Tacoma vs Montero

[Martinjmpr]

Yeah, $7k for a 2002 Monty sounds high. Around here you can get a low mileage 3rd gen 4runner for around $7k and a Monty of that vintage wouldn't be over $5k, probably less.

The dealer knows that 4x4 Tacomas are high-demand vehicles and he can get a lot for it, that's why he's willing to pay off your Taco but he's charging you a $2000 premium (at least) because he thinks you are desperate.

Think about it this way: If the dealer is willing to buy it from you for $24k, then he probably figures he can sell it for at least $25k. OK, well, you can always wait a few more payments and then sell it yourself for the $24k and then have the $7k (which it sounds like you have?) to buy a vehicle for yourself, which should be more than enough to get a decent vehicle.

Yes, selling a vehicle with a note on it is not as easy as selling one you own free and clear, but it can be done (I sold my '04 Taco when I still owed $11,000 on it, and sold it for $12,500.) As with many things in life, you pay a lot for the "convenience" of having someone else (the dealer) do what you could do yourself.

Your example, BTW, is the reason I will never, ever, buy new again.

 

[Applejack]

I think you would be the first man in existence to trade in a Tacoma for a Montero.

I am sure they are nice vehicles, but look elsewhere in your daily spending to free up some cash.

There must be something dumb you spend money on ( I personally got rid of DirectTV and saved 60/month)

I stopped eating out so much (saved 400/month)

It is the little things that add up.

Your truck is an appliance and you need it to work for you. Gambling with a used vehicle with unknown history is not wise in my humble opinion.

The Irony is that the Montero Owner probably traded it in on a Tacoma!

This is good advice however, carrying as little debt as possible, or better yet no debt, is more liberating than driving a nice new vehicle that a bank owns. I traded a new (then) 2005 DCSB TRD O/R, on an old '99 4runner. Yes the Taco was my dream truck but it didn't make me any happier, but getting out of more than $30k of debt did. Soon after my trade down, my brother did the same. Traded in a 2006 Nismo frontier for a 2001 Montero limited. Same result, happier to be debt free than having a nicer newer ride. BTW, his montero has been solid, for the years that he has had it, from 110k to its current 160k. He did say that upgrading to OME suspension is a must.

 

[Jammer]

Thanks everyone for the advice and opinions. My credit union said the 2.99% didn't sound right as that year vehicle is listed for them at 10.99%

I left a message for the sales guy to explain their interest rate and revealed a little more truth to them...I was offered $25,700 at the local Toyota dealer for my Tacoma as a trade in.

Having called them out on the car being on ebay with a "best offer" option after being told repeatedly the price was firm. I also offered them a lowball from their asking price of $5000 otd for the Montero.

His reply was..."we don't try and make $3k on a $7k vehicle, and the Montero sold this morning."

HA!

 

[Martinjmpr]

If anything, I would say try selling the Taco yourself, either directly or to a dealer, before shopping for a new vehicle. The simpler you can make the transaction the better.

Sounds like you're looking to finance the "new" vehicle, since you don't seem to have a lot of cash on hand (if you did, I guess you could pay down the loan on the Taco.)

I think you're facing some sobering realities and you've got some difficult decisions to make. You can:

1. Do nothing and continue to make payments that deplete your monthly cashflow, making it difficult to get ahead and making it darn near impossible to save money. On the plus side, you have a **************', high-demand vehicle that - as long as you keep it in good shape - you will be able to sell when you get the inclination to do so (from what I've seen Toyota 4x4's are not as common in the South as they are in my part of the country, so they sell for top dollar there.) If your job situation is likely to get better (more pay) then this may be the option to go with. Grit your teeth and cut back wherever you can, figuring that when you get a little more money you may have more options.

2. Sell the Taco and then try to get another less expensive 4x4 with lower payments. This improves your cash flow but at the cost of a little peace-of-mind, as in, what happens if that long-out-of-warranty Montero or whatever has the transmission, T-case or head gasket go out? Now you are looking at a $3,000 repair on a vehicle you only paid $6000 for and that you are still making monthly payments on. Throw that repair bill on the credit card and you might end up paying 10-15% interest on it until you can get it paid off. Now that may not happen - vehicles these days are better than ever - but it's something you have to at least consider.

