What's the Market Like out there for buying used?

[RichAmy7_17]

Just sold a very small TT so we can upgrade
We want a cash deal...man, is it expensive out there still? Question- the 2015 I am looking at is very clean.. but I need to see in person!!! It is under 30' Jayco Jay flight it is Murphy bed and bunks. Asking $14,500. I think its a little high but dealerships are even worse. It is exactly what I am looking for. Thoughts and experiences please!

[Huntindog]

nickthehunter wrote:

Huntindog wrote:
...Of course absolutely no one will admit this, for obvious reasons.

8.4% Average Annual Return on Investment, 2.1% interest rate over the same 10 year period of time.
And I am able to negotiate just as good a deal as you are. My money and your money looks identical to the dealer.
Please tell me again how paying cash is best.

You should name the investments so all of your RV buddies can get in on it.
Fact is that there hasn't been such RISK FREE investments in a very long time,,, As for your rate of return.. I have done much better than that. but the other fact is it has been easy to make money in the market for the last 10-12 years, Any fool could do it. That does not mean there was not risk. With what is happening now, the next 10 years probably will be much different than the last 10 years.

[Grit_dog]

Huntindog wrote:

Maybe cash is not always king!

GOES WITHOUT SAYING THAT YOU NEED TO NEGOTIATE HARD.

In the deals you use as examples, I do not believe for a minute that the best deal was had....If I was to believe that, then I would have to believe that the lenders got taken by the buyers... I do NOT.Remember what I said about them being much better off than thr people they loan money to... That is no accident. They are pros at making money while leading their customers to believe otherwise

Of course absolutly no one will admit this, for obvious reasons.

So, Huntindog, I, like you, prefer to pay cash for anything I can afford to. Note, aside from 2 new vehicles over my entire time behind a steering wheel (which sadly is over 30 years, now), every other vehicle or "toy" (RV, bikes, boats, etc) has been purchased used and used private party.
Cash "can" still be king in these scenarios, but generally only for the lower priced stuff. Someone selling a $50-100k used (boat, rv, whatever) is generally not "after the cash, NOW" nor willing to forego some revenue for "cash" on a large transaction.

When talking about car dealers, new or used, cash is NOT king, regardless of what you learned back in whatever decade you started making large purchases.
Your soapbox is getting pretty weak...

[goducks10]

I'm sure there's some that are cheaper but probably not by much.
With the price of RV's today and the high interest rates that correspond with those high prices, now is not the time to buy with a loan.
Per Good Sam.
Loan Amount 5-Year 10-Year 12-Year 15-Year 20-Year
$100,000 - $2,000,000 4.24 5.39 5.49 5.49 5.49
$50,000 - $99,999 4.24 5.39 5.49 5.59 5.59
$25,000 - $49,999 5.74 5.99 6.25 6.24
$15,000 - $24,999 8.49 8.99 8.99
$10,000 - $14,999 9.49 9.49 9.99

My CU has 5% new, 5.25% used. To high for my liking.

[nickthehunter]

Huntindog wrote:
...Of course absolutely no one will admit this, for obvious reasons.

8.4% Average Annual Return on Investment, 2.1% interest rate over the same 10 year period of time.
And I am able to negotiate just as good a deal as you are. My money and your money looks identical to the dealer.
Please tell me again how paying cash is best.

[Huntindog]

Lantley wrote:
What I am saying is paying cash does not automatically give you a superior bullet proof deal. You still have to negotiate, you still have to play the game. There is still rebates and kick backs. And you are out of your cash. Your funds are tied up in a depreciating item vs. paying a fee to use someone elses funds.
Leaving your funds free for other puposes.
Is it better to pay 100K up front or 5K for 20 months. There is value to keeping your money in your pocket.
I've heard of deals where the dealer prefers to finance because they get a kick backs from the bank that they won't get in a cash sale. Hence they encourage buyers to finance and pay it off. It gave the buyers a better deal because they got the benefit of the banks $$ and a better price.
I've also seen scenarios where the best price was not a cash price because finance kick backs trumped the cash price.
Maybe cash is not always king!

GOES WITHOUT SAYING THAT YOU NEED TO NEGOTIATE HARD.

In the deals you use as examples, I do not believe for a minute that the best deal was had....If I was to believe that, then I would have to believe that the lenders got taken by the buyers... I do NOT.Remember what I said about them being much better off than thr people they loan money to... That is no accident. They are pros at making money while leading their customers to believe otherwise

Of course absolutly no one will admit this, for obvious reasons.

