airbrush1

I've been thinking about selling my turbo car...

Maybe I'm an idiot, but from a financial standpoint it may be the thing to do.
I know I'll never get all my money back out of it, I've put thousands in that I'm sure I'll never see again; but i got a sweet deal on the original purchase price of the car so I may be able to make enough off of it to pay off my second miata..... It would be wonderful not to have a car payment.

I'm not in a position where I HAVE to sell it, but in a position where for the right price I might be stupid not to let it go.

Anyone here been in a similar position? Any words of wisdom for someone on the fence?

msydnor

iTrader: (3)

My opinion, don't let the economy hype/scare make you sell ****. If you are not hurting and it's business as usual, then keep you ****. I have trouble seeing the effect of the economical downfall because I work for the government and plus I get a retirement check for my military service. Don't get me wrong, I know people that it is hitting hard, but it's not really hitting me, so I'm not going to change the way I do things just because.

airbrush1

Well work has been slow, and I work piecework at a dealership doing body work, If we aren't selling cars, then we're not building cars, and I'm not making any money.

Right now I'm still doin ok, but things have been better.

msydnor

iTrader: (3)

That being the case, cutting back may not be a bad idea.

Joe Perez

iTrader: (8)

+1.

Your car is an unrealized loss right now.

An unrealized loss is when you have an investment that has dropped in value, but you haven't sold it yet. Say that last year I bought 100 shares of ACME at $10 each, an investment of $1,000. A month ago, ACME's founder and CEO was convicted of child molestation, distribution of heroin and embezzlement, and was discovered to be a satan-worshiper. As a result, the stock price plummeted and now the market value of ACME has fallen to $5, so my investment is now worth $500. On paper, I have a $500 unrealized loss.

If I were to say "enough is enough" and sell my 100 shares today, then I would have an actual loss. I'd be out the $500 and that would be that. However I have another option- I can hold onto the shares in the expectation that they may increase in value. Say I do that, and a month from now ACME appoints a non-felon to head the company, who is warmly received. The market value increases to $7.50, and now my investment is back up to $750 in value. On paper, I'm still in the hole, but not by as much. If six months from now ACME invents a cure for blondness, their share price will rise tremendously, perhaps to $15. At that point, my investment will be at $1,500, and that so-called "loss" will never have happened.

It's like that with your car. If you sell it now, you may very well take a hit on the sale price relative to what you might be able to sell it for a year from now- particularly with the automakers currently offering no downpayment and 0% financing to keep people coming in the door, and used-car firms offering to give you free gas for life and a blow job too. You might even sell it for less than your current loan balance, depending on how long you've had it and what your downpayment was. Once all the dealer incentives dry up, then the private resale market will improve.

On the other hand, it sounds to me like this is your third car, and that you're making payments on two of them. In my opinion, financing a car is nearly as stupid as leasing one, doubly so for two cars. If you really don't need them all and feel you can sell it for a reasonable price, then it might actually be a good move. Getting yourself out of any and all auto loans is always a wise move, unless the money you're paying them off with would otherwise be in an investment whose annual rate of return is greater than the finance cost of the car. (*)

The only caveat would be if you decide to buy another third car in the future- that would put you further behind the 8-ball and make having sold your current third car a mistake.




* explenation: Say that I have $20,000. I wish to purchase a new car which costs $20,000. I am offered 5% APR financing on the purchase of the car. On the other hand, I have some other money in a market fund which is steadily returning 8% per year after capital gains and expenses. In this situation, it would actually be better for me to take the loan at 5% for as long a period as possible, and make only the minimum payments on it. The reason is that the cost of the loan is less than what I'd be sacrificing by now putting the money into the higher yield investment.

msydnor

iTrader: (3)

Good example Joe. My last project was a 87 mustang GT...358 built motor, turbo, suspension, the works. After about 20K invested, it was just a rat hole I was dumping money in. I sold it recently because although I could'nt get out of it what I had in it, it was smarter to take the lose and move one. It was fun while it lasted, but I didn't have the time to keep it going, and I lost interest in it.

