Car loans

🙂 Can someone please explain the actual difference between an auto loan and a lease?

I’m looking at picking up a new car soon, and I’m just trying to wrap my head around how they differ...

Thanks for any help.

wanderingscout54 said:🙂 Can someone please explain the actual difference between an auto loan and a lease?

I’m looking at picking up a new car soon, and I’m just trying to wrap my head around how they differ...

Thanks for any help.

A loan... honestly, even a recent grad should know this part😉

There's financial leasing and operational leasing.
With financial leasing, once that last payment clears, you own the asset—it’s basically just a standard loan, except you gain ownership at the end rather than having it from day one. With operational, it's more like a straight rental for a car or property, and when the term is up, you just hand it back...

In my opinion, there isn't much benefit to leasing for individuals (unless it's easier to get approved), especially if you don't want to deal with mandatory comprehensive insurance plus a 20% down payment)

I could really use some help here because I’m a bit out of my element with all this...
So, here's the deal. I'm planning on financing a new car next year. We're looking at a price tag of roughly $40. I've been at my current job on a permanent contract for about three and a half years now.

Regarding my income...
My take-home pay is $1000, but I also get extra payments a few times throughout the month—it's all clearly listed on my pay stubs and goes straight into my checking account. On top of that, I'm planning to put down a down payment of about $10. Do you think I'll run into any issues? Any potential headaches I should watch out for?
Any bit of info helps. Did I miss anything important?
Thanks!

Anyone got anything to say?! Guess I’ll just head down to the Ford dealership and see what they tell me myself...

hey,

just getting online now.
yeah, if you already know what kind of ride you're looking for, just hit up some dealership websites or give them a call.

from what I know, they cap your monthly payment at about 1/3 of your take-home pay. that's basically your credit limit—the max amount for your monthly installment.

I actually wrapped up my own loan and new car situation this past Thursday. Scrapped the auto loan idea and went with a personal loan instead. It gave me a much higher ceiling, meant I didn't need a co-signer, and I got everything finalized in Philly.

I’ve been chewing on that idea too, but from what I can tell, the interest rates are way higher. Or am I totally off base?
So, I ended up sticking with the auto loan...
I’m thinking about using my life insurance policy as collateral—I heard that’s actually a thing people do...

wearymarlin21 said:hey,

just getting online now.
yeah, if you already know what kind of ride you're looking for, just hit up some dealership websites or give them a call.

from what I know, they cap your monthly payment at about 1/3 of your take-home pay. that's basically your credit limit—the max amount for your monthly installment.

I actually wrapped up my own loan and new car situation this past Thursday. Scrapped the auto loan idea and went with a personal loan instead. It gave me a much higher ceiling, meant I didn't need a co-signer, and I got everything finalized in Philly.

I don't mean to be pedantic, but his pay is divided by 3. If we were dividing by 1/3, he’d be making three times as much money.🙂

Casey Ward4 said:I could really use some help here because I’m a bit out of my element with all this...
So, here's the deal. I'm planning on financing a new car next year. We're looking at a price tag of roughly $40. I've been at my current job on a permanent contract for about three and a half years now.

Regarding my income...
My take-home pay is $1000, but I also get extra payments a few times throughout the month—it's all clearly listed on my pay stubs and goes straight into my checking account. On top of that, I'm planning to put down a down payment of about $10. Do you think I'll run into any issues? Any potential headaches I should watch out for?
Any bit of info helps. Did I miss anything important?
Thanks!

Honestly, just head down to a dealership and they'll walk you through everything. I bought a car for a similar amount—around $132 $0.00 plus a $32 $0.00 down payment, so my loan was for $100k. They asked for my last three pay stubs, and my average income had to be higher than $1700. Hope that helps at least a little, if not, sorry... but it's definitely better to handle it at the dealership. You can immediately run through different financing models for 3, 4, 5, or 6 years, or play around with the down payment amounts. They'll print out exactly what your monthly payment looks like for each one, and then you just pick the best option.

electricsailor13 said:I don't mean to be pedantic, but his pay is divided by 3. If we were dividing by 1/3, he’d be making three times as much money.🙂

Yeah, obviously. It splits into three. Thanks for catching that. I figured out where I messed up a bit later, but I couldn't find the time to fix it until now. Today’s been a total madhouse.
Thanks. Gotta get people the real facts before it's too late.

Casey Ward4 said:I’ve been chewing on that idea too, but from what I can tell, the interest rates are way higher. Or am I totally off base?
So, I ended up sticking with the auto loan...
I’m thinking about using my life insurance policy as collateral—I heard that’s actually a thing people do...

