Which Car? New or 2nd hand?

Paul_S said:
Assuming insurance is R500 per month, term is 6 years and interest is prime:
- R2500 can purchase a R110K vehicle with no balloon or residual payment.
- R2500 can purchase a R130K vehicle with a 30% residual (R42K)

However having to refinance R42K after paying for a solid 6 years is nuts IMO.
Play around: https://www.wesbank.co.za/WesBankCoZa/calculators/vehiclerepayment/index.jspx?siteID=wesbank
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Since it's he's first purchase he says that he probably would get a higher interest rate. 60 for a new and 48-54 for a 2nd hand. We been playing with the calculator.
 
You lose more on a new car than on a second hand car. I recently purchased a second hand Opel Corsa for 119,000 and I had it evaluated by a dealer for 120,000. I bought a near bargain, as I bought it 3 months ago. If he buys a new car, the moment he drives it off the floor, he can deduct at least 20% off of it's value. New cars are for the rich or those who receive car allowances.

I drive a 2010 Opel Corsa Essentia. Phenomenal car. You can get them for around 114 - 120k second hand. Awesome vehicle. Light on juice, refined, loads of extras, safety features. You won't win any races in it, but nowadays who can afford to burn fuel?
 
So my brother don't see nothing wrong with residual as he sees that he can refinance the amount, he says that's no prob with him paying extra or trade/sell the car to settle and most probably gain a lil.
 
Oh btw, he's asked mom to finance the car for him, can he then later after 5 months transfer/take over from her without any issues?
 
Khanya said:
So my brother don't see nothing wrong with residual as he sees that he can refinance the amount, he says that's no prob with him paying extra or trade/sell the car to settle and most probably gain a lil.
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I lol'd.

Tell your brother "good luck, have fun!"

He's going to be one unimpressed dude when he has to cough up R1.2k for insurance every month though. Keeping up with the Joneses is an expensive thing to do. Just putting it out there.
 
Oh yeah, feed-back, he went for a new Vivo (R110k), pays R2.3k with insurance, that's with R20k deposit and R30k residual. Think he's gonna be bitten?
 
Thats a decent deal.... and no keeping up with the Joneses needed, plus that residual should be manageable come the end of the term
 
Voicy said:
Whatever you do, don't let your bro buy from VW Barnes.

New is nice for a month. Then it's a 2nd hand car for all intents and purposes - but you sit with the payments. Residual is just another way of saying "I'm buying a car I can't afford."

The fiestas are really awesome. I personally drive an opel Corsa 1.8 GSi so I'm biased towards opel (previous car was a 1.6 GSi). Stay away from french cars if you don't have a budget and no stress about parts taking FOREVER.

Tell your boet to face reality...if you don't have cash for fancy cars (remember to factor in insurance / maintenance costs) then don't buy it!
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Please listen to the man. besta advice. Read this and didnt really know what to say.

Residual: DO NOT buy on Residual, If he does not ahve the money now than he might niot have the money than, period.

Buy a new car if he gonna keep it at least 3-4 years past its last payment date on finance as thats when the car really shows its worth as you have freehold transport and the money that would have went to pay for a car can for for something else, especially if you earn a small salary.
 
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