Gale Hawkins wrote: Some prefer to pay then play. Some prefer to play then pay. Times like these can be defining moments as to which group we are in. One can only be upside down if he chose to play then pay. In 2017 I will be able to sign up for SS and Medicare so threads like these can hit home hard and be a way to learn from the experiences of others.
Agreed.
We are in the perfect storm in our economy, inflation is way up, real estate values and re-sale have tanked, wages are declining, consumer debt is way up, gas-hog trucks, cars and RV sales have tanked, gasoline and diesel are off the charts, and interest rates on savings are close to zilch......"defining times" are right, Gale. Risk on debt is rampant, bankruptcies, home, RV manufacturers closing and auto plants closing seal the case
This isn't doom and gloom, these are just the facts.
It is obvious that most of the posters other than skid row joe and a few others do not have clue about how financing works. They have fooled themselves into believing that 0% financing is the way to go. NOT. Do you think that the dealers are giving away money. You are paying the financing costs . It is buried in your trade and the purchase price. The term upside down has traditionally been used for buyers who have financed a vehicle. They decide to trade and the unit is worth less than what they owe. This usually happens to the fools who put next to nothing down and finance over 20 years. This thread has applied the term upside down incorrectly. Every thing you buy from a stereo to a washing machine is worth less than what you paid for it. They are all depreciating assets not investments. Those who are truly upside down and need to sell are in for a shock. If they bought a 40 ft. 4 slide unit 2 years ago, put a few thou down and took the never pay plan ( 20 years) how are they going to get out from under?? Prices are falling much quicker than 2 years ago. There are few buyers unless it is a steal. This fool will have to sell it for maybe 40 to 50% of new price and get a loan for the difference. Try these figures
new price $300,000
cash buyer or good down with a 5 to 7 year loan gets 25 %
cash price $225,000
after one year depreciates to say $195,000
2nd. year $175,000
factor in the bad market and it might get $150,000. If he put say $40,000 down then he would get more than he owes.
The 20 year loan guy did not get any big discount. lets give him 15 % even though it was less. He paid $255,000. Probably owes $235,000. He is short to the tune of $85,000.
If you cannot afford to pay for a MH then stamp collecting should be your hobby of choice. Nothing wrong with some financing but not the whole amount. Just think many of those full body paint fancy units you see will never be paid for!!!!
I may be a fool, but not one who plans on being parted from his money.
___________________________________________
08 Holiday Rambler Vacationer 38PLT Workhorse UFO GAS Pusher Chassis
06 Saturn Vue toad, SMI Breaking sys,Blue Ox tow bar. Myspace site and blog
Gramps and family Drive a UFO.com
Buy something for $50,000 and then after a period of time need or desire to sell it. Unit in question is worth $30,000 at that time.
You owe $40,000 on the unit.
However, when you bought the "something" you had $50,000 cash sitting in your savings account.
Question becomes ---- you sell the unit then for $30,000 ------- do you have enough assets to make up the difference in what you owe at the time of sale????
Guess I don't really feel someone is "upside down" on anything when one's liquid assets are sufficient that the unit can be sold and the total owed balance paid for upon sale.
Personal losses --- now that it a whole different issue.
On our present coach we owe "nothing" at all to anyone. Title is in our safe. However, what we paid for the coach and then what we paid to repair and improve the coach over the past 3 or 4 years is something different. Present average retail on our coach is low $40's and the total money put into her is close to double that.
Actually should we sell our coach for $40,000 we will show a loss of close to $40,000 and that is for 4 years. Cost of ownership - $10,000 a year plus insurance, fuel, oil and etc.
Is $10,000 a year an acceptable loss on enjoying yourself and family enjoyment for those 4 years? I think so.
Compare that to a new coach - buy for $250,000 and drive it home and enjoy the view of a brand new coach sitting in your driveway now worth substantially less than $200,000 - is this acceptable? Depends upon way too many things for one to judge by the casual. However one that does this has just lost more $$$ in a few hours of depreciation - than I have in 4 years...
God Bless
Bill
Upside-down is when you owe more on your coach than it will garner in a sale. I have a hard time believing that your 15 year old coach will bring $42,000 anywhere today. I believe you would get a true trade-in nearer to $10,000 tops. You won't know the true number until you bring it into the deal after getting the best deal on your next coach.
There is no comparing your 15 year old paid for coach with a new $250,000+- coach driven off the lot at any price. Depreciation is generally 50% inside of two years. I bought a 9-month old pristine, loaded, used coach for -25% off what the new owner paid just 9-months before I bought it from him. I would never buy a new anything......too much of a hit putting you in-the-hole right off the bat. It is far better to buy used, regardless of how gently used it is. RVs are a dime-a-dozen, all RVs, none escape the depreciation game, even your 15 year old coach.
Bill, I would suggest you try testing the water by placing a few free ads around the Internet to see how fast someone will give you $42,000 for your coach, I believe you will get a wake-up call on it's true value to the next buyer.
Good Luck!
Skid row
I'm certainly not that foolish, as to expect to garner $42 k for my coach. I am fully aware of the price I paid for it - the money I put into it - and depreciation on it from the git-go.
What I was posting is a direct printout from NADA - that's all.
Nearly anyone knows that his/her coach is only worth whatever someone "else" is willing to pay you for it - period.
God Bless
Bill
Bill W. Trammell
Wife - Judy
2001 Monaco Dynasty Chancellor
2008 Malibu 2LT toad
I don't think the OP was asking if folks should finance their purchase. He only asked how many were upside in their MH ownership. If you are not, then this thread doesn't apply to you.
Paul and Karen
New to us 93 Pace Arrow
01 Tracker Toad
sepisllib wrote: I'm certainly not that foolish, as to expect to garner $42 k for my coach. I am fully aware of the price I paid for it - the money I put into it - and depreciation on it from the git-go.
