Tag: car

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HELOC to Finance New Car?

Interesting… so while contemplating on how I should finance my new car, I started to do research on the best method. Originally my 2 options were:

  • Sell stock and buy the car outright
  • Make a small down payment and finance the car at $400-600/mo for 60 months (at ~6.6% interest rate)

However, I’ve been looking at HELOC (home equity line of credit) and it’s looking more and more like the correct action to take. One thing that does have me a bit worried is that HELOCs are variable rate, but according to MarketWatch, the current HELOC interest rate is around 3.25% (is it me or is that exceptionally low?). I’ll need to discuss this further with my dad and Derek as they know a lot more about HELOCs than I do.

Even if the interest goes up to 7%, there’s a huge benefit in using HELOC to finance my car and that’s because the interest is tax deductible. According to BankRate.com:

When you refinance acquisition debt or take out additional debt such as a HELOC, you can deduct the interest on such debt if you use it to improve your residence and on up to an additional $100,000 that you can use for any purpose, except for the purchase of tax-exempt securities such as municipal bonds. If you use the $100,000 to buy a second home, then it gets thrown back into the $1 million pot.

Maybe when I bring this up with my dad and Derek, they’ll knock me on my head and call me stupid for thinking up such a stupid scheme. But so far, it feels like a sound plan. I wonder if I have enough money in my house yet to cover the whole purchase.

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Time for a New Car?

With the recent issues found in my current car, my dad’s been suggesting that I might want to purchase a new car instead of investing $1k into repairing a car which currently has a ~$6k resale value. Plus he says the sales tax would definitely help me with taxes for the year 2010 and if I purchase a hybrid, I may even save more.

That got me start thinking about getting a new car. I’ve had my current 2001 Honda Civic EX since high school and it’s still going great, still giving me ~28MPG, but it’ll turn 10 years old this Thanksgiving. Kelley’s Blue Book says I can trade-in my car for ~$6000. However, a bunch of stuff is going on right now in my life and I haven’t really even decided what type of car I want yet.

After speaking with Derek, I decided I’d probably fix up Civic for now and somewhere down 2010, purchase a new car. As for fixing my Civic, instead of going to the dealer, I’ll be getting quotes from other auto shops around town. @rothgar gave a really good suggestion about checking out AAA certified auto shops. There also appears to be a good list on Microsoft Prime.

So Derek and I were brainstorming ideas of what my next car should be. I decided I’d be willing to spend between $30-50k (funny that I actually have just over that in liquid assets). On an unrelated note, Dad also said I should probably open a HELOC and start borrowing money to accrue interest for 2010 tax purposes.

I’ve always been a big fan of the BMW M3 since vonlobster introduced it to me back in college, but that might be out of my price range. Derek also says that the M3 is a harsh ride where you can feel every acceleration, corner turn, roaring engine, etc., and wasn’t sure if I’d be a fan of that. He also suggested if I was interested in an M3, to purchased it used would be his recommendation, like what he did.

I was initially thinking of a BMW or an Audi, but Derek’s been scaring me with high maintenance costs for BMW and Audi cars (i.e. oil change for the M3 is $250 because it uses special motor oil). The Audi A4 and A5 are looking beautiful. Derek also suggested that I may be interested in the BMW 335 or 135, which look sweet also.

I may also consider getting an Acura or Lexus. For some reason none of the current Acura car line-up looks that great. Maybe I just don’t like the way the front looks. On the Lexus side, the IS looks really nice.

Probably need to get together with Derek someday to talk more about cars.

Update: The more and more I compare, I’m starting to really dig the Audi A4.

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Car Trouble – Dead Battery

Wow, it’s been awhile since my last real blog post.

So on Friday, I hit into some car problems. As you may have guessed from the title, I had a dead battery. It was a rather interesting ordeal and I definitely had a very unexpected day.