And then there's a third option that might seem painful but could work for you: Sell that albatross of a Taco, get the best price you can in the hopes that maybe you can eke out a couple thousand dollars profit. Then take that couple thousand, and if necessary, do a short term loan for another couple or three thousand (let's say $5,000 total) and get a Corolla, Sentra, or perhaps a simple 2wd pickup (get a Ford Ranger or Nissan Frontier to avoid the "Toyota Tax") and drive that until your financial situation improves. No payments (best of all) or minimal, short term payments (if you have to) plus more money in your pocket each month.

After years of only wanting a 4x4 and nothing else, this is similar to the situation I found myself in in 1999 when I was finishing college and beginning law school. I really REALLY wanted a 4x4, but I realized that a functional, reliable vehicle, even if it was 2wd, would be better for me in the short term. Also, you'd be surprised at how much fun you can have in a 2wd (especially in your part of the country where you certainly won't have to worry about driving to work on snowy or icy roads.)

 

[Xrunner]

Martin's above advice is spot on. If number 1 applies to you I would hang on to the Tacoma and look at cutting things like cable TV and Starbucks (just two random examples) to save money. You mentioned you like driving newer vehicles so definitely take a hard look at this option.

In regard to the third option I was in a similar situation while in college and was driving a Camaro. I desperately wanted a Tacoma but all I could afford without stretching too thin was a Honda Accord. It didn't take me long to figure out a front wheel drive car with a big trunk and manual transmission made for a lot of fun drives on curvy roads to great little camping spots. I probably had 100+ nights camping over the 120,000 miles I put on the Accord and still miss it sometimes. The 33mpg helped stretch my very limited vacation funds and the Accord ran like a top.

 

[austintaco]

In 1999 I did one of the worst things known to mankind. I traded in a 1995.5 Tacoma Ext cab 4wd SR5 with 50K miles for a Brand new 1999 Dodge Ram 4wd. It was the worst financial decision I ever made. When I decided to try and get on with the Fire Department, I had to rearrange my life. I had an accounting degree, but I had been working in the mortgage industry doing sales and my life reflected that. I had a big nice truck, but I had a big payment too. I was all show and no go. I sold the Ram for about $500 over what I owed, and went two states away to buy a 1989 SR5 4runner with low miles, but a bit worn cosmetically. I borrowed $3000 to get the truck, but I lost a $569 truck payment. I think my payment on the $3000 was $119, but I paid it off in 6 months. Now I was free of the monster car note, and I had a pretty reliable vehicle with no payment. I started reading up on the forums and I would replace and do maintenance items when I could (brakes, filters, plugs, etc....)
I got in to the fire department, kept driving the 89 for about 2 years, and then in December of 2003 I bought my dream truck, a brand new 2003 Tacoma Double Cab, and I still have it today with no plans to sell it anytime soon.

I have been in your shoes. You have a great truck now. At least you know that you can trust it, but it's an anchor. Unless you can substantially lower your payment with a refinance, you need to sell it. It's only short term. When you figure in your insurance and gas, your savings will be substantial.

A word of advice on wedding rings. Shop craigslist and pawn shops. Learn how to rate a diamond. Buy the nicest diamond you can and have it set in the ring of your choice. There's lots of guys out there holding on to engagement rings that didn't work out. It sucks, but they end up selling them cheap. I bought mine this way and we met at Jarrod's Jewelers and they confirmed that it was the ring he bought a few years before for $4500. I paid him $1400. Jarrod's valued it at $6K at that point.

 

[Jammer]

I hear ya! But for now (unless the dealer is continuing to lie to me) the monty is sold.

I already refi'd my taco and went from $447/mo and 5.25% to $372/month and 2.25%

I had originally financed for 72 months, already paid a year 8n and refi'd for 60 months. So I am still at the same length term but a bit less money.

I am an operations mgr at a $2.5mill+/yr very successful and growing bicycle shop. I live 15 miles away and can bike commute no problem. It will save me a minimum of $100/month in fuel costs plus make me drop much needed 'el bees'
And over all a better piece of mind.

sounds funny, but I have wanted a toyota p/u since I saw the 1st Back to the Future! Lol! And now I have one!

I really don't like being a bank slave and a materialist, but I do know quality and am willing to pay a luttle more for it.

Not saying the Monty would not have made a great vehicle or a good choice, just wasn't sold on the "deal" the banz dealer was presenting...and the decision was made for me...at least for now.

 

[Jammer]

P.S. I have fat fingers and thwy don't play well with thw Android keyboard so don't mind the mis-spelling!