What I was posting is a direct printout from NADA - that's all.
Nearly anyone knows that his/her coach is only worth whatever someone "else" is willing to pay you for it - period.
The only reliable number for your coach would come from an RV sales professional. It's likely worth closer to $10K than $42,000.
Only a professional RV dealer can give you a firm-price in today's market environment, not NADA.
moisheh wrote: It is obvious that most of the posters other than skid row joe and a few others do not have clue about how financing works. They have fooled themselves into believing that 0% financing is the way to go. NOT. Do you think that the dealers are giving away money. You are paying the financing costs . It is buried in your trade and the purchase price. The term upside down has traditionally been used for buyers who have financed a vehicle. They decide to trade and the unit is worth less than what they owe. This usually happens to the fools who put next to nothing down and finance over 20 years. This thread has applied the term upside down incorrectly. Every thing you buy from a stereo to a washing machine is worth less than what you paid for it. They are all depreciating assets not investments. Those who are truly upside down and need to sell are in for a shock. If they bought a 40 ft. 4 slide unit 2 years ago, put a few thou down and took the never pay plan ( 20 years) how are they going to get out from under?? Prices are falling much quicker than 2 years ago. There are few buyers unless it is a steal. This fool will have to sell it for maybe 40 to 50% of new price and get a loan for the difference. Try these figures
new price $300,000
cash buyer or good down with a 5 to 7 year loan gets 25 %
cash price $225,000
after one year depreciates to say $195,000
2nd. year $175,000
factor in the bad market and it might get $150,000. If he put say $40,000 down then he would get more than he owes.
The 20 year loan guy did not get any big discount. lets give him 15 % even though it was less. He paid $255,000. Probably owes $235,000. He is short to the tune of $85,000.
If you cannot afford to pay for a MH then stamp collecting should be your hobby of choice. Nothing wrong with some financing but not the whole amount. Just think many of those full body paint fancy units you see will never be paid for!!!!
gramps: You are way off base on this one.
Moisheh
Agreed, Mr. Moisheh.
0% financing works out to an average of 10% more being upside-down from day one, until the 60th payment. It's delusional to think you're "making money by financing" being that far upside-down, as some have posted.
I don't know anyone that came out on financing and making payments every month. It just doesn't work that way.
moisheh wrote: It is obvious that most of the posters other than skid row joe and a few others do not have clue about how financing works. They have fooled themselves into believing that 0% financing is the way to go. NOT. Do you think that the dealers are giving away money. You are paying the financing costs . It is buried in your trade and the purchase price. The term upside down has traditionally been used for buyers who have financed a vehicle. They decide to trade and the unit is worth less than what they owe. This usually happens to the fools who put next to nothing down and finance over 20 years. This thread has applied the term upside down incorrectly. Every thing you buy from a stereo to a washing machine is worth less than what you paid for it. They are all depreciating assets not investments. Those who are truly upside down and need to sell are in for a shock. If they bought a 40 ft. 4 slide unit 2 years ago, put a few thou down and took the never pay plan ( 20 years) how are they going to get out from under?? Prices are falling much quicker than 2 years ago. There are few buyers unless it is a steal. This fool will have to sell it for maybe 40 to 50% of new price and get a loan for the difference. Try these figures
new price $300,000
cash buyer or good down with a 5 to 7 year loan gets 25 %
cash price $225,000
after one year depreciates to say $195,000
2nd. year $175,000
factor in the bad market and it might get $150,000. If he put say $40,000 down then he would get more than he owes.
The 20 year loan guy did not get any big discount. lets give him 15 % even though it was less. He paid $255,000. Probably owes $235,000. He is short to the tune of $85,000.
If you cannot afford to pay for a MH then stamp collecting should be your hobby of choice. Nothing wrong with some financing but not the whole amount. Just think many of those full body paint fancy units you see will never be paid for!!!!
gramps: You are way off base on this one.
Moisheh
Sorry but gramps isn't off base...Don't you seem to understand that financing or paying cash is a separate decision than the negotiation to buy process...I bought mine and negotiated a better deal (because I was willing to walk away) than a person who bought the same coach a couple of weeks after I did and he paid cash and I financed...I got 26% off and he got 21%...Further the cash he paid is dead money that is unavailable to earn anything for him...while mine is...Over the 1st 2 years I was up a net $16,000 on just the amount of capital required to pay the coach off, which more than offset my interest that you are so afraid of...
If you truly understood financing, you would have at least done an analysis of your situation, and could defend it based upon the results...Instead like a lot of cash buyers...you choose to accept that as the only way for everyone...
Granted there are many individuals who get in over their head in financing things, but there are many people who pay cash for things they really don't need or can afford as well...
I would never tell someone that financing was the only way to go...because for them it may not be...but I wouldn't tell anyone to pay cash always either...because that is sometimes poor money management...
Each person should take the time to set down with pen and paper and layout both sides of the issue...they might just surprise themselves with the results.
Financing has never been a problem for me, because I choose what to finance and the true costs and what to pay cash for and its true cost...If a person uses credit card and analysis it, it should always come up on the cash side because of the high interest..but a 5.75% loan that I have on my MH can easily be covered by the compounding of interest I derive by investing wisely...
Gary And Cathy
'05 Dolphin 5342
Honda Element following us
GS, FMCA 365597 Rallys attended FMCA Albany, Or.'06 FMCA Redmond, Or.'07
The only time 0% is 0% is when you pay cash for it.
2005 Chev 5.3 Supercharged 395HP 425 T hp. Two wheels on front, 2 on back. one seat, tint windows. front and rear bumpers, headlights, windows. Door on each side. Heater, floor mats, junk behind seats, some dirt. Pulls so hard.
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