Transport Flashcards
(69 cards)
Issues of buying or owning a car
Meets needs New vs used Car loan shopping Lease vs buy Warranty Maintenance Insurance coverage
Never borrow more than what perecent of your yearly net income
20%
If you earn $400 a month after taxes then your net income in one year is…
12 x400
Calculate 20% of your annual net income to find your safe load
- 12*400=4800
- 4800*20%=960
Means that you should never have more than 960 of debt outstanding
Housing debt Should not be counted as part of the 20% other debt should be included such as car loans student loans and credit cards
T or F
TRUE
Monthly payments should not exceed what percent of your monthly net income
10%
Before shopping used…
What is affordable Interests Repair facilities Blue books Loan and maintenance costs
Provide quality used vehicles service department available, higher prices than other sources
New car dealers
Specialize in previously owned vehicles, limited warranty, vehicles may be in poor condition
Used car dealers
Do you be good to buy this vehicle was well me maintained, few consumer protection regulations apply to private party sales
Private parties
Such as options or sales by government agencies, auto rental companies, and on the Internet, most of these vehicles have been driven many miles
Other sources
Sources of used cars
New and used car dealers, other sources, and private parties
Shopping for new car
Car model Invoice and true price Budget above invoice Price Offers Compare costs Optional service contract or credit insurance
Advantages of leasing motor vehicle
Smaller initial outlay
No additional outley of money for regular maintenance
Detailed records for business purposes
Disadvantage of leasing a motor vehículo
No ownership interest
Additional costs
What do you have to pay at the beginning of the lease
MALDS
1. Monthly payment Security deposit Last monthly payment Down payment Acquisition fee
Processing or assignment fee
Acquisition fee
What do you have to pay DURING lease
MAIM
Monthly payment
Additional taxes
Insurance
Maintenance costs
What do you pay at end of lease if you don’t buy the vehicle
Disposition fee
Excess miles and excessive wear
Protects you if the vehicle is stolen or totaled in accident
Gap coverage
Rights under lease
Agreed upon months and miles
Buy vehicle if you have a purchase option
Take advantage of warranties
Extended warranties
Service contracts
The earlier you end the lease…
The greater the charges will be
No expressed or implied warranty, if you buy a car and have problems with it you must pay for any repairs yourself
As is warranties
No warranty
