Trade in confusion

[getimti]

I know this is a personal choice, but just brain storming here..

I have a 2017 honda crv with 55k miles and a 2010 bmw 528 with 100k miles.. both paid off.

Option 1
Trade in Honda (@24k value) and get model y

Option 2
Trade in bmw (@10k value) and get model 3..

Want to keep monthly payments @ 400.. and we r a family of 4,, one 6yr and 1 6 month baby...

Suggestions, considerations? Hoping for a friendly discussion...

 

[Gor-Gor]

For whom is the 3/Y for primarily? Also, if the Tesla will be for ferrying the family around then the MY, to me, would be the logical choice.

 

[Glenn T]

I know this is a personal choice, but just brain storming here..

I have a 2017 honda crv with 55k miles and a 2010 bmw 528 with 100k miles.. both paid off.

Option 1
Trade in Honda (@24k value) and get model y

Option 2
Trade in bmw (@10k value) and get model 3..

Want to keep monthly payments @ 400.. and we r a family of 4,, one 6yr and 1 6 month baby...

Suggestions, considerations? Hoping for a friendly discussion...

Personal opinion with a family four I would go with the Y. I have a Model 3 and it’s sporty and fun, but with a family of four you are going to need space to pack stuff in especially as your kids get older and the Y will give you that opportunity.

Trade in wise I would go elsewhere like an autonation to get some good trade in bucks for your new Tesla.

 

[getimti]

Thanks guys.. Trade in honda for model y makes sense right?

 

[Hippo25]

The Honda probably has many more years to go, don't know about the 10 year old BMW. If you trade-in the Honda now, you may need to make another car decision in a few years with the BMW. Just thinking from another angle...

 

[getimti]

Good angle.. given the bmw value, was thinking of model 3 if I just replace that.. mainly for local use.. and jeep the ice honda for longer trips

 

[getimti]

BTW, if I keep honda, and trade bmw, then I will have honda for family trips,, and can use model 3 for local commute, and school pick up drop.

 

[sgalla04]

Can I get some help with trade-in plus sales tax savings with Tesla?

My Tesla trade-in value is $21,700, but I owe $21,664 on its current loan. My local sales tax is 8%. Do I save 8% on the $21,700 or 8% on the $36 difference? Obviously this is a big difference and will determine if I go with Carvana or not.

My final payment changed when I accepted Tesla's trade-in value. My SA said it's because I still owe on the trade. So if I pay off my current car's loan before delivery next week, then I'll save the additional $1,733? It's either that or get the $2,229 additional from Carvana. And my SA just told me I need the physical title for the car, so it's doubtful I'll be able to move money around fast enough to pay off plus get the physical title in time.

I was willing to go with Tesla's offer + sale tax savings if less than $500 for convenience. It was $496 less, but if this is true with still owing on my current loan, then that's a big hassle to get the sales tax savings. Which one is correct? I am able to schedule delivery for Monday next week.

 

[DayTrippin]

I can't speak for your state, but usually it doesn't matter if there is balance owed on the trade or not, you will typically only pay sales tax on the difference between your trade and the new Tesla. So you should save the 8% on the trade in value if PA is like many states.

You can have a physical title for many states even if there is a lien against it. Again can't speak for PA specifically usually that isn't an issue. I know in Florida I was going to trade in a car and even though there was a balance owed, all I needed to do was bring in the title and they would pay off the car and factor that into the amount borrowed on the Tesla.

I would speak to another SA and see what they say. It seems odd. Also check Vroom if you haven't for a valuation as well. They beat Carvana and Carmax by a lot. They still came in less than Tesla though when I factored in the sales tax savings.

 

[sgalla04]

I can't speak for your state, but usually it doesn't matter if there is balance owed on the trade or not, you will typically only pay sales tax on the difference between your trade and the new Tesla. So you should save the 8% on the trade in value if PA is like many states.

You can have a physical title for many states even if there is a lien against it. Again can't speak for PA specifically usually that isn't an issue. I know in Florida I was going to trade in a car and even though there was a balance owed, all I needed to do was bring in the title and they would pay off the car and factor that into the amount borrowed on the Tesla.

I would speak to another SA and see what they say. It seems odd. Also check Vroom if you haven't for a valuation as well. They beat Carvana and Carmax by a lot. They still came in less than Tesla though when I factored in the sales tax savings.

Thanks for the info. It looks like in PA it is only on the positive equity. I reached out to a friend who owns a Cadillac dealership in PA. He confirmed this to be the case. I wish this was clear on either the Tesla FAQ (though I realize they cannot accommodate every state) or on the PA gov't site. The PA gov't site just says you save on the sales tax via a trade, but doesn't stipulate only on the positive equity.

If I knew, then I could have borrowed equity against my M1 Finance account. They have a $5,000 @ 0% interest until June 30th promo running right now, it would have been pretty easy to borrow an additional $15,000 @ 2% and pay off the car to take full advantage of the tax savings. Too late now to move the money and get the physical title in time. I just hope posting this can help someone else in the future. Looks like I'm going with Carvana now, which is still $496 more than I originally thought I was getting with Tesla. So net-net, not a big deal, just have to take the train to get the MY.

 

[DayTrippin]

Wow, this sucks. Did you pay sales tax on the entire vehicle or just the equity you had at the time of purchase? Not to be on a political rant but it just seems like another way for the government to screw you. I am certain you paid sales tax on the entire purchase price. Remind me to never move to PA. My wife was considering a job in Philly, I will try to nudge her away from that one to some other ones she is considering. Times like this remind me of why I moved to FL, that and no income tax and nice winters...

You know you could always move your delivery day a few days if it is worth it. For me, I'd do it on principle alone and not give the government any more money than they already steal from us. At least Carvana isn't a terrible option either.

I hope it all works out in the end. Enjoy your new car!

 

[sgalla04]

Wow, this sucks. Did you pay sales tax on the entire vehicle or just