As I was leaving for work around noon, my car would not start. When I try to start the ignition, it would flutter/click a lot. I’ve experienced dead car batteries before and know the sound they make when you try to start your ignition. It sounds like it’s trying to start, drag on, but would finally die and retry. This was a very different sound, but I really had nothing else to go on. The radio/lights still worked, but that doesn’t really mean anything. I had a car battery jump starter, but unfortunately it had been sitting in my garage for some time and was fully drained and needed to be recharged. While it was recharging, the thought of using AAA popped into my head. I wasn’t sure if they covered jump starting cars, but if they did, it’ll probably be faster for them to come and jump start my car than to wait to for my jump starter to recharge. And if it’s not the battery, I could probably have them tow my car to a servicing center.

I looked on the website and it did indeed have this service. I pulled out my AAA card and noticed it expired on 2/28/2009. Thinking to myself, “Crap, did I forget to pay? Did my credit card on file expire?” I checked my account status online and it appears that I am still an active member. I guess I must’ve misplaced my newest card. Conveniently, I was able to submit the request online and it said it’ll take about 45 minutes. Meanwhile, I had a meeting at 2pm which I sort of needed to attend. I sent an email to work notifying them of my car problems and was hoping I’d still be able to make it in time, but worse case, I’ll probably call into the meeting from home.

I tried to start up my car a few more times to see maybe if I’d get lucky. That’s when I noticed the flashing green key on my dashboard. I looked up the manual and it said that the flashing green key meant the immobilizer system was activated. To quickly explain the immobilizer system, Honda and other car manufactures are putting computer chips into the keys, so only a legit key can start the car. I thought maybe I damaged the key chip in some way, ran up stairs to get my 2nd set of car keys, but that didn’t start the car either. I even tried the valet key (key that can start the car, but can’t open the trunk), but no luck. I decided to call Bellevue Honda, but while I was on hold waiting for a service tech, my AAA guy showed up.

Apparently I got sent a giant tow truck (one with those flat beds where the whole car goes onto the back). I’m surprised he actually managed to weave his way through my complex. I mentioned that it might not be a dead battery as the starting sound was weird and may actually need to be towed to a servicing center. He said, let’s give it a shot first and pulled out a super long jumper cables and connected one end to his giant tow truck and the other end to my car battery. I turned the key and VROOOOM, my engine roared. So it was indeed a dead battery. My only explanation for the flashing green key/immobilizer system is that the immobilizer system needs electricity to verify the computer chip and when there wasn’t enough to start the engine, it presumed I had a bad key and stopped it short before even trying to start the engine, creating the clicking/fluttering noises I heard.

The tow truck guy told me to leave the car running for 30 minutes before turning it off so it can charge my battery. I asked him if I could drive it and he said that’d be even better. I thank him and he left. After he left, the thought of tipping him popped into my head. Since this was my first time dealing with AAA for car related issues, I’m not sure if I was actually suppose to tip in that situation or not. But oh well, it was too late to do anything anymore.

I left for work pretty much soon after. I took along my car jump starter (75% charged at this point) with me just in case. I phoned Jan Lyk to let him know that I’ll be a bit late to the meeting and was wondering if he could take point until I got there.

So yada yada yada… no it’s not the end of the story quite yet.

Anand (my former lead) was having his moving to a new team party and I got out of my meeting a bit late, so I missed the car pooling. When I got to my car and tried to start it, I encountered the same issue this morning. I pull out my jump starter and barely managed to jump start the car in the parking garage. The question now was do I go to the farewell party or do I go to Sears (where I bought the car battery from) and have it looked at. After some contemplation, I decided to get the car battery looked at first and if there was still time, I’d join the party.

I got to Sears and parked. I thought about leaving my engine running, but thought worse case scenario, Sears auto center probably can jump start it for me. I was then told to drive my car into the Sears auto servicing center. It took a few tries to get my car started again and the tech started diagnosing the battery. Since I wasn’t originally planning to have my battery replaced this morning, I didn’t have my Sears battery receipt on me. I only hoped they still had me in their system. The tech told me my battery was completely dead, but the alternator was working fine, so I began the process of getting the battery replaced.

