Who's buying a vehicle before the Fed increases interest rates more?

[dutch_henry]

The Fed just bumped up interest rates another quarter of a percent to 5%. I anticipate that auto loans will likewise get more expensive as a result. Has this recent news had any effect on vehicle purchases you're considering?

As for me, I'm weighing pros and cons of...

• Taking out a loan for good, late model used truck with the thought that I'll have it for the next decade (I tend to hold onto my vehicles well past 200k). Prices haven't fallen to pre-pandemic levels, but otoh interest rates and inflation counter that to some extent.
• Paying cash for an older, higher mile truck if I can find a unicorn. (easier said than done in this part of the country)
• Doing nothing. Our current rig should be good for another couple years and we can eat the escalating repair costs associated with underbody rust, which is a big issue here in new england.

Still weighing pros and cons of each and it made me wonder how other roksliders are thinking about it.

 

[CorbLand]

What’s the anticipated cost of repairs vs the anticipated cost interest will cost you?

 

[Crusader]

Following

 

[keller]

I am a mechanic and ordering a new truck.living in the midwest salt belt my stuff rusts out before it wears out. So I'm gonna try to stay ahead of that.

 

[dutch_henry]

What’s the anticipated cost of repairs vs the anticipated cost interest will cost you?

Good question. Depends on how you scope it. On those two metrics and only those two, it's pretty much breakeven.

But you add in other real-world factors and personal preferences...from incurring debt, to insurance costs, to personal enjoyment, to market uncertainty, etc., etc., and the calculus gets kinda fun

 

[CorbLand]

Good question. Depends on how you scope it. On those two metrics and only those two, it's pretty much breakeven.

But you add in other real-world factors and personal preferences...from incurring debt, to insurance costs, to personal enjoyment, to market uncertainty, etc., etc., and the calculus gets kinda fun

Only you can answer the second part of that question.

If it’s a break even, I would get the new pickup and enjoy it. Costs you the same.

 

[Gutshot007]

Was surfing around chevy website . They have 0% financing through gmac for "well qualified " buyers for 1/2 ton trucks . Not sure of the ties between feds rates and auto loans if any ? Man are they pricey. n
Not planning on buying one soon ! Hopefully used market will soften . Good luck

 

[WCB]

Wife bought a vehicle just a couple months ago. Even with the interest rate hikes at that time she still got an interest rate similar to what she had on here last vehicle from 5 years ago. I'm just throwing these numbers out rate at 48mo now on average is like 6.1% then they were like 4.4% but hers both then and now are in the low 3s with no buy down.

But the answer to your question is no not buying one.

 

[Riplip]

If you decide to buy your credit score will have much more of an effect on your interest rate than the fed funds rate. Best thing you can do is work on increasing your score and cleaning your credit report.

 

[Ucsdryder]

I know a dealer in Colorado selling new trucks back of invoice now. Invoice, not msrp.

 

[GetWestern]

I hate the state of things that trucks are in now, what happened to the basic trucks that don’t cost the price of a luxury car. I’m in the market right now and am contemplating waiting another year or should I just bite the bullet now and get it over with.

 

[cnelk]

Not me.
With the added price of insurance, taxes and registration fees, I'll pass.

 

[JD Jones]

I know a dealer in Colorado selling new trucks back of invoice now. Invoice, not msrp.

Ford? Let me know … looking at gas f250s

 

[Ucsdryder]

Ford? Let me know … looking at gas f250s

This is a Chevy dealer.

 

[Billogna]

I'm in the market too! My advice: Hang on a few more months if you can. Tax season is Car Dealer's Christmas with all those tax refunds getting put towards new cars. And this year the dealers are already starting to figure out that tax refunds aren't as big this year. Repo's are on the rise as are delinquent payments from prime buyers. The market is set to crash here anytime. Dealers have been paying too much for their used inventory at auction and are about to be STUCK with these cars no one will touch for the price. There will be great deals for patient buyers. Don't be afraid to make offers and let it soak. Once these cars have been on the lot 60 days plus the dealers start getting pretty thirsty!!

 

[Gseith]

I am a mechanic and ordering a new truck.living in the midwest salt belt my stuff rusts out before it wears out. So I'm gonna try to stay ahead of that.

I just did the same before winter. Lots of fluid on my new Chevy.

 

[longspeak74]

Nope. Just turned 106k and with regular maintenance, she's got plenty of life yet.

 

[Dos Perros]

Only you can answer the second part of that question.

If it’s a break even, I would get the new pickup and enjoy it. Costs you the same.

Funny how people are different. For the same costs, I'd rather keep what I have and pay the local mechanic before the banker and send a vehicle to the scrap heap.

 

[CorbLand]

Funny how people are different. For the same costs, I'd rather keep what I have and pay the local mechanic before the banker and send a vehicle to the scrap heap.

It would depend on how unreliable the old vehicle is getting but I don’t really get rid of vehicles until they become unreliable.

If the cost to me is the same and it doesn’t have to spend time in the shop or leave me stranded on the side of the road, I am going to take that any day.

This all coming from someone that drives a 22 year old pickup.

 

[The_Jim]

There’s a lot ways to justify a new vehicle but not making monthly payments is pretty hard to beat. I will always go the debt free route.