Results 1 to 13 of 13

Thread: My car insurance!

  1. #1
    Featured Member lolagetz's Avatar
    Joined
    Apr 2006
    Location
    Southern California
    Posts
    865
    Thanks
    0
    Thanked 9 Times in 8 Posts

    Default My car insurance!

    It went down $200 ($1200 to $1000 for 6 months) since I paid off my car!! Woohoo! I kept all the same coverage, except I took of the Loan Payoff coverage, since I won't be needing that anymore.. I knew I would save a couple of bucks with that, but not $200! Yay! Moral of the story: girls, pay off your car loans!

  2. #2
    God/dess
    Joined
    Jul 2005
    Posts
    4,704
    Thanks
    3
    Thanked 8 Times in 8 Posts

    Default Re: My car insurance!

    I can't wait, I've only got a few thousand to go, and I get cheap insurance!!!!!

    Congrats!

  3. #3
    PhillyDancer1982
    Guest

    Default Re: My car insurance!

    Quote Originally Posted by lolagetz View Post
    It went down $200 ($1200 to $1000 for 6 months) since I paid off my car!! Woohoo! I kept all the same coverage, except I took of the Loan Payoff coverage, since I won't be needing that anymore.. I knew I would save a couple of bucks with that, but not $200! Yay! Moral of the story: girls, pay off your car loans!
    I can't wait to pay off my car loan! I owe less than $9000 and I'm planning to have it all paid off by Halloween of this year(i.e., in less than half the time of its 6yr loan term). I hope my insurance goes down as a result, but I doubt it, since I don't think I have Loan Payoff coverage...unless it is something automatically added on for any car covered by a loan?? IDK but I'd love to hear feedback on this.

    My insurance is already fairly cheap -- I'm paying less for full coverage on my 06 Mustang GT, than I was paying 3-4yrs ago for min coverage on a 73 VW! -- but I always want it to be cheaper!

    Congratulations to you on paying off your car loan, by the way.

  4. #4
    Banned Melonie's Avatar
    Joined
    Jul 2002
    Location
    way south of the border
    Posts
    25,932
    Thanks
    612
    Thanked 10,563 Times in 4,646 Posts
    Blog Entries
    3
    My Mood
    Cynical

    Default Re: My car insurance!

    IMHO auto loans are about as bad as it gets in terms of a 'negative' investment. Unless you have a primo credit rating, the interest rates are somewhere between 'bad' and 'loanshark'. The interest payments are NOT tax deductible. The value of the 'asset' you just purchased via the car loan declines in value almost as fast as the outstanding loan balance. In some cases, the value of the 'asset' declines FASTER than the outstanding balance of the car loan, at which point you will be forced to spend extra money to purchase 'gap' insurance to cover the lending bank's loan. Additionally, the lenders almost always require that you also purchase expensive 'comprehensive' car insurance to cover their own asses if your (their) vehicle should get messed up in a car accident that you could not afford to have completely repaired right away. So if you add up all of the interest charges, all of the extra finance charges, all of the extra insurance charges, you wind up discovering that the $25k new car you are thinking about buying will actually cost you close to $40k ... and will probably be worth $10k or less by the time you pay off the auto loan and actually become the owner of the vehicle.

  5. #5
    PhillyDancer1982
    Guest

    Default Re: My car insurance!

    ^ Melonie, you raise a great point when you mention that most people will need to buy gap insurance. However, I was subservient enough to sign up for gap insurance when I purchased my car at the Ford dealership, and I really regret doing this. The reason why is because I put down a decent down payment and I was paying $1500-1700/mo on my car loan at least for the first half year or so...which meant that I was only "upside down" for a few months, but I'm stuck paying $15/mo for the duration of the 6yr loan. I woulda been better off researching the approx car loan value after depreciation, and putting the difference in a savings account in a bank, to use in case I got into an accident!...and that's considering that I have a good driving record(I understand that a lot of accidents are unforseen and can occur at any time, but just mentioning that it's not like I was planning to be reckless or anything).

    I think gap insurance is more necessary for some folks than others. My roommate Revolution didn't buy gap insurance on his used Hyandai, mostly because he could tell that the dealer was being all slick about it and not clearly answering all his questions about it. I think the dealers try to make gap insurance seem like this necessary godsend so that the people who don't have a big "need" for it will buy it anyway.

  6. #6
    Banned Melonie's Avatar
    Joined
    Jul 2002
    Location
    way south of the border
    Posts
    25,932
    Thanks
    612
    Thanked 10,563 Times in 4,646 Posts
    Blog Entries
    3
    My Mood
    Cynical

    Default Re: My car insurance!

    ^^^ these days it's 'academic', because auto lenders will run the math on down payment vs length of loan vs projected vehicle depreciation and will now REQUIRE the borrower to purchase gap insurance if any part of the depreciation curve would put the loan balance versus resale value underwater.

  7. #7
    PhillyDancer1982
    Guest

    Default Re: My car insurance!

