In the summer of 2004, my dad and I went to the local Saturn dealership and purchased a 2002 Saturn SC2, which was at the time, a “dream” car based on what my dad agreed to purchase for me. (The choices were slim, and this was the “sportiest” car I could convince him was good for me) Her name was Red Hot Chili Pepper and she was good me for the most part, purchased at 32,000 miles but started having serious problems once she hit 50,000 miles. She survived two people rear-ending her within a five day period, unfortunately, right after I graduated from high school.
After graduating from college, it became unbelievably embarrassing to drive RHCP with a “UCF ALUMNI” license plate frame. “Chili,” for short, became unreliable in every possible way. The sunroof’s motor broke (and would cost at least $500 to fix). The tinting was starting to peel on the inside of the windows. No matter how often I changed the oil, she continued to suck gas. The wheel vibrated every time I hit 60 mph and was difficult to drive. The alignment was constantly off and it was never balanced. The transmission nearly died out of nowhere while trying to drive to Tampa in late 2006. My parents told me toward the end of Chili’s life with me that they did not even trust my car to be driven outside of town. It was time for a new car; Chili had seen much, much better days.
My dad was driving a Mazda Tribute for a few years before gas prices soared in 2008. He traded in the Tribute and leased a car that included a new, experimental concept: a Honda Civic Hybrid, quickly named “Itsy Bitsy.” The first time I drove that car, I could not believe the difference. I was in love with the newness, the smoothness, the non-vibrating wheel of this car. It was quiet when idle, it had an electric speedometer, it displayed the miles per gallon where the temperature gage is usually situated. It had four doors and even had blinkers on the side mirrors. I was in love.
In late 2009, I began researching the car further, which included going to dealerships and test driving a few of the non-Hybrid models. I was harassed by car salesmen for months despite my apparent clarity that I was not ready to purchase, only research what I needed to eventually purchase a car.
The problem that most of us recent college graduates run into when purchasing our first car is getting approved for a loan. Not because we have bad credit, but because we have little to no credit. This usually requires a co-signer on a loan, which my dad said he would no longer do for me once I graduated. One of the main things a car loan depends on is history of a similar loan, particularly another car loan or a home ownership loan. When recent graduates apply for a car loan, they’re denied because there simply is no history. Even though I’ve had a few credit cards (one through Express and one through SunTrust Bank), I still hadn’t built up enough history to qualify for a huge car loan. So, I was denied on a number of occasions when Honda tried to approve me for a loan, despite my telling them I already knew I couldn’t do it alone. (Thank goodness for that, really, because it was a good excuse to not be able to purchase!)
Luckily, Honda has the Honda Graduate Program for new college graduates to be approved for a loan without the co-signing of a parent. The loan is pretty specific on what allows one to qualified for it, but it turns out, I was exactly what they were looking for in a candidate. Roughly, the criteria is as follows:
- a recent college graduate, within a specific time frame from graduation
- valid for purchases only (not a lease, in other words)
- requires a 5% down payment (which my trade-in qualified)
- requires a 60 or 72-month loan
- allows for a three month first-payment deferral
My parents encouraged me to go through the graduate program when the time was right, of course. They discouraged me from purchasing a car until I had more money to add to the down payment and told me that I was completely on my own when it came time to trade in Chili. After living with my parents for over two months in late 2009 and adopting my dad’s car as my own while he was out of the country for work, I decided that now was the time to buy a new car, despite their advisements against it. I returned to Florida having been offered a salaried job and got a new apartment, a new roommate, and was starting over in my life. I wanted to live alone, but I realized that with my salary, my choices were to live alone and keep driving Chili, or get a roommate and therefore be able to afford a car payment with the money saved in rent. I chose the latter. It was that important.
I began doing further research after finding about USAA’s “Car Buying Service.” They had already done the haggling with the dealers and had prices set up with different ones in the area. I worked with the representative from a specific dealer who told me that it could all be arranged for me to the point of I would never even have to see a dealer. They could drop off my new car to my apartment and tow away my old one and I would sign and turn over Chili’s keys to them. It was seemingly a great idea, until I started digging deeper. I was quoted an already-haggled price of $17,000 for a Civic DX Sedan. This was nearly $3,000 more than what I was quoted when I first began speaking to dealers without the help of USAA months before. I knew I could get it for less, it was just a matter of finding out who would give it to me for less.
Then, close to New Year’s Eve 2009, I received a call from a dealer in south Orlando. They told me that they would beat the price that USAA had pre-negotiated by 100%. Someone who doesn’t know much about purchasing cars immediately would be “sold” on the idea, because it sounds like a lot of money would be taken off the quoted price. And while that is true, money would be subtracted from the $17,000, they decided to quote me a ridiculous APR when I went to their dealership to discuss it. They quoted me 9.9%.
…to be continued.