 

[Martinjmpr]

In 1999 I did one of the worst things known to mankind. I traded in a 1995.5 Tacoma Ext cab 4wd SR5 with 50K miles for a Brand new 1999 Dodge Ram 4wd. It was the worst financial decision I ever made...

Yes, this is the dark side of "easy credit."

I also wonder if this may be a side-effect of the overall improvement in vehicle longevity and quality?

Think about it: Back in the old days, finance companies had to be a little bit more careful about who they allowed to finance a vehicle. Vehicles didn't last as long as they do today and the finance company didn't want to be in a position of having a borrower default on a loan and then the finance company would have to sell a repo'd vehicle at a significant loss and then try to come after the borrower for the remainder (which often cost more than it was worth.)

But the improving quality and longevity of vehicles means that finance companies can make riskier loans, knowing that even in a worst case scenario, they will be stuck with a repo that they can either break even on or possibly even make a small profit on, due to the huge demand for late model vehicles (especially vehicles like the Tacoma or FJ Cruiser.) Even if they take a loss, that loss may be more than offset by the fees they've already earned by writing the loan, or the loan itself may be sold immediately (at a discount) to an investor.

Either way, the company that offers the "easy credit" doesn't give a rip about your monthly cash flow or how likely it is that you'll eventually be in a position where the vehicle is a burden on you. They get their money up front and what happens years later doesn't matter to them.

I know there are people on ExPo who will vehemently disagree with me (and have), but I still think that for a majority of buyers, it rarely makes sense to buy new, especially if you're young and just getting started in your career and are in a relatively low paying job.

I know, I know. "I crunched the numbers." "The used market in [state, county. province, etc] is insanely high." "Since I'm planning on keeping this vehicle, it makes sense to buy new" "The dealer offered great financing" "This way I can get exactly what I want and know it was well treated" etc etc.

Call me cynical, but all of those things sound to me like someone who is trying to talk himself into something he knows is unwise. Having a $500+ vehicle payment that can stretch as long as 7 years is just a huge burden that IMO should only be taken on if you really understand what it will do to your life.

Unfortunately, this is one of those lessons that people often have to learn by experience.

 

[Martinjmpr]

I hear ya! But for now (unless the dealer is continuing to lie to me) the monty is sold.

Well, IMO you dodged a bullet.

And remember, there's ALWAYS another deal out there. ALWAYS.

 

[Jammer]

Having sold cars for 3 years I am well aware of "the game" and if anything it has taught me how to not get screwed. Sometimes emotion clouds judgement, and I am of the mindset of only buy new if it makes sense.

E.g. my girlfriends growing problem of a 2004 MB c230 coupe..warranty was up we got a killer deal on it as a CPO and VW was offering 0% on remaining 2010 MKV Jetta's.

Knowing german cars fairly well, it was time to jump ship on the c230.

The Jetta has been virtually flawless after 45k and we will continue to drive it until it proves to cost more than its worth.

I bought the taco on a whim since I have always wanted one and never really liked the Colorado (although never had an issue with it and drove it hard, just ugly IMHO with poor resale).

I was looking for a quick fix and the ExPo crowd has yet to let me down...on anything!

The stars were aligned so to speak and I still have the taco. Hopefully I can make it work and it be on the road for many 100k's miles!

 

[austintaco]

I am an operations mgr at a $2.5mill+/yr very successful and growing bicycle shop. I live 15 miles away and can bike commute no problem.

I knew there was something else I liked about you. I used to work at a shop too, and some of my best friends locally are the bike shop crew at one of the many local bike/tri shops here in Austin. Great gig. Great industry too.

With the refi and payment you have now, I think paying on the Tacoma is the safe bet. By bike commuting, you'll also be saving the life of the Tacoma at 30 miles per day.

 

[Jammer]

Yeah, I bought a Specialized AWOL Comp and am slowly preping it as my do all/be all machine. I need to loose the weight and once I get trough the procrastination and get on it towards the shop in the morning, it truly is Zen...aside from the ************** that can't drive.

I live in a huge "Tri/roadie" area, but am more of a bicycling for the sake of bicycling than I am a competitor.

I used to own a nice Trek Madone, but never could get into the competitivness of this area. I juat like having fun riding.

I've got an extra set of stans 29r wheels I can throw on the awol if I want to hit the mild local trails.

My degree is in MIS, but I have almost always worked in the out door industry in some capacity.

Hence the need/love for a great 4x4 and the drive for exploration.