Am I ripping my friend off?
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This is a discussion on Am I ripping my friend off? within the Car Purchasing Forum forums, part of the ClubWRX.net Marketplace category; My friend owns a 2011 WRX (Premium Trim) with about 43,000 miles on it. It has a dent and subsequent ...

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    Am I ripping my friend off?

    My friend owns a 2011 WRX (Premium Trim) with about 43,000 miles on it. It has a dent and subsequent rust spot on the hood from a low speed run-in with a trailer hitch, and a piece missing from the front grill from an ill-advised off road excursion taken to avoid a rear ending incident. It is otherwise in very good condition inside and out. I know he broke it in properly, I know he gets it maintained on schedule. I know it has been driven properly. It's a wonderful car, but he's looking to get out from under a bad loan and start fresh, possibly with a 2015 WRX.

    I'm looking to buy, and I've been test driving the likes of brand new Civic's, Mazda3's, Hyundai Elantra's, etc. With the exception of the 3, all are complete snores but fine point a-b rides that are trouble free for several years at least.

    That's where we intersect. He has a very fun car that I'd love to have, and he's looking to start fresh. He owes about 17,700 on his loan, giver or take a couple hundred. I broached him on the subject of acquiring his car having been pre-approved for $20,000 from my bank before I started shopping. I wasn't sure what number he'd throw at me, but he said he'd sell me his car for what he owes.

    Now we're best friends, and we often buy each other things with no expectation of reciprocation, but I don't want resentment or regret to sully a friendship. That seems like a very, very cheap price to sell that car for, even if you account for a friend and family discount. That seems nearly 4,000 short. I can't afford his car at $4000 more, which I think he knows, but I still might try anyway.

    He keeps telling me its all good, and no worries, and whatnot. But I don't want to flat out rip the man off. Is 18k for the car described just a really really good deal, or highway robbery?

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    mrd
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    He would get less money for trade in.

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    He simply abides. SD_GR's Avatar
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    It is possible this won't end well.

    However I don't know, because I don't understand. Specifically I did not think it possible to get out of a bad loan on an older car and start fresh on a new car. I thought that meant more bad money.
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    Quote Originally Posted by SD_GR View Post
    It is possible this won't end well.

    However I don't know, because I don't understand. Specifically I did not think it possible to get out of a bad loan on an older car and start fresh on a new car. I thought that meant more bad money.
    Yep.. even if you're able to get a significantly better interest rate (which could be a motive) you still have the issue of negative equity. The only way to mitigate that is to add cash to the deal. Otherwise there is no erasure or starting over because without bringing cash to the deal you are typically merely acquiring greater negative equity (even if you get a newer care for similar payments).
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    Quote Originally Posted by SD_GR View Post
    It is possible this won't end well.

    However I don't know, because I don't understand. Specifically I did not think it possible to get out of a bad loan on an older car and start fresh on a new car. I thought that meant more bad money.
    He's paying about $600 a month due to an upside down trade-in for his current car. $600 a month (while admittedly over a longer period) could buy much more car. Or more to the point, one could get a good car for far less per month (though, again, over a longer period).

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    Quote Originally Posted by TheJ View Post
    Yep.. even if you're able to get a significantly better interest rate (which could be a motive) you still have the issue of negative equity. The only way to mitigate that is to add cash to the deal. Otherwise there is no erasure or starting over because without bringing cash to the deal you are typically merely acquiring greater negative equity (even if you get a newer care for similar payments).
    He's okay with that if it means a car that better meats his needs.

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    The Guy On The Couch TownLine500's Avatar
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    Quote Originally Posted by Wildside50 View Post
    He's paying about $600 a month due to an upside down trade-in for his current car. $600 a month (while admittedly over a longer period) could buy much more car. Or more to the point, one could get a good car for far less per month (though, again, over a longer period).

    Wow! I thought my buddy was paying a lot at $495 per month. Mines a 13 with 6700 miles. I pay $350 per month.
    SD_GR and TheJ are right about negative equity, he's in so deep that even if you bought his car for $18000 that would only clear his existing loan. He would still need a decent down payment on a 15, and he better have a great credit score.
    If you guys are that good friends. And something bad happens to car, it could really derail your friendship. I won't sell cars bikes or atvs to friends or family. You really never know what might happen. On the other hand it could be the deal of your life. Just my 2 cents. Just tread carefully.
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  9. #8
    He simply abides. SD_GR's Avatar
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    So he's in this bad loan because he made a previous mistake on a prior loan? It's time to rethink loans.
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    I lied. I cheated. I bribed men to cover the crimes of other men. I am an accessory to murder. But the most damning thing of all... I think I can live with it. And if I had to do it all over again - I would. Benjamin Sisko
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    Quote Originally Posted by SD_GR View Post
    So he's in this bad loan because he made a previous mistake on a prior loan? It's time to rethink loans.
    Okay insult my friend with no information. That's helpful to anyone. Thank you.

  11. #10
    Registered User codered2323's Avatar
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    I say, do what you can to help your friend. If he's cool with selling you that car, then yeah why not? You're both adults and can handle speed bumps 👍

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    He simply abides. SD_GR's Avatar
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    Quote Originally Posted by Wildside50 View Post
    Okay insult my friend with no information. That's helpful to anyone. Thank you.
    The statement is based on information you have provided.

    Based solely on the info you've provided I'd not do this whether I were in your position or your friend's.

    Good luck nonetheless and hopefully it works out.
    WRX Info Links, Courtesy TheJ
    Man is a brute.... If you're cruel to him, he respects and fears you. If you're kind to him, he plucks your eyes out. Alexis Zorbas
    I lied. I cheated. I bribed men to cover the crimes of other men. I am an accessory to murder. But the most damning thing of all... I think I can live with it. And if I had to do it all over again - I would. Benjamin Sisko
    DISCLAIMER: Opinions expressed are the author's alone and are inherently worthless.

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    Registered User OleDB's Avatar
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    Negative equity is where car dealerships make their money. The rape u on trade ins then never want to budge on the actual price. Me i internet shop to get the best price then never trade in. My 15 base is just south of $400 a month 0 down

  14. #13
    Registered User OleDB's Avatar
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    Sorry ignores your question. Your friend shot the price to you. Let him think it over then if he's fine with it do it. Give him a chance to see what they will give him trade in. My guess is they are trying to low ball him. So honestly it works for him. New car no negative equity and no more $600 car payment. Trust me I've made money mistakes and had a similar car note. Bought sense is the best sense.

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