Stealth97

iTrader: (5)

Get out of any car loan that you can. I traded in my new car and bought a POS, with cash and started having my "car payment" deducted straight out of my paycheck and into a savings account. It has not even been a year yet and its amazing the amount of extra money I have saved.... If you cant get out from under it pay whatever you can each month extra, it will save you cash in the long run, big time.

Mach929

iTrader: (3)

my miata is relatively economic and reliable car, i see no reason to get rid of it, the money i get out of selling it definitely won't get me anything better

i've also never made car payments because i hate debt

msydnor

iTrader: (3)

That's good advice if you can't afford the loan, but for me, and many others, the car you want may not be afforded without a loan. if you can afford the loan, nothing wrong with a car payment. Just be smart about it, pay it off early if you can, make the best deal possible up front. I plan to buy a C-6 Z06 in the very near future, i can't pay cash for it but I want it and can afford it. I see no reason not to buy it.

Newbsauce

iTrader: (2)

Joe's example, sadly, is my real world example with Freddie Mac.

brgracer

iTrader: (14)

Maybe price it a bit higher than you'd be happy with, and see if you find just the right buyer? That way the decision to sell will be based on a willing buyer at that price vs. just deciding to sell to pay off the other car?

Or, since you are not in a rush to sell and have the extra time since work is slow, have you considered returning the miata to stock, and parting out the goodies for a little extra return vs. selling the car turboed?

airbrush1

No way it's going back to stock, gone too far at this point to turn back lol.

Figure I have a 2000 miata with 68k miles, 300 whp done right (well 292, but 300 sounds better), factory hardtop, reliable, etc..... Would $10k be too much to ask? I'm thinking that's my "find the right buyer" number at the moment. I continually see NB's with comparable mileage, in worse, or comparable exterior condition at local dealers for around that number.

y8s

iTrader: (8)

keep in mind that most people view modifications as a liability.

virgin vs. ****

Scuba_Steve

iTrader: (4)

I understand what you are saying, but based on your above comment, anything I have is for sale.

While not very eloquent, Matt cut right to the chase, our cars are ***** and you have a very limited selection of buyers "at the right price".

Saml01

iTrader: (9)

I agree with Joe.

Personally I was thinking about selling my car too, but with the amount of money I have in it, and considering how much I can sell it for, it wouldn't be a financially wise decision to do so. I would lose a lot of money, why do that when I have a perfectly good car that doesn't break the bank.

If it came down to getting rid of it because I need a new car, I would sooner put it in storage which will cost half of my monthly insurance and then just take it out of storage after I can afford to run two cars.

Plus I would feel bad throwing away all my hard work just like that.

jayhovah

find the right dynojet and you can get printed proof of 300whp

y8s

iTrader: (8)

I think eloquent is exactly what it was. succinct and for this audience.

but really, selling a labor of love is never going to produce a return on the investment.

the best you can do is price it for the market. somewhere between someone buying it without negotiating a lower price... and nobody answering the ad.

kotomile

iTrader: (24)

You'll likely never get what you want for it, and you absolutely won't get what it's worth. I made that mistake with my CRX, it was worth around 9k, but no one pays 9k for a CRX. I had to let it go for 5k.

UrbanSoot

iTrader: (24)

i was about to sell my miata recently but looking at gas prices and that my 350z gets 14mpg on street, im keeping miata because it will pay itself off within 3-5 months in gas savings.

oh... and i parted out most of the expensive stuff and actually made $$ on it which i invested back into a car for some modifications (cheap-o turbo, suspension, etc) and came about even on it. if i would have kept few things and maybe sell few things a bit higher, i would actually get money that i paid for a car back and would pretty much have it for free

UrbanSoot

iTrader: (24)

and my previous miata: sold it for $5500 with some good mods (right buyer) and came about even on it after a part out.

point is: part it out no matter how many mods you already have on it. you WILL get a lot more money back.