I feel horrible. Like I have been scammed or something. What can I do if anything? I still owe $130,000 on the car and can’t even sell it because I would then owe around $60,000 to pay off the loan compared to what I can sell it for.
I love the car, I really do but having a hard time getting over this horrible feeling of being taken advantage of.
and the punchline:
Hol up, you bought a $155k car a year ago, and you still owe $130k on it? How small was your down payment? You are what’s called “upside down” on your own loan: you owe more than the value of the thing you took out the loan on.
If you’re asking what financially you can do, the answer is nothing; you took out a very large loan with a very small down payment on a depreciating asset. Take this as a lesson about why you don’t do that, particularly when said asset can be crashed. All cars depreciate in value. Electric luxury sports cars from a relatively small company depreciate very, very quickly. Never trick yourself into thinking that your agreement to buy that car was ever anything but an agreement to light $155k on fire. In the future, if that’s not something you can afford to do, do not buy the car.
If you’re asking what you can do to make yourself feel better about your choice, my suggestion would be to try to focus on why you made the decision in the first place. You didn’t buy a $155k luxury car with a zillion horsepower because it was a sound financial decision; you bought it because it was fun. Nothing has changed about the car between now and a year ago; it’s still just as comfy, and it still rips your dick off when you hit the skinny pedal. The value of the car to you was never momentary, and that value hasn’t changed. What can you do? The same thing you were going to do before; out make your payments, and you keep enjoying your car. Don’t think about the financial value of the car; think about the value it has to you.
If you are in a situation where you can’t afford the loan payments anymore, you’re in a much tougher spot. I would talk to a financial planner, cuz you’re gonna need to do some clever maneuvering to dig yourself out of that hole. I’m guessing your best bet would be to sell the car for whatever you can get for it, pay off as much of the loan as you can with that lump sum, and try to refinance the remaining $60k or so at a better interest rate. You’d basically be making payments on a $60k loan rather than a $155k loan, which should at least be an easier hit to take each month. If you need a car, buy a reliable used one in cash, and pay off that $60k loan as fast as you can. Swallow your pride and buy an older Prius or something for $10k.
And for the love of god, don’t crash the Tesla; the max you’re going to get out of your insurance is the cost to replace the vehicle (unless you have gap insurance, which I really, really hope you do). If you total the car tomorrow, the max you’re going to get is $86k, and you’ll still owe $60k.
Sort of akin to girl math I believe there is an as of yet understudied field of “car math” where people do all kinds of mental acrobatics to reach some sort of calculation where new cars ever make sense as a private consumer.
I mean if you splurge on one, like that response said, you do you, but there’s a lot of folks pulling all kinds of numbers out of their ass to justify why their new car is some sort of sound financial decision. Imagine being beat by the “this is a status symbol because I rule” people vis a vis personal finance
back when I used to argue with people online, I remember this one guy’s argument for buying a new car was that he, as a financial planner, needed to project wealth and security to his clients.
he could not see the irony (doing something impractical to appear practical) and did not appreciate being compared to a con artist who invests in a $5000 bespoke suit or a record “producer” with a $10,000 gold chain.
I respect that, though. That’s not doing mental acrobatics, that’s performance and by and large cars are status symbols. It’s fine if you’re aware of it, whatever the reason may be. My gripe is with people that pretend their status symbol is sound financial planning because “you save on repairs” or whatever as if the 2 year old vehicle is going to start breaking down instantly all of the time (any more so than a new, shitty, vehicle would)
I mean, would you hire a defense or wealth lawyer who drove around in a beat up, two tone car?
IMO what people are paying for with new cars, outside of luxury and exotic cars, is the peace of mind that the car is virginal when you get it. No uncertainty of something that happened to it with a prior owner causing a problem down the road. That’s a personal judgement call for a car buyer, but it’s never an investment.
yeah but you can get that at much less price with like a certified used one. except for if the virginal part is really important to you, which I imagine it is, because I’m convinced people who do car math want to fuck their cars