The Trap of Owning a Car

StMichael SG

I am in a bad situation now. Let this be a warning to all aspiring car owners as well.

I want to sell a Suzuki Swift COE car I bought for 38k a year ago, as I am going overseas. I contacted the leasing company (SDL) and realised that I owe about $34k (after a year out of 7!).

I looked through the classifieds and noticed asking prices for about $26k. This translates to a negative sale of about $8k. Which I will have to pay upfront to sell my car or the leasing company will not release the title Crying or Very sad .

I tried negotiating but the company mentioned that they cannot allow me to pay by instalments as they are a leasing company and MAS regulations will not allow them to do that.

Now I am stuck in a terrible situation. Nobody in my family drives or wants to buy a car. My credit situation makes it difficult for me to come up with the $8k. Now I am stuck with paying for a car that I do not use!

Next time, I will be extremely careful about buying depreciating assets like cars!

sgboy2004 SG

Thanks for sharing...

Neutral Neutral Neutral

CarDreamer SG

May b u ask n c got ppl 1 2 continue ur instalment?

Tot u r paying instalment now? u got a high loan izzit?

seizure_00 SG

poor guy. thanks for that anyway

brian SG

Thats bad manz… hope someone is willing to buy over the car soon. This serves a warning to those who wants to get a car, its not easy at all! 7 yr loan or 10 yr loan, remember to have backup plans.

roger SG

come to think of it, average expenses for an ordinary car comes up to an average of about $1000++ per month. if the person does not buy a car and save the $1000 per month, he will have at least $12,000 at the end of one year.

at the end of the day, its up to an individual to decide whether its worth paying so much for an asset that is losing so much money per year, or to put his money to better use. what's a bit of inconvienence if i can save so much by not buying a car!!!

i for one, would like to have a fat bank account rather than a car. what about the forum members here?

CarDreamer SG

Hello there,

Quit true if you dun own a car u can save alot and use the money to go tour, by the latest fashions or buy the lasted gadgets. However, depend on what you want in life as different people have different characters.

For me, i would like to have a car, so that i can drive around Singapore myself (like driving), enjoy what i want when i alive. After all save up so much, we can;t bring it to another world.

Thus, there are people who save, save save save n more saving.... and don't spend, just save (meaningless rite, earn and keep) and hope to use when retired but who noes how long you going to live (may end up with fat bank but never get the chance to use). I think (this wat i think la) save what you think is ok and buy something to reward yourself. May be next time Singapore no company ( all go China and India) and we can't afford a car then at least no regret as i did own a car before. Mr. Green

I do agreed if you buy a car you are actually throwing away money.

For me i like to have enuff money and a car since i got house already car is my next target. After that no more liao, wait to die.. kekekekeee....

By the way, you guys think how much should you earn in order to feed a car. Me still working on it.... may be in 2 to 3 years time... Shocked

tripp_4 SG

Well it pretty much depends on your responsibilities and priorities, saving for marriage, business or kids.

Nothing wrong wif buying a car at an early age but make sure it doesn't jeopardize your later dreams.

So cardreamer wat car have u decided on? Wink

CarDreamer SG

Well... zooming at above 10 year just renew COE sunny or getting a new Altis or lancer.

Right now think zero down to new lancer.... still thinking.. not so fast.... Very Happy Rolling Eyes Wink Laughing Smile

Used to ride bike. Bought a second hand bike and it gives me alot of problem so now got phobia on 2nd hand vehicle (may b me luck no good Shocked ). After that ride new bike then ok liao enjoy the road in Singapore and Malaysia but dam rain always hitting on me super pain Evil or Very Mad Twisted Evil

StMichael SG

There were many things I learnt:

In the early years of your loan, most of the money goes towards paying off your interest, just like housing loans. In other words, when you sell off too early, you will realise that a great deal of your principal is still around, to be paid off.

I took a $38k loan (100%), and after 16 instalments of $587 a month, I still have about $34k. Doesn't take much maths to do the calculations. My Swift with COE expiring Jul 2011 has offers of $24k.

That was the second thing I learnt - I suspect I paid too high a price for the car. Even assuming I knock off $3k for the dealer's profit, can a COE car depreciate $9k in a year?!?!?!? That was the price I paid for not checking out properly. Sad

I paid a fair price for the first car I bought in my life, only to be killed by the second car I bought. Goodness. Let this be a warning to all our friends out there - please be very careful. Buying a car is almost like having a child - you may find yourself stuck with it even if it kills you financially.