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post #8 of (permalink) Old 07-14-2014
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Originally Posted by MikeNSX View Post
On an 84 month loan, you will be upside down for at least 5 years on the Mustang.

As a stockbroker / financial adviser for the past 30 years, my advice to my clients is that if you cannot afford the payment for a car on a 36 month loan, you cannot really afford to buy that car (and should really consider something cheaper).
Originally Posted by tommy9946 View Post
Mike, you obviously know your stuff. This is good advice. Now personally I didn't follow it, but I absolutely agree in principle. I have a loan on my vehicle, but the car is worth more than I owe because I put a good chunk down. At any point, and for whatever reason (if I see fit), I can trade in my car and be in an equity position. I figured my cash was better spent investing when I can earn more than I am paying in interest. And I am a car guy and had to have it.

And on that note, OP, I have a small suggestion/question. Can you wait a year or two? If you waited for, say, the 2017 Mustang, you won't be upside down on the Focus (I would imagine). Ford will up the horsepower of the car by then (again, I imagine), and you'll have the latest/greatest Mustang with a good three years where it'll be the current generation body style. In addition, it gives Ford time to work out the kinks. Finally, you will get a MUCH better deal as it won't be the hottest new car release.
I, too, absolutely agree in principle, and if I were only going to be getting 1 car, I would have done just as Mike suggested.

But the plan was to get 2, so I had to weigh not eating versus the fact that we weren't planning to offload either car before they were paid off, and we went ahead and financed them for 6.

What I did do, however, was lay a big down payment on the first one, then waited 2 years so that I could scrape together a decent, though not as good, down payment on the second one.

What does make me scratch my head, though, are the people who have to have a new ride every 2 to 3 years and take out 72 and 84 month notes knowing full well they aren't going to keep the car any more than 30-36 months max. They are always chasing the interest and never build any equity in the car while constantly getting pummeled by the depreciation of each subsequent car.

OP, Tommy's suggestion in the second paragraph of his post is spot on.

Back in 2005 I was in your very position. I had just bought a 2004 F150 Lariat edition the year before and then the all new S197 Mustang snuck up on me. I wanted one in the worst way, especially after my little brother bought a 2006 GT Premium in September of 05. I probably could have pulled it off, but it would have left me horribly upside down. My dad, my brothers, and my wife talked me out of it, and as you can see, it worked out in the end.

If you absolutely have to do it, then go with the largest down payment you can stand-the more you can pay now, the less you have to finance, though the answer to your question is that the dealer will only require a $500 security deposit that Ken mentioned above. Your finance company may require a down payment of some amount, then again, they may not.

Hers:2012 Mustang GT Premium,6M,Kona Blue Exterior/Charcoal Interior, 400A, HID/Security Pkg ,Comfort Pkg.
[COLOR="DimGray"][B]His: 2014 Mustang GT Premium,6M,Sterling Gray Exterior/Charcoal Interior,400A, Reverse Sensing/Security Pkg, Comfort Pkg SMR# 3635
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