What to do with unexpected windfall
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| Wed, 10-06-2004 - 1:07pm |
Here's the situation: We bought a car online (some of you may remember the discussion regarding our old Mercedes diesel that we planned to convert to bio diesel). Turns out, when we went to get estimates on several minor problems that we knew about before purchasing the car, that there were many major problems that had not been disclosed prior to sale and basically it's undriveable (because of safety issues) until we spend a couple thousand on it (we paid just over $1k for it).
I shared this with my aunt, and she offered to give us a car! Well, at first we refused, but the situation is that her son is getting her x5 (I think that's the Lexus SUV), and he needs a home for his Camry, which they would rather give to us than sell. It's a 2000 Camry, probably in fantastic condition if I know my cousin and aunt (we haven't yet received it). So we accepted.
Now, we have to decide what to do with it. Obviously, it solves our car problem instantly. But my aunt told us that we can drive it or sell it, it's all the same to her. And the truth is that we really would rather have a diesel vehicle, to save on gas costs.
So right now we're planning to drive it and see what we want to do before making a decision. But the other part of the equation is that we still owe nearly $10k on our Subaru Outback. We ultimately would like to own an old Mercedes 300 (early 1980s probably) diesel as a family car and a small, old diesel pick-up (like an Isuzu, VW, or Toyota).
If we sell the Outback and pocket the $2k difference between what we owe and what it's worth, and sell the Camry (I would guess it's worth somewhere between $6k and $10k, depending on mileage and options and condition, none of which I know just yet), we can easily buy both vehicles with cash (and anywhere from a thousand to five thousand left in cash), and have no car payment (saves us $300 a month). Then we can use part of that cash to fit the vehicles for bio-diesel and purchase the refining equipment.
The other way we could structure it would be to sell the two vehicles and pay off our credit card debt, then take out a small loan to purchase the two diesel vehicles. Wow, we could actually be credit card debt free!! This would mean a small car payment (at most it would be half our current car payment), all our credit card debt paid off (we'd still owe my father a substantial sum).
In either event, we would set aside a significant portion of the monthly savings into a fund for car repairs as they become necessary.
The other option, of course, is to keep the two vehicles we have, or sell the Outback and keep the Camry, or any other arrangement. We really want the pickup because I'm always wanting to bring home compost and mulch and salvaged lumber, not to mention second-hand furniture, etc. And we need a family car large enough to haul our two boys and lots of luggage on trips.
What would you do?
Thanks for reading my tome! LOL
Blessings,
Heather

I just bought an 87 Mercury Tracer, no rust, new exhaust, looked really great, thought it would be really cheap on gas, but it turns out it probably has major engine problems. It's not cheap on gas and will probably cost me $500 to find out what's wrong with the engine (yes, I'm not going to spend that, I'm going to find another option). That's why I think you might be further ahead to take the camry and ditch the mercedes (and yes, I know how excited you were to get it).
That said, I would probably sell the Outback and use that to purchase the diesel pickup truck.
That's my 2 cents.
Rebecca
Anyway, Toyotas do last forever, and we always have loved them, so keeping the camry is a possibility. I guess it depends, too, on how well we can fit all our junk (and kids) in it! LOL
Thanks again for your feedback. I love this board because I always get good advice!
Heather
And I hear you about not buying another car without having it fully checked over by a mechanic that I've chosen. I think I've been burned this time, and I'm sorry it sounds like you've had the same thing happen to you.