[Lantley]

What I am saying is paying cash does not automatically give you a superior bullet proof deal. You still have to negotiate, you still have to play the game. There is still rebates and kick backs. And you are out of your cash. Your funds are tied up in a depreciating item vs. paying a fee to use someone elses funds.
Leaving your funds free for other puposes.
Is it better to pay 100K up front or 5K for 20 months. There is value to keeping your money in your pocket.
I've heard of deals where the dealer prefers to finance because they get a kick backs from the bank that they won't get in a cash sale. Hence they encourage buyers to finance and pay it off. It gave the buyers a better deal because they got the benefit of the banks $$ and a better price.
I've also seen scenarios where the best price was not a cash price because finance kick backs trumped the cash price.
Maybe cash is not always king!

[Huntindog]

Lantley wrote:

Huntindog wrote:
What is risk priced at?
This is an important question, as to get the returns you are expecting,,, it is not zero. In your case, you are willing to take a chance that your money will earn 4-6%. It may not, in fact you can lose principle, never mind the interest. There hasn't been a risk free way to make that kind of interest for decades.
Paying cash means you efectively made 2.5% Garaunteed! RISK FREE! And this is tax free as well! Any other method of investing will be taxed at some point... A saving is never taxed.

And if you are in a position where you can save on taxes by claiming interest as a deduction... We are not even speaking the same language...You do realize that a deduction is not a dollar for dollar savings? Only a credit does that.

I don't dispute what your saying, cash is always king.
But buying with cash doesn't eliminate the risk.
The 50K truck is no longer worth 50K the minute you drive off the lot.
Granted we are in weird times,but generally an auto is a deprciating asset.
In terms of 0% and who pays. Often banks and car dealers are in cahoots. In doesn't hurt to use the banks money a little and pay the loan off early sometimes you can get the best of both worlds.
Banks are generally gambling you will not pay off early. It's possible to beat them at their own game.
It's all in the deal. Paying cash can have its pitfalls as well

So by financing a 50K truck, it does not depreciate?
If that is true, these are indeed weird times.:?

Have you ever looked at an amortization schedule? Most of the interest is paid in the begining... So much for the bank gambling you will not pay it off early theory

[Lantley]

Huntindog wrote:
What is risk priced at?
This is an important question, as to get the returns you are expecting,,, it is not zero. In your case, you are willing to take a chance that your money will earn 4-6%. It may not, in fact you can lose principle, never mind the interest. There hasn't been a risk free way to make that kind of interest for decades.
Paying cash means you efectively made 2.5% Garaunteed! RISK FREE! And this is tax free as well! Any other method of investing will be taxed at some point... A saving is never taxed.

And if you are in a position where you can save on taxes by claiming interest as a deduction... We are not even speaking the same language...You do realize that a deduction is not a dollar for dollar savings? Only a credit does that.

I don't dispute what your saying, cash is always king.
But buying with cash doesn't eliminate the risk.
The 50K truck is no longer worth 50K the minute you drive off the lot.
Granted we are in weird times,but generally an auto is a deprciating asset.
In terms of 0% and who pays. Often banks and car dealers are in cahoots. In doesn't hurt to use the banks money a little and pay the loan off early sometimes you can get the best of both worlds.
Banks are generally gambling you will not pay off early. It's possible to beat them at their own game.
It's all in the deal. Paying cash can have its pitfalls as well

[Huntindog]

What is risk priced at?
This is an important question, as to get the returns you are expecting,,, it is not zero. In your case, you are willing to take a chance that your money will earn 4-6%. It may not, in fact you can lose principle, never mind the interest. There hasn't been a risk free way to make that kind of interest for decades.
Paying cash means you efectively made 2.5% Garaunteed! RISK FREE! And this is tax free as well! Any other method of investing will be taxed at some point... A saving is never taxed.

And if you are in a position where you can save on taxes by claiming interest as a deduction... We are not even speaking the same language...You do realize that a deduction is not a dollar for dollar savings? Only a credit does that.

[propchef]

Huntindog wrote:
I pay cash because I can, and I hate payments.
0% interet loans just have the cost baked into the purchase
price. All the companies making such offers have much more expensive properties than the people they are making loans to.... That isn't an accident.It is their buisiness to make their customers feel they got a great deal, while they make bank off of them.

Only if you're using the seller's financing.

If I can get a loan at 2.5% from my CU, and my "cash" is earning 4-6% in various accounts then it makes sense. AND then I can itemize the interest because it qualifies as a second home. Yes, I'd borrow every time. With interest rates going back up, all bets are off.

YMMV

[Huntindog]

I pay cash because I can, and I hate payments.
0% interest loans just have the cost baked into the purchase
price. All the companies making such offers have much more expensive properties than the people they are making loans to.... That isn't an accident.It is their buisiness to make their customers feel they got a great deal, while they make bank off of them.