Yeah, the rate is significantly higher, especially compared to a loan denominated in Swiss Francs.

Just run the numbers properly and decide based on that.

As for collateral, you could technically use life insurance or even a combo of dual life coverage and an investment fund stake.
Honestly, I wouldn't recommend that combo over just a straight investment fund stake. That mix isn't really "true" life insurance in the legal sense—there was actually an article about it recently.

I could really use some advice here.
So, here’s the deal: I started a full-time gig about three months ago, and honestly, the pay is pretty solid.
The company itself is a relatively new LLC—only been around for about four months—but business is already booming.
Do you think I’d actually be able to get approved for an auto loan worth roughly $33?

Thanks in advance for any insight!😉

It’s highly probable—given that you’re essentially putting your car up as collateral.
The absolute worst-case scenario here is a simple rejection; therefore, honestly, you have nothing to lose by trying.

The only way they’d pull a fast one on you is if you were still stuck in some probationary period at work or something. But honestly, I doubt it—an auto loan isn't exactly the same beast as a mortgage.

I’m looking to pick up a car, which means I'll need a loan for roughly $9,000—assuming I can scrape together about $2,200 from selling my old clunker. I’ve only been at my current job for three months on a temporary contract, though in reality, it's basically permanent... not that any bank cares about "intent" when the paperwork says three months here, six months there, and so on. My gross pay is at least $1500, but my take-home is closer to $430. Is there any chance a bank will actually approve me? 😕

I know I sound a bit lost, but I'm still figuring all this out.....🤷

If your paperwork says "contract ended," you aren't getting a loan unless you have a co-signer standing right there with you.

If you've only been on the job for three months, trust me, there are much bigger fish to fry in life than buying a car.

😕 I am considering purchasing a vehicle valued at approximately $50,000. $0.00I am having a bit of difficulty deciding which bank to choose, as I am truly uncertain which one offers the most favorable terms. Furthermore, I am currently torn between a four-year or a six-year term. I would greatly appreciate any advice you might be able to offer.😕

Honestly, how many years you're looking at depends entirely on your paycheck. It really comes down to how you play the game—are you walking onto a lot with a bag of cash, or are you financing through the dealership? Personally, I think the second option might be smoother. Those big dealerships usually have solid partnerships with places like JPMorgan Chase, and even if the interest rate isn't a huge steal, you save yourself a massive headache when it comes to all the paperwork.

Guys, I need some advice here.

So, basically, I just started this new job on a permanent basis. I’m assuming—though I could be wrong—that I won't qualify for any decent credit until I've been there at least three months, if I even qualify then. Anyway, the big question is: is there any way at all to buy a car right now instead of just sitting around waiting for three months? I'm looking at a more expensive used car, and honestly, the dream scenario would be taking out a personal loan to just go grab whatever I want. If that doesn't work, I guess I'd have to deal with a dealership through leasing or an auto loan. But then it hit me, and I wanted to run this by you all: is it actually possible for, say, a close friend of mine to take out a personal loan, and then once I finally become creditworthy in a few months, somehow transfer that loan or lease into my name so I'm the one making the payments? I mean, is that even a thing? Is there any realistic way I can get behind the wheel sooner rather than later?

Any help would be greatly appreciated.

How many hours are you pulling? There's no way you just started and you're already looking at permanent contracts. If you've been on the job for at least six months, you can grab an auto loan. Honestly, a dedicated car loan is the better move—lower interest rates—but JPMorgan Chase keeps the title until it's paid off. It’s totally up to you!
Regarding your buddy, his only real option is to take out the loan himself and then have you cover the monthly payments. I don't see any other way it's going to work. 😢

Richard Wright22 said:How many hours are you pulling? There's no way you just started and you're already looking at permanent contracts. If you've been on the job for at least six months, you can grab an auto loan. Honestly, a dedicated car loan is the better move—lower interest rates—but JPMorgan Chase keeps the title until it's paid off. It’s totally up to you!
Regarding your buddy, his only real option is to take out the loan himself and then have you cover the monthly payments. I don't see any other way it's going to work. 😢

Well, it's a permanent position, but I've only been on the clock for about ten days. My salary is roughly $7,500 a month, but before this, I wasn't officially employed—not even on paper. The thing is, I recently sold my old car, and I really don't feel like buying some total junk again. I'm trying to get a loan approved as soon as humanly possible so I can finally pick up something decent.