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Are you ready to go into dept?

hilldown

Chimp
Aug 30, 2005
69
0
Oroville, CA
Im about ready to get a small personal loan out to buy a really nice DH bike. Not really getting a lot of positive feedback from the non riders ( family) so I thought I could get some motivation from the monkey's. Or talk me out of it, but its a rad bike and Im sure I can pay it off. Did you guys just walk in with cash and buy your bikes? Is everyone else in the world loaded?
 

deweydude

Monkey
Mar 23, 2005
418
1
Washougal Washington
yep :D :D

I have plenty of debt but my bike is not one of them other than buying parts on a credit card.
I would never take a loan to purchase something that is going to depreciate so badly when I walk out the door with it :nope: :nuts:
 

Toshi

Harbinger of Doom
Oct 23, 2001
28,748
2,742
don't take out a loan for a bike. that's just dumb. save your cash. the season's almost over anyway.
 

seabass

Chimp
Aug 30, 2002
80
0
knoxville, tn
hilldown said:
Im about ready to get a small personal loan out to buy a really nice DH bike. Not really getting a lot of positive feedback from the non riders ( family) so I thought I could get some motivation from the monkey's. Or talk me out of it, but its a rad bike and Im sure I can pay it off. Did you guys just walk in with cash and buy your bikes? Is everyone else in the world loaded?
There is nothing wrong with a little debt. I wouldn't go the personal loan route though. The rates tend to be very high. Put in on a credit card and then switch the balance to a low rate on another card. My Merrill Lynch card is fixed at 5.9%. Pretty cheap money.

I can't speak for the others here, but I am fortunate enough to be able pay for most everything with cash. However that wasn't always the case. As a young monkey it was either float a little debt or not have the bike I wanted. Paying a few bucks in interest is not the end of the world. Just don't let it get out of hand.
 

jacksonpt

Turbo Monkey
Jul 22, 2002
6,763
0
Vestal, NY
sorry, but taking out a loan for a bike is assinine (or however you spell it). No, not everyone is loaded, but most people buy the bike they can afford, or give up something else they want so they can buy the bike of their dreams. If you absolutely must have this bike, put it on a credit card, then transfer the balance over to a card with 0% interest on balance transfers... just make sure you pay it off in the time alotted. At least that way you get out of paying interest.
 

binary visions

The voice of reason
Jun 13, 2002
21,695
498
NC
Personal loans tend to have pretty high interest rates, especially if you're young and without a lot of credit history.

Frankly, I'd say if you can't afford the bike, don't buy it. When I bought my first really expensive bike, I gave the shop owner a deposit on it, and he put a "SOLD" sticker on the bike and set it on a shelf for me. I then paid it off over the course of a month and a half or so, and he allowed me to "test ride" the bike a few times while I was paying it off.

You could try working out a loan through your parents/older siblings/etc. in order to avoid the interest, not to mention that falling behind to them means you get yelled at, but falling behind to the bank means damaged credit.
 

laura

DH_Laura
Jul 16, 2002
6,260
15
Glitter Gulch
johnbryanpeters said:
There's no such thing as cheap money. Save the cash first.

i agree. why would you put yourself in deBt if you didn't have to. there are necesities and there are luxuries, and putting yourself into debt for a luxury seems short sited.
 

Wumpus

makes avatars better
Dec 25, 2003
8,163
154
Six Shooter Junction
There is know way I would take a loan out for the full price of a bike. If you can't come up with at least half upfront, I would say no way. That way if you lose your job or something, you can probably sell the bike off for enough to pay off the loan/credit card. Nothing wrong with trying to build a little credit, but wrecking it early in life sucks.
 

-dustin

boring
Jun 10, 2002
7,162
1
austin
i just bought a bike i couldn't afford. was supposed to be a graduation present, but i found out this particular bike was no longer going to be made. i had been wanting one for 4yrs, and at the time, only 2 more were available in my size. so...i could either pass up a bike that i waited 4 years to get, or i could put it on a credit card and transfer the balance. i did the latter. 0% interest for a year, or something like that.

i don't regret getting it, but because i had to pay for it 5 or 6 months ealier than expected, i had to shave off some costs on the bike (different specs, etc). i am also having to seriously cut my spending right now. add to that the ER visit i just had, and the DR's visit, and well, i don't consider myself to be in a particularly good situation.

of course, all this would be alleviated if a freakin' bike shop would give a damn chance.
 

DirtyDog

Gang probed by the Golden Banana
Aug 2, 2005
6,599
0
There's nothing wrong with borrowing money. If this is the only debt you have then go for it. You'll have a new bike and you will be building your credit. Just don't plan on selling the bike and paying off the loan later on. The bike will depreciate in value much faster than you pay off the loan.
 

