Should I buy a 2011 Honda Fit?

I can get a brand new automatic 2011 Honda Fit for $15,969 through USAA, $701 off MSRP. I can put $5,000 down. USAA is offering me a 5 year loan at 7.99% APR and I have a 745 credit score. My estimated monthly payments will be around $222–$244 a month. My insurance for me being a 19 year old male driver will be about $161 a month. Is this a good deal? I'm in the military and I make about $1,400 a month after putting money away for my G.I. bill, retirement, taxes, etc. From the reviews it seems like a pretty nice car. I'm not really interested in buying a used car. I know with a new one I take a loss when I drive it off the lot but I want the reliability of a new car. Does this sound like a good idea? Should I look for different auto loans? Thanks for any advice..

Update:

Flanders- Yes I have a decent credit score, I do have a low net income however I don't pay anything for food, housing, or health insurance..so its all spending money for me. Maybe I should have told USAA this so I could possibly re-negotiate a better rate. I looked around on other insurance rates and I got quotes for higher than what USAA quoted me. I live in the dorms on base so everything I need including my work is within walking distance, and I have a bicycle at the moment. The car will probably sit around for about 6 months when I get deployed next year. But by that time I will have it paid off completely, and when I do get deployed USAA has much cheaper insurance because the vehicle will not be in use.

2 Answers

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  • 9 years ago
    Favorite Answer

    The car is not an issue. The Fit is a reliable, fuel efficient vehicle that has the best resale in its class.

    The first question is about how often you are going to use it. You said you are in the military. Is this vehicle going to be sitting for months at a time? If so, it is hardly worth paying $400 a month, including insurance, for a new vehicle.

    The price of the vehicle is good. However, you could probably still negotiate that deal without the help of USAA.

    The 7.99% APR is, typically, too high for someone with a 745 credit score. However, I am sure your age and low monthly income factored into it being a little higher than the normal loan for someone with good credit. It isn't horrible, especially if you don't have an extensive credit history. Just make sure you can keep current on this loan because if you fall behind, your credit will tank very quickly.

    Lastly, make sure you shop around the insurance. I know you are young, but unless you have a horrible driving record, $161 a month is insanely high. You need full coverage on a vehicle with an outstanding loan, but it doesn't hurt to shop around for the best price.

  • Bill
    Lv 7
    9 years ago

    Its a reliable car but I would look at the 2011 Ford Fiesta before making as final decision.

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