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Our method was to add enough money to our home equity line of credit to cover the cost of the car so we could buy it in cash. Well, technically, it took a couple weeks for the HELOC expansion to go through and we needed a new car pretty much right away because the old one died, so we ended up financing the car through the dealer and making one monthly payment before paying the whole loan off.
Since HELOCs have variable interest rates, this is a theoretically risky move, but it’s at 1.75% now and I’m sure it was as low if not lower when we bought the car (in 2008, right around the time of the Big Crash), whereas the dealership financing was 5.5%, so we definitely came out ahead.
Obviously this is a great instance of Financial Priviledge Helping Maintain Our Financial Priviledge, since we were only able to get this extremely cheap loan because we already (a) owned a house and (b) had plenty of equity in it, since my wife bought it right before the bubble began inflating.
We’ve taken money on and off the HELOC over the years since so it’s hard to say if or when we’ve paid the car off, but our overall debt load is lower now than it was when we bought the car so I’m going to say we have paid it off, more or less? Sure, let’s say that.
@LookUponMyWorks
I bought a used car two years ago for just under $19,000. It was 3 years old, had less than 15,000 miles on it, and was the exact model and color I wanted. The dealership also threw in 12 free oil changes and tire rotations, so maintenance has been dirt cheap. Totally worth it.
My electric bill is $115 a month. I have an equalizer plan so I pay a set amount each month and it occasionally gets adjusted up or down depending on usage. I’m in Phoenix in a 750 sq ft, 71 year old house. It’s just me, but since I have two dogs and a cat I keep the ac a little cooler than I would during the day otherwise. I haven’t turned on the heater in two years.
Before the equalizer plan, my bills went from $30 in the winter to $200 in August. I also pay about $20 a month for gas, billed separately, for my water heater and stove.
@cjm what exactly does “interest” mean on a leased car, anyway? If strictly analagous to renting an apartment, it’s not like there’s any principal to pay down, right, and you’d just pay lease payments for as long as you have the car? Or is it a rent-to-own type situation where you can just give it back if you want OR you can end up owning it if you pay lease payments for long enough?
Really great article and I’m glad Anna had someone knowledgeable and kind to help her through the process. I was unemployed four years ago and the only job I could get was working as a debt collector. Some of my debt collector coworkers were pretty aggressive on the phone. I was very timid, which is why I didn’t last that long as a debt collector. How ironic that I was asking people to pay their bills when I was worried about how I was going to make rent. I would love to see a follow up from Anna to learn how it’s working out for her.
@e I love the Arclight! It was my go-to theater when I lived in LA, even though I was poor – it’s only a little more expensive and so much nicer. Plus if you go opening night, sometimes you see some of the cast in the theater with you, which is fun.
What a lovely, lovely thing this is. I would love to hear about other collaborative home duties, like childcare co-op or house cleaning co-op.
My gas and electric are lumped together, and the bill varies greatly across the year. It’s about $25 in the summer because there is no AC, and goes up to about $125 in the winter when the heat is on. It probably averages to about $75/month, maybe? This was for just me in a large, old house. Now that the other two rooms are being filled, it will probably go up.
This is so sad. Especially because economic hardship forbearance is such an easy thing to set up. I used that to put off my loan payment through a financially rough six (!!) year period. Now I’m on track to pay it off in another six years (I’ve got four times the author’s debt). DON’T DEFAULT PEOPLE!!
They have reserved seating at Icon here in Chicago, but like others I don’t usually go to big movie theaters. Landmark and Music Box are my spots, (with exceptions for Hunger Games and Silver Linings Playbook which I just realized are both JLaw movies).
@LookUponMyWorks seconded on the follow-up. and congrats to you Anna for finally taking that step!
When you first mentioned how much your loans were, I thought “Oh, that’s nothing!” – this is the problem with our society.
One person and two cats in a one-bedroom. My apartment is impossibly hot all of the time (I turned on the heat once in the Winter and regretted it just a few hours later) and the A/C is in a closet, which is, as I am sure you can imagine, incredibly inefficient. My bill has been $17-$26 since September and I’m sure the rest of the summer will be on the high end. I think about $12 of that is unrelated to actual usage.
@echolikebells and @sunflowernut Thanks! It’s a cute little ritual that’s lasted months longer than I thought it would (meaning, it has lasted a few months).
Mike, AMC is starting to offer reserved seating at some movie theaters! Lincoln Center apparently has reserved seating, and maybe W 84th Street? They did put in the comfy red recliners at 84th street last month… I first discovered this at the AMC Courthouse in Arlington, VA, which has recliners AND reserved seating, so my parents refuse to go to other movie theaters.
@faustbanana I wish Sharon worked at Comcast.
@xxAnniexx That sounds awesome! I wish I had coworkers to do this with
OK here is my method: buy a solid, used car from a dealership and finance it, but make sure to finance it for well under the Blue Book value in case you need to sell it and pay off the loan — when you go to grad school overseas the following year, for example. Try to do this just before a global financial crisis so the car will be impossible to sell, and eventually allow it to be repossessed after trying literally everything to sell it for a reasonable price. Still receive e-mail advertisements from the dealership four years later.
It’s $40/month for us September – May. June’s probably going to be $55. July and August… $90?
Yikes, Lisa is paying almost $20,000 for a used car. And she seemed to have shopped around the most!
I have no idea, because it’s included in my rent (as is water). Pro: I can crank up the heat in the winter without worrying about the cost. Con: I have less incentive to remember to turn the heat down overnight or when I leave the house.
Other con: I’m convinced that the reason my landlord won’t fix the laundry machine so that the hot water works is so that he won’t have to pay for people using hot water. Every time I want to wash sheets or towels I have to go to the laundromat.
So, I went to high school in Thailand and one of the things I really miss about Bangkok is the movie theater seats. You can not only choose and reserve your seat but you can also get couch seats and bed seats and reclining seats that are huge and comfy. I really with the US would have that (although it would probably crazy expensive here).
ETA I also wish there would be better movie selection in the US. The reason I don’t go to theaters isn’t because I don’t want to buy a ticket but because I don’t care about Fast and Furious 4 or whatever. I’ll go to smaller movie theaters that show other things, and I do like blockbuster movies, but so much of what is coming out now is pretty terrible that I’m not motivated to get off my couch and go to the theater.
That’s my theater Mike! They also take a care with picture quality, sound, etc, so it’s real nice there and public transit accessible. Also fun thing in LA is people often clap at the end of movies, which I like a lot.
Agreed! I would pay to reserve my seat (though likely complain about it bitterly…I still do with airlines)
However, better movies would be a more likely way to get me to the theatre more frequently. Less boom, more plot please!
When I saw it was a sponsored post, I was worried you would have comments turned off, like The Awl has been doing. And then I forgot what I was going to say but left this comment anyway.
Wow. I admit to breaking into a nervous sweat just reading this. Perhaps I am at the opposite end of this spectrum – I couldn’t ignore my student loans even if I wanted to; I feel compelled to check them regularly online (yup, still there!) and throw an extra $50-500 at them as my finances allow.
Anna, I commend you for confronting your default. It’s remarkable, isn’t it, for how we let something grow and grow in our minds until it becomes some Lernaean Hydra. You thought you had no choice, but as you say it hasn’t been that bad. I really hope the consolidation goes through. If you’re willing/Logan and Mike are willing, could we get a follow up piece in a month or two?
@xxAnniexx I love this, and I love the idea of it mending a relationship between coworkers!