DirtyDog

Gang probed by the Golden Banana
Aug 2, 2005
6,599
0
seabass said:
There is nothing wrong with a little debt. I wouldn't go the personal loan route though. The rates tend to be very high. Put in on a credit card and then switch the balance to a low rate on another card. My Merrill Lynch card is fixed at 5.9%. Pretty cheap money.

I can't speak for the others here, but I am fortunate enough to be able pay for most everything with cash. However that wasn't always the case. As a young monkey it was either float a little debt or not have the bike I wanted. Paying a few bucks in interest is not the end of the world. Just don't let it get out of hand.
A young person with no credit won't be getting 5.9% credit card offers.
 

hilldown

Chimp
Aug 30, 2005
69
0
Oroville, CA
I didnt think I spelled loan wrong? Anyway, thanks for the feedback everyone. I know alot of you are holding back, trying not to call me a dumba$$ for even thinking it up. But I have no other debt, and I am trying to build credit anyway. Maybe a credit card is the way to go? The other problem is Im not that young. Im 22 without a solid credit report. No matter, thanks for the input.
 

-dustin

boring
Jun 10, 2002
7,162
1
austin
BeerDemon said:
A young person with no credit won't be getting 5.9% credit card offers.
is there an age with %-age rates drop? i'm 23, and my score in in the A+/ excellent range, but i still can't get anything less than 10%. does age, yearly income, time at current address, etc affect it?

hilldown, you spelled debt wrong.
 

joelsman

Turbo Monkey
Feb 1, 2002
1,369
0
B'ham
I think it depends on how fast you can pay it off. if you can pay it off quickly(less than a year) then ok, but in 2 years you will likely want something else.
 

Repack

Turbo Monkey
Nov 29, 2001
1,894
0
Boston Area
Toshi said:
don't take out a loan for a bike. that's just dumb. save your cash. the season's almost over anyway.
That was my first thought. You should figure out what you want to pay monthly for it and just put that money into a savings account. Then pay cash for it. Its a good to in general for figuring out how much debt you can handle. More so w/ car payments. I do not know what you experience with debt is but in general it seems very easy to rationalize about 50% more debt than yo can actually afford. I base my experience on a Pathfinder that I finished paying off at the beginning of the summer.
I bought my first bikes working at a shop. About 80% of my paycheck would go towards bike debt. But that was when I was like 14 years old. As I got older I would do stuff like work spring break in exchange for a fork or other pricey item. One year when I did that I got a $2 bill in the mail form my boss. I didn't realize I had cut it that close with my hours. It was a good laugh at the time.
 

bluebug32

Asshat
Jan 14, 2005
6,143
0
Floating down the Hudson
You only live once, but what kind of life will it be if you're riding the bike and all you can think about is the debt you're in? Try to borrow from the family or check on Ebay in the meantime.

And, good luck. I certainly know how you feel!
 

manimal

Ociffer Tackleberry
Feb 27, 2002
7,214
14
Blindly running into cactus
dude, if you ever have to use a credit card or take out a loan, other than a mortgage, than you're living outside of your means. rewind history about 40 years and ask your grandparents what they did if they really wanted something and didn't have the money......they didnt buy it or they worked their arse off and saved until they could afford it.

i was an idiot and used a credit card and loans for things i WANTED but didn't NEED and now, 7 years later, we're still paying for it (although we're less than 5 months away from being debt free, down from $14k 9 months ago when we decided to get serious about paying off our debt). u can rationalize like the inbred did and say, "well...i have to get it now or else..." but remember, you're just rationalizing to make yourself believe you need something that you don't.

here's a little breakdown

let's say you get the bike for $4,000. you MIGHT be able to get a CC with that kind of limit, but if you can't afford the bike right out you probably won't have that kind of limit. so..you'll probably have to get a personal, or "signature" loan which will have a higher interest rate because you have nothing to offer as collateral. average APR for that type of loan is 21%.

so....
4000 X .21 X term of loan = total you pay

4000 X .21 = 840 (that's the interest you'll pay each year of the loan)

a modest loan term for that amount will probably be about 24 months. so, a rough estimate of the total amount you'll pay for that bike will be .......

$5,680.00

now, that's with a loan that has a set repayment term, use a credit card and just make the min payment and you'll pay well over $8k for that bike you just had to have.

it's all about delayed gratification, a concept that our generation has completely neglected. "i've got to look successful before i really am successful".

i hope you choose to wait or find an alternative way
 

seabass

Chimp
Aug 30, 2002
80
0
knoxville, tn
manimal said:
so....
4000 X .21 X term of loan = total you pay

4000 X .21 = 840 (that's the interest you'll pay each year of the loan)

a modest loan term for that amount will probably be about 24 months. so, a rough estimate of the total amount you'll pay for that bike will be .......

