2019 JLU Sahara depreciated 42% in 10 months

[ThirtyOne]

Factory options increase its resale value..heck you talking about lol

Your replies are very entertaining keep em coming

Here is an example using NADA values for the numbers.

Spec'd out 2 vehicles. Both new prices and used with 30,000 miles

low spec - Just auto and hard top:
MSRP new: $42,985
Used: $33,800
Depreciation: 21%

high spec - 2.0L, auto, upgraded wheels, leather, cold weather, dual top body color, infotainment, led, safety, trailer, selec-trac, anti-spin,
MSRP new: $55,340
Used: $37,125
Depreciation: 33%

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[KnG818]

Here is an example using NADA values for the numbers.

Spec'd out 2 vehicles. Both new prices and used with 30,000 miles

low spec - Just auto and hard top:
MSRP new: $42,985
Used: $33,800
Depreciation: 21%

high spec - 2.0L, auto, upgraded wheels, leather, cold weather, dual top body color, infotainment, led, safety, trailer, selec-trac, anti-spin,
MSRP new: $55,340
Used: $37,125
Depreciation: 33%

But again, why are you factoring in the MSRP?? Who cares about msrp. Msrp is a bone the manufacturer throws the salesman.

It's the invoice you need to be focused on. The msrp could say 1million dollars - means nothing.

Look at the numbers you just posted but ignore both msrps. The high spec vehicle is worth more.

Msrp is a "suggestion"...means absolutely nothing.

 

[Gellie]

Guys its VERY simple. Depreciation = the price you pay minus the price you receive. MSRP/Invoice meaningless for real world numbers

 

[ThirtyOne]

The bank gives you the loan and retains the title, but you own it. If you default in payments, yes, they will repossess it but you own any equity.

For example: I owe $23k on car loan. Bank repos the Jeep and sells at auction for $33k...I get a check for $10k(minus all penalties and fees). I own the equity.

Or vise versa if you owe more than the cars current value (or final auction selling price. You will still owe money.

If your leasing and it gets repoed it's all a loss. Regardless.

It is entirely different than leasing. Totally diff animal.

I didn't say it was identical. There are some differences in the event of being totaled or reposessed where you cannot exercise your buyout. But those are different scenarios than what the OP was talking about.

Besides, why would anyone default on a vehicle where they have positive equity? They could sell it themself and pay off the debt.

 

[Gellie]

I didn't say it was identical. There are some differences in the event of being totaled or reposessed where you cannot exercise your buyout. But hose or different scenarios than what the OP was talking about.

Besides, why would anyone default on a vehicle where they have positive equity? They could sell it themself and pay off the debt.

Always a bad idea to put down any money on a lease or loan. If the car gets stolen or totaled you would most likely get clipped for any" positive equity" you have in the car.

 

[ThirtyOne]

But again, why are you factoring in the MSRP?? Who cares about msrp. Msrp is a bone the manufacturer throws the salesman.

It's the invoice you need to be focused on. The msrp could say 1million dollars - means nothing.

Look at the numbers you just posted but ignore both msrps. The high spec vehicle is worth more.

Msrp is a "suggestion"...means absolutely nothing.

Technicality. here is the same math at 5% below invoice:

Spec'd out 2 vehicles. Both new prices and used with 30,000 miles

low spec - Just auto and hard top:
5% below invoice new: $38,818
Used: $33,800
Depreciation: 13%

high spec - 2.0L, auto, upgraded wheels, leather, cold weather, dual top body color, infotainment, led, safety, trailer, selec-trac, anti-spin,
5% below invoice new: $49,268
Used: $37,125
Depreciation: 25%

 

[ThirtyOne]

Always a bad idea to put down any money on a lease or loan. If the car gets stolen or totaled you would most likely get clipped for any" positive equity" you have in the car.

Right.

That was not the scenario we were discussing but that is true.

The scenario the OP raised was trading a vehicle and someone said you can't have equity in a lease.

 

[KnG818]

Always a bad idea to put down any money on a lease or loan. If the car gets stolen or totaled you would most likely get clipped for any" positive equity" you have in the car.

Bad idea to put money down?? LOL

....whatever you say dude

 

[Gellie]

Bad idea to put money down?? LOL

....whatever you say dude

I was actually try to be nice to someone who is misinformed about finance. Its actually a IDIOTIC idea to put down any money on a lease or loan....

 

[KnG818]

I was actually try to be nice to someone who is misinformed about finance. Its actually a IDIOTIC idea to put down any money on a lease or loan....

...please entertain me as to why you think putting money down is a bad idea.

Use me for example:
MSRP = 59,800
PAID = 52,300
DOWN = 28,000(Including taxes/fees)
CURRENT BALANCE = 22,400

Why is this bad?

 

[Gellie]

...please entertain me as to why you think putting money down is a bad idea.

Use me for example:
MSRP = 59,800
PAID = 52,300
DOWN = 28,000(Including taxes/fees)
CURRENT BALANCE = 22,400

Why is this bad?

What rate are you paying?

 

[KnG818]

What rate are you paying?

4.99

 

[Gellie]

4.99

would your rate vary on the amount financed?
Also your rate seems too high. Penn Fed is offering 2.99%

 

[KnG818]

would your rate vary on the amount financed?
Also your rate seems too high. Penn Fed is offering 2.99%

Yes a little high...who cares literally a few bucks difference not going to make or break me.

Putting money down is a GOOD idea. Either way your going to lose money on a new vehicle.

I'd rather loose it up front and be in a good financial position than loose it on the back end and be in a poor financial situation
(i.e. high monthly obligation/upside down on a loan).

 

[ctJLnewbie]

FCA has now three times more production capacity, including Gladiator, than it did only three years ago. And none of that added plant capacity came cheap; it cost FCA many months and billions in product development, new stampings, plant retooling, training worker, etc. And the return on that investment was calculated on significantly increased sales. So FCA now has every incentive to over produce in order to obtain those returns.

MSRP should not be completely meaningless. It is only when automakers become too greedy, produce too much, and start to play games that MSRPs become meaningless.

MSRP is meaningless. Basic economics dictate value. What's your car worth? exactly what someone is willing to pay for it, not a penny more.

...please entertain me as to why you think putting money down is a bad idea.

Use me for example:
MSRP = 59,800
PAID = 52,300
DOWN = 28,000(Including taxes/fees)
CURRENT BALANCE = 22,400

Why is this bad?

For me, on average my invested money earns 8%/year, so as long as I'm borrowing for less than 8% it's good for me to put down as close to zero as possible. You can argue about inflation, so then say my 8% becomes 5% in real dollar terms, that's still better than the 4% I pay when I borrow.

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