We've gotten ourselves in a tight spot since we lost our irl business back in Sept 05. We can pay our bills (barely) but this has dh working 7 days a week since then. I have offered to get a job but his 2nd job pays much more than I could make pt and he would rather work extra than me.

Anyways our van is a Honda 2003 bought new, now it has 16,000 miles on it runs great, etc. We still owe around $17,000 on it, so our payment is $563.00a month for about another 3 years. :shake: This is my car.

Our other car is a 99 Ponitac Sunfire paid off with 46,000 miles runs good. This is DH's car that he drives all day long for his ft job.

We have really been into Dave Ramsey lately and want to get rid of our debt and so far we have our $1000 emergancy fund. I have recently been offered a job that I am taking that will pay about $500 a month. (This means dh can quit his pt job if he wants to now. But he wants more in savings first.:heart: )

Anyway I know that Dave Ramsey would say to sell the van. Problem is that we feel that the van could easily last 10 or more years. I also need a vehicle since where we live it's too far to walk to schools etc. Also since we bought the van our credit has done a major nose dive and if we ever needed to finance a car again we would be looking at probably a 18% or more interest loan. But on the other hand we never want a car payment again after this.

So here are our 2 choices-

1- Keep the van and I keep the pt job and do it like the debt snowball.

2- Sell the van (we would probably break even). Pull dd out of preschool 2 months early (which she will hate lol) and then save the "van payment" until August and have about $3600 to go used car shopping in cash. I "have" to have a vehicle by then for dd's school, etc.

DH is worried that we might not be able to have a reliable car for that much money. We are also worried about being a one car family (while we are saving) but we have the emergancy fund that would take care of "most" repairs if something goes wrong with the Sunfire. I have told him the kids would rather have their daddy home on the weekends then to have the van. But again the van is nice, reliable & not replacable for us (to have to finance again we would never get a good rate). Also we don't know anything about doing car repairs ourselves. And if it matters we live in a very picky state that has state car inspections and smog tests yearly, I know that not all states are like that.

I hope that made sense. Bless you if you got this far. We have been going back and forth on this decision for the last month. lol

I will probably delete this in a couple days since I don't like all of our info out there. lol
Thanks! : )
Mandy

That is a lot of tough decisions to make.

I can tell you that we have been a one car family since we have been married (almost 7 years). My boys aren't in school and we plan on homeschooling them. When I do need the car I get up early, and it's not just me- I have to get the boys out of bed too, and we take dh into work and keep the car for the day and pick him up after work. Some days we ride the bus (it's only a 10 minute walk to the bus stop).

If there is anyway you could get rid of the second car that would help save money or pay off debt.

I would think that even if you get a used car and needed to repair it you would have some saving built up to do those repairs because you wouldn't be dishing out the $500 some dollars a month for a car payment.

Our one car will be paid for in May. We plan on continuing to "make car payments" but to our savings and when we have "enough" saved up and the right used car comes along we will get a second car.

Good luck with what you decided to do. It sounds as though you are making good choices and working towards a debt free life!

Tawnya

That is a lot of tough decisions to make.

I can tell you that we have been a one car family since we have been married (almost 7 years). My boys aren't in school and we plan on homeschooling them. When I do need the car I get up early, and it's not just me- I have to get the boys out of bed too, and we take dh into work and keep the car for the day and pick him up after work. Some days we ride the bus (it's only a 10 minute walk to the bus stop).

If there is anyway you could get rid of the second car that would help save money or pay off debt.

I would think that even if you get a used car and needed to repair it you would have some saving built up to do those repairs because you wouldn't be dishing out the $500 some dollars a month for a car payment.

Our one car will be paid for in May. We plan on continuing to "make car payments" but to our savings and when we have "enough" saved up and the right used car comes along we will get a second car.

Good luck with what you decided to do. It sounds as though you are making good choices and working towards a debt free life!