[Gdetrailer]

Lantley wrote:
The idea of paying cash generally keeps transactions clean simple and straight forward, however cash is not foolproof or always the best method.

Cash makes for a very quick and easy transaction for both parties.
Any type transaction with a asset which has a title and registration plus a lender/loan/lien makes for a potential messy transaction which involves considerable risk to all parties. Loans/liens also take considerable amount of time and adds cost to the transaction.

Lantley wrote:

There are times when low interest or 0% loans are a better method.

When? I cannot even think of this as a viable method unless there is no other way you can get a loan and even then a good chance you cannot afford the loan.

Zero interest or low interest loans ARE 100% subsidized and paid for by the BUYER in the form of a non discounted price. It is a marketing gimmick by the dealer and bank to get you to buy, thinking you are getting it for no extra cost when in reality, what happens is you sacrifice getting some of the dealer's discounts, you in the and pay a HIGHER upfront price (which happens to be the same equivalent cost as the interest you will pay for the length of the loan (IE you are paying ALL of the interest owed UP FRONT).

ALL zero interest loans are known as "closed ended" loans, since you paid the interest in full upfront, you get zero discount if you pay off the loan early and some banks may even penalize you with an additional charge.

I make use of paying off loans EARLY, every month I add an extra $10, $20, $50 to the payment towards the principle borrowed. Saves me tons of money on the purchase of the item. The interest I would have paid to the bank I put into my pocket which goes into may savings account for future purchases.

Many yrs ago, I wanted to buy a subcompact tractor with front loader, backhoe.. The tractor manufacturer offered $1K cash back outright purchase OR ZERO PERCENT loan.. My local bank would not finance the tractor unless it was a very high interest rate personal loan and I didn't have enough cash to buy out right at that time.. I took the zero interest loan and gave up the $1K dealer cash back, the $1,000 was the interest I paid for upfront.

Lantley wrote:

There are also times when using someone else's money is better than using your own!....especially when you don't have your own money to use. LOL

There is nothing wrong with "using" others money in the form of credit, provided you do not over extend yourself to the point of having to make the choice between eating, paying rent and making all of the interest laden payments every month.

Responsible use within reason, the problem is folks tend to get caught up in the supersize mentality of life.. A few pennies here and a few pennies there and soon you have much of your life enslaved to paying just the bare minimum payment charges, diggin the hole deeper and deeper into debt.

I have seen a lot of good folks go down that borrowing rabbit hole and lose it all, homes, cars and even marriages. One even had their home fully paid off, took out a loan against the home with variable rate when the interest was low.. When the housing bubble burst, they too found themselves with interest payments that eclipsed their income several times over..

Lantley wrote:

I digress...Using credit or borrowing is not always a bad thing vs. using your own cash. The key is to understand what you are doing and know how much the total transaction is costing you.

Like I said, nothing wrong with using credit, the problem is, folks get used to having that payment and don't think twice about adding more and more interest bearing debt.. Everytime you involve a loan, you are removing real money you could be using out of your pocket and handing it to the rich bankers.. I have not as yet seen a bank president driving a 20yr old rusted out barely running beater car.

Off soap box..

[Thermoguy]

If you are buying a used RV from a private party, you are always paying cash... The seller gets cash whether you pay cash or go to the bank, get a loan and hand him a cashiers check, he gets cash. Even if you buy from a lot, at the end of the day, the dealer gets cash and might even get a kick back if he helps you get financing.

I guess if you have cash in hand the seller gets paid faster, but when I bought my RV, I looked at it, made an offer, came back that weekend with a cashiers check and hitched up drove home. It was cash as I didn't get a loan, but paid with a cashiers check vs personal check or straight cash.

I don't think there's any benefit to a seller if you say I'm paying cash unless you have a briefcase full of cash and you are planning to hand it to them right then and there...

[Lantley]

The idea of paying cash generally keeps transactions clean simple and straight forward, however cash is not foolproof or always the best method.
There are times when low interest or 0% loans are a better method.
There are also times when using someone else's money is better than using your own!....especially when you don't have your own money to use. LOL
I digress...Using credit or borrowing is not always a bad thing vs. using your own cash. The key is to understand what you are doing and know how much the total transaction is costing you.

[nickthehunter]

That’s only true if you assume the person can’t afford to make two payments. The other assumption is that you’re hanging on to a depreciating asset in the belief that it will be worth more in the future. Neither assumption is a sure bet.
I have several loans, all of which I could pay off anytime I want. But up to now I make more by keeping my money invested than I pay in interest. My uncle joe may be blowing that up now and I may have to rethink that strategy. For now, and for the last 10 years or more, it’s worked out fine - I’m still way ahead in the game by not paying cash.