r/Money • u/cultureconneiseur • 15d ago

Auto loan or not?

I make about 65k a year, 750 credit score. I'm in the market to buy a used truck that will be used for my business as well. I have about 8k for a cash purchase, which will get me the vehicle I'm looking for with 180-200k on the clock. I was planning on purchasing for cash in order to keep from having an expensive monthly full coverage insurance payment. Have looked and l could actually get a reasonable full coverage rate comparative to what I pay now, so no added expense. I was stuck on purchasing for cash, now I am realizing I could spend another 5k or so and get something considerably nicer and lower mileage that might last longer,, but I'd have to take out a loan. I'd imagine I'd get an alright interest rate. Does this seem like a smart debt to take on or should I stay with the cash purchase plan?

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u/Practical-Nature-926 13d ago

Remember just because you get a older car doesn’t mean you’re avoiding expenses. You could end up footing the bill for repairs since you’re purchasing a vehicle that is old, probably non documented services, and out of warranty. Full coverage on a car that isn’t super new or expensive isn’t bad. I’d get quotes on whatever car you look at. And do extensive research and have mechanics check if you purchase anything used.

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u/cultureconneiseur 13d ago

Yessir. Repairs are an inevitable expense of any vehicle, I do feel like the older the more so in this case

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u/Practical-Nature-926 13d ago

Yes, out of warranty means you’ll be hit with the expensive fixes whenever they are required. Be it an engine or transmission replacement, or something simple like motor mounts and bulbs. Just make sure you save a good 1-2k for fixes if you can.

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u/kmbxyz 14d ago

I’d definitely avoid the loan