Tawnya

Thanks for your advice. : ) I forgot to mention that dh drives his car all day long for his job Mon-Fri (sales) and he's always about 1.5 hours away. So driving him to work and picking him up later is not an option for us. I really wish it was though. But I really have grown to hate having a car payment that is equal to some people's mortgages. Sad but true. Thanks again! : )

Look, we didn't have great credit but we negotiated with the car dealership and got 5.5% on a used car (told them dh's teacher credit union was giving us 6% and sorry but the 9% they were offering us just wasn't going to cut it). We bought a 2003 Mitsubishi at the end of 2004 for $13,500 plus $1,200 for an extended warranty to 87,500. We bought it with 17k miles on it as a used rental car. With minimal (maybe $1k?) down we had payments of $272 for 5 years. Just to give you an idea -

That idea being, maybe instead of just spending $3600 on the car, or keeping the $563 payment, you could use the $3600 as a down payment and buy, say, a $10-15,000 car. Like a used Camry - so reliable, you could probably get one with under 30k for that price (I don't know but when we were looking they were around $14-15k for one with 25k miles on it). Then you'd have a more reasonable payment without compromising reliability. $3600 isn't much for a good, reliable vehicle IMO.

I think if you can get out now, and break even, I"d do it. That's a long time to have such a high payment over your head. Summertime seems the perfect time to go carless, IMO. There is nice weather to play outside, it stays light a long time to squeeze in some time at a park or something after hours, you can go get groceries and such when DH is home w/ the kids. If you live close to places, you can just walk or bike. As for the cheap car, I think you are right! IMO, $3600 can buy a fine vehicle for part-time use. We bought our 96 suburban w/ lots of miles on it, for less than $5000, taxes included. You can get by with just a cheap car, especially if you have a reliable one already.

That van is going to last you at least 10 more years. I'd try to renegotiate the debt (maybe use house equity to pay it? A dear family memeber to front you? a low interest cc?) or snowball the payments. Sounds like you got a lousy lending rate. But no way would I buy a car that might give you problems when you now have a car that doesnt give problems and prob won't. I'd consider using the 1k towards the car, too. Savings is good, but debt comes first, esp when you consider that you are barely paying any principle at all on the van. IMO. Not that I am Dave Ramesy.

Patience is a virute. Imagine yourself in a year with a 3k car that turns out to be a lemon. Why buy trouble?

Anyway, I choose your #1.

On second thought, I like the idea of breaking even on the car. That's a tough monthly payment. But I would not buy a cheap car. I don't think there is anything morally wrong about carrying some debt for something one really needs- like a reliable car when one has small children. I think it's great to be debt free, but I also think it's not the worst thing in the world for a young family to make reasonable car payments for a decent car. You could maybe find a nice used Honda or Toyota (2/3 years old, I'm thinking). Maybe have a $300 mo car payment that you can snowball eventually.

Yep, we're thinkin' alike, Laurie - you can get yourself a nice slightly used sedan (Toyota/Honda) that's super-reliable for $200something-ish payments. Really. If that gives you the breathing room you need, do it!

I came back to add that it really depends on your car usage and needs. How far is the school? How often do you drive? That kind of thing.

We're big proponents of the "one good car one old car" philosophy. Dh just took the good car to work. He usually does; he drives 40 minutes each way every day and it's better on gas and more reliable. Today I have to drive ds to school because he has OT here at the house this morning. We'll drive the 10 minutes to school in the old truck and it will be okay; not what I like to do but fine occasionally.

On Wednesday I have to drive all around town and to a bigger town about 45 minutes away. I'll take the car and dh will drive the truck to work.

So, it all works out...if the truck is in the shop and I have to go somewhere while dh is at work - yeah, we're kinda screwed. But we work it out; I can always drop him off at work and do what I have to do. And we tend to do preventive maintenance - like schedule work that we know needs to be done ahead of time. Yes we might spend a little more $ that way but not so much to justify another car payment. Also dh doesn't work in the summer, so big jobs, like the transmission replacement that's coming up, can be done then.

I would think that even if you get a used car and needed to repair it you would have some saving built up to do those repairs because you wouldn't be dishing out the $500 some dollars a month for a car payment.


Tawnya

I agree:) Sell the second car---if you really need another car, use the proceeds from the sale to get a cheaper car. We are a one car family currently and it does have it's struggles/challenges and takes planning. We will eventually get another used care, but not until we can afford to pay cash for it.

Okay, so we have found ourselves in similar situation. One thing to consider, as we are, is that if we got to say apply for a new mortgage anytime soon, which I think we will in the next year or so, that extra $200 a month car payment could be a real dealbreaker on how much we can get financed for. You can get a totally reliable car for $3500. The problem is, you just never know. I think we are just going to pay to repair our old mercedes (lol which is THIRTY years old and has 300K miles on it) because we can probably get more time out of it and not have a car payment showing.