$5,680.00
Total interest on the scenario you describe would be $933.02 not $1680.00.

You are right though, loans suck. I try to let others pay me interest not vice versa, but like I said above, a small amount of debt is not the end of the world. You just have to use some discipline and not let it get out of control. I don't regret having financed a bike ten years ago. Cycling is my passion and at the time it was the only way I could have the bike I wanted. I would much rather pay a little interest on a bike than a car.
 
J

JRB

Guest
I pay a lot of interest. I want to buy some things, but am trying to show restraint. If it's one loan, do it. Be careful. I could have a nice house for what we pay on cards. I have chosen to be stupid in the past.
 

mack

Turbo Monkey
Feb 26, 2003
3,675
0
Colorado
laura said:
there are necesities and there are luxuries, and putting yourself into debt for a luxury seems short sited.

Unless its a F-450 with a Power Stroke Diesel and a bass boat to tow behind it.

But in order to do this, you must have a trailer home/queen and work construction. Otherwise, this is not allowed.
 

SkaredShtles

I love NEWCASTLE and will ONLY drink NEWCASTLE!!!!
Sep 21, 2003
50,866
4,209
In a van.... down by the river
loco said:
I pay a lot of interest. I want to buy some things, but am trying to show restraint. If it's one loan, do it. Be careful. I could have a nice house for what we pay on cards. I have chosen to be stupid in the past.
Learn from Dumbass ^^^^^^^^^^^^

Don't do it.

:p
 

sanjuro

Tube Smuggler
Sep 13, 2004
17,411
0
SF
My last 3 bicycles I worked 6 days a week to pay for them. I would wait until I could afford something worthy rather than put it on credit or settle for something less.

Ride what you have for now. I rode a 7 year old hardtail and a $600 road bike until I could afford what I wanted.
 

hooples3

Fuggetaboutit!
Mar 14, 2005
5,247
0
Brooklyn
hilldown said:
Im about ready to get a small personal loan out to buy a really nice DH bike. Not really getting a lot of positive feedback from the non riders ( family) so I thought I could get some motivation from the monkey's. Or talk me out of it, but its a rad bike and Im sure I can pay it off. Did you guys just walk in with cash and buy your bikes? Is everyone else in the world loaded?

Honestly... the worse decision I ever made was to buy a brand new GT LTS-1 when it first came out. I didnt have all the cash.. so I put $2700 on my credit card, then school came and more money went on the card... it took me 5 years to get that card back to zero, and probably like $13,000. Id say dont spend the money unless you have it
 
J

JRB

Guest
Bear in mind, these are all opinions, and only you have the right answer. Good luck, whatever you choose.
 

-dustin

boring
Jun 10, 2002
7,162
1
austin
the Inbred said:
i just bought a bike i couldn't afford. was supposed to be a graduation present, but i found out this particular bike was no longer going to be made. i had been wanting one for 4yrs, and at the time, only 2 more were available in my size. so...i could either pass up a bike that i waited 4 years to get, or i could put it on a credit card and transfer the balance. i did the latter. 0% interest for a year, or something like that.

i don't regret getting it, but because i had to pay for it 5 or 6 months ealier than expected, i had to shave off some costs on the bike (different specs, etc). i am also having to seriously cut my spending right now. add to that the ER visit i just had, and the DR's visit, and well, i don't consider myself to be in a particularly good situation.

of course, all this would be alleviated if a freakin' bike shop would give a damn chance.
well, so much for that. will be keeping the frame, but will be getting refunded for everything else. ER visit really ****ed over my plans. i'd rather have that paid off, and push back the bike, than have the ER bills sitting there.
 

mobius

Turbo Monkey
Jan 25, 2003
2,160
0
Around DC
Taking a loan or doing a payment plan or anything on a bike is retarded. Cause you will want a new bike in a year and still be paying for the current one.
 

BigMike

BrokenbikeMike
Jul 29, 2003
8,933
0
Montgomery county MD
I have always saved for my bikes, and then bought them. Same thing with my Pathfinder. Cash is the new thing :cool:

It really sucks saving money and not getting what you want when you want it, but it pays off in the end. I am REALLY bad with money, so I started a CD with some money to make sure that I wouldn't touch it.

And on the Cash thing, apparantly when you say "cash," dealers think you mean a check, and when you pull 11 grand in cash out of your pocket, they are a little suprised :D