I knew I only had my battery for 2-3 years and they were able to find me in their system. Apparently I had it for 3 years and 2 months, 2 months over the free replacement warranty period. I was now on the pro-rated warranty period which reduced the battery price from $90 to $30. Still good I guess, though I was really shocked that their best battery (DieHard Gold series) would die so quickly. The battery replacement would take about 45 minutes and I went into Sears to watch Ratatouille in the mean time.

When it was done, it was already close to 6pm and too late to join the party. I went back to work since I had to leave around 7:15 to meet some friends for dinner and games.

All in all, as I mentioned earlier, it was definitely an interesting and unexpected day.

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Switched to Progressive Auto Insurance

So as my dad and Derek always says, get quotes from at least a few auto insurance companies every time your auto insurance is up for renewal. I just got renewal package from Safeco and I’m not happy. Last time, they decided to raise my insurance by $3. I thought they were still pretty cheap, so I didn’t bother getting quotes elsewhere. However, this time they decided to raise my premium by $40 to $460 for no particular reason. I was also expecting it to drop since I’m turning 25 in a week, and you know when you turn 25, you get a decrease in your auto insurance.

Anyway, I was pissed. I decided to see what Progressive would offer me since they were my insurance company before Safeco and they had the 2nd cheapest policy the last time I checked. All the other insurance companies have always quoted me $800+ for some reason. Entering my information at Progressive which matched my current Safeco policy, I was shocked to find out that the premium was only $326… Do note these prices are semi-annual (6 months) and not annual. Of course I was super happy. I did another quote at Geico just to check to see how they fared and they quoted me a premium of $600.

I decided to give Safeco a call to see if they’d beat Progressive, but apparently they aren’t open 24/7 (at least not the policy service center). So in the end, I decided to give up on them.

I had a few questions regarding my Progressive application and guess what? They have phone and online chat customer support 24/7. I inputted my phone number and told them to call me. When I picked up, there was immediately someone else on the other end. No wait time, no automated answering machine, no elevator music, nothing! The few questions I had was in regards to the fact they only gave me about 20 characters of space for my street address. Even with my abbreviations, it didn’t have enough space for “Way”. The customer support rep gave me an abbreviation that he said would work. I then asked about the policy start date as I didn’t see where to set that. He gave me some quick and simple instructions and I guess I must’ve missed it earlier. The final question I had was in regards to the fact I’m turning 25, but wasn’t 25 yet and if I would get the discount. He says that the premium does decrease when I turn 25 and that the application process takes that into account 30 days before my birthday, so my premium should reflect that. I thanked him for his time and couldn’t be happier with his support.

There was a report a few days ago posted on Consumerist: Complaint Ratios For Top 10 Auto Insurers. I was shocked to find that Progressive was ranked #7 in lowest complaint ratios, while Safeco was ranked in the bottom 10. However do take this report with a grain of salt since it is only complaints filed in New York. What exactly is a complaint ratio? According to the report, Insurers are ranked based on a complaint ratio. This ratio is determined by the number of complaints upheld against companies as a percentage of their total private passenger auto insurance business. The complaint ratio is calculated using an average of two years’ premium data. This compensates for the fact that some complaints closed in any given year are begun in the previous year.

Also, it appears my annual mileage, gas guzzling, distance traveled analysis is due. I’m just too lazy to aggregate all the data for now. Hopefully I’ll do it soon. Here’s a preview:

Total Distance Traveled: 7268.2 mi
Total Gas Used: 253.714 gal
Total Cost of Gas: $745.40

Average Cost/Gallon: $2.94
Average Mileage: 28.6 MPG
Average Distance/Dollar: 9.8 mi
Average Cost/Day: $2.04
Average Distance/Day: 19.9 mi