for a car if the car payment is more than around 30% of your income. Also, take into consideration that BMW Financial Services may demand 20% down payment ($8,800).

So.... I would not do it.

at 3.9% the payment is only 700-800 dollars
2000- 800 = 1200$ Gas and insurance.
The car wouldn't be put in my name for insurance thus brings my insurance down to about 200-250 a month.
All my credit cards are paid off.
that leaves me with over 900+ to spend on what ever I want as well.

As far as why I want to do it, I want to do it because I would like a new car.

I am going to find out if the 3.9% is for 48 months only or if it qualifies for 60 months.

[AlpineSixAndSeven]

... that doesn't leave you with 900... Credit card limits aren't your money... it is credit... which means you will be paying alotta intrest on the money just to have the stuff now... they should be for emergency use only(or to build credit) honestly save your money you will lose atleast 33% or that cars value just driving it off the lot which is a little more the 10K dollars dude... wait get it used you don't NEED that car you have a nice 325 (almost paid off right?) at least wait till the payments are up on the 325 before concidering a new car... belive me i'd driven nice cars it gets old after awhile and that little giddy feeling isn't worth the huge loss your gonna be taking SPECIALLY with you only making 24k a year.... that's 2 FULL YEARS of work with NOTHING ELSE going to just pay for that shiny new car... this is how people get into debit so early..... don't buy something you can't afford to pay cash for UNLESS you are building your credit up then like drz said the payments should be around 30% of you income.... I myself plan to finance a car when I get a better job(next couple weeks) so just wait a year or 2 and get it when someone else have already taken the major loss on the car...

[AlpineSixAndSeven]

... that doesn't leave you with 900... Credit card limits aren't your money... it is credit... which means you will be paying alotta intrest on the money just to have the stuff now... they should be for emergency use only(or to build credit) honestly save your money you will lose atleast 33% or that cars value just driving it off the lot which is a little more the 10K dollars dude... wait get it used you don't NEED that car you have a nice 325 (almost paid off right?) at least wait till the payments are up on the 325 before concidering a new car... belive me i'd driven nice cars it gets old after awhile and that little giddy feeling isn't worth the huge loss your gonna be taking SPECIALLY with you only making 24k a year.... that's 2 FULL YEARS of work with NOTHING ELSE going to just pay for that shiny new car... this is how people get into debit so early..... don't buy something you can't afford to pay cash for UNLESS you are building your credit up then like drz said the payments should be around 30% of you income.... I myself plan to finance a car when I get a better job(next couple weeks) so just wait a year or 2 and get it when someone else have already taken the major loss on the car...

[Numark318i]

Originally Posted by drz

By the way, when I said I would not do it, I meant to say that even if you decided to do it, you would not qualify for that loan.

Not true at all. My buddy made $2000 a month when he purchased a brand new Z4 under his name. With only 4 grand down.


thats a lot of car payment. Consider your future. You are going to want mroe new things down the line...cutting off half your income for a car...might kick your ass in the future. Then consider the speeding tickets your gonna get.

or tires...a set of good tires is $700 atleast with install.

meh..i would say dont do it. but do it if you feel thats teh right thing to do, and you know ur parents will help you out if ur in a shit hole.

[VegasSpeed]

Man, this is why we have so many forclosures. Everyone wants to keep up with the Jones family. Live within your means. You by no way should be buying this car.

[AlpineSixAndSeven]

Originally Posted by VegasSpeed

Man, this is why we have so many forclosures. Everyone wants to keep up with the Jones family. Live within your means. You by no way should be buying this car.

i like this guy already!
SCREW THE JONES TRICK OUT THAT 325!

[drz]

Originally Posted by VegasSpeed

Man, this is why we have so many forclosures. Everyone wants to keep up with the Jones family. Live within your means. You by no way should be buying this car.

+rep