    ^ Really? I did not know that it was now a "requirement." If anything, I feel that my gap insurance was essentially useless because of the tiny amount of time during my loan term that I could have effectively used it if I'd gotten into an accident. But then again, I was making large payments on the car, so that's why.

    Is the requirement concerning gap insurance recent or has it been around for a while?

  8. #8
    Banned Melonie's Avatar
    Joined
    Jul 2002
    Location
    way south of the border
    Posts
    25,932
    Thanks
    612
    Thanked 10,563 Times in 4,646 Posts
    Blog Entries
    3
    My Mood
    Cynical

    Default Re: My car insurance!

    ^^^ recent ... as 'subprime' mortgage problems have begun to spill over into car loan defaults and bankruptcies.

  9. #9
    God/dess VenusGoddess's Avatar
    Joined
    Oct 2003
    Location
    Home
    Posts
    13,598
    Thanks
    0
    Thanked 28 Times in 23 Posts

    Default Re: My car insurance!

    If you are going to buy a brand-new car and you are still financing that car...it would be wise to get gap insurance. Why? Because if your car is totaled in an accident, then the value of the car is lower than the financed value of the car and YOU are responsible for the difference whether the accident was your fault or not.

    I have a friend who's car was completely totaled in a parking lot by a drunk driver driving like an ass in the winter time. He had his car for 1 year and had bought it brand new. It was a Ford. The difference between the current value of the car and the loan amount was $4500. May not sound like a lot...but when you get a check from the other guy's insurance company for $16,000 and you still have to come up with an additional $4500 AND another down payment for a new car, that can be a lot.

    I would rather carry gap insurance and know that no matter what happens, I'm covered. I would just hate to see myself in the same situation that my friend was in because that sucks.

  10. #10
    PhillyDancer1982
    Guest

    Default Re: My car insurance!

    ^ Yes and that is why gap insurance is good and necessary in most "new car" purchase scenarios, but it was a rip off for my situation. I was only upside-down on the loan for a few months into the loan because I was paying large chunks towards my car loan each month. I would have been better off putting the difference b/t the loan balance + car value into a savings account in case I needed it. So even though it's been a long time now since I've actually NEEDED the gap insurance(i.e., owing more money than the car's value), I'm STILL paying each month for it until the loan is paid off because there's no way I could cancel it. I'm paying off the car before the 3yr mark, yet I'll be stuck paying for 6yrs of gap insurance payments along the way. Doesn't make the most sense for my situation, you know? At least I know for next time. My friend Revolution avoided purchasing gap insurance for his car because he was in a similar spot.

  11. #11
    Banned Katrine's Avatar
    Joined
    Nov 2003
    Posts
    13,855
    Thanks
    0
    Thanked 0 Times in 0 Posts

    Default Re: My car insurance!

    Dude, if you have a loan on a car, get the comprehensive. I know someone who thought she was too smart for it, and now owes $9K on a totalled car!

    "Have you ever been to American wedding? Where is the vodka, where's marinated herring?" - GB
    "And do the cats give a shit? No, they do not. Why? Because they're cats."-from The Onion

    Quote Originally Posted by Mia M
    If a cupcake was tossed at me... well, I'd only be upset if it missed my mouth

  12. #12
    PhillyDancer1982
    Guest

    Default Re: My car insurance!

    Quote Originally Posted by Katrine View Post
    Dude, if you have a loan on a car, get the comprehensive. I know someone who thought she was too smart for it, and now owes $9K on a totalled car!
    Wait I thought it was mandatory to get all 3 categories of coverage of car insurance for a car that's being financed...or is that only in PA? I'm not sure. I do know, however, that my car loan(through Bank of America) requires all 3 categories.

    I think most banks require you to get collision and comprehensive along with the state's min liability, so that they can avoid situations like the one that your friend got into. Could you imagine how hard it would be for a bank to try and get $9K from most people that don't even have the car to show for it?...I can imagine it'd probably be worse than pulling teeth.

  13. #13
    God/dess VenusGoddess's Avatar
    Joined
    Oct 2003
    Location
    Home
    Posts
    13,598
    Thanks
    0
    Thanked 28 Times in 23 Posts

    Default Re: My car insurance!

    I think most banks require full coverage (comprehensive, collision, etc). Gap insurance is something totally different and if you are taking out a loan on a car, I would strongly advise you buy it.

Similar Threads

  1. Car Insurance
    By Miss_McKenna in forum The Lounge
    Replies: 15
    Last Post: 04-08-2009, 11:05 AM
  2. Car Insurance
    By PrettyCurlieQ in forum Dollar Den
    Replies: 7
    Last Post: 06-25-2008, 10:51 AM
  3. car insurance
    By Corgan in forum Dollar Den
    Replies: 6
    Last Post: 10-30-2007, 01:46 AM
  4. car insurance Q
    By TigersMilk in forum Dollar Den
    Replies: 21
    Last Post: 04-26-2005, 10:46 AM
  5. new car insurance
    By Lena in forum Dollar Den
    Replies: 14
    Last Post: 09-30-2004, 07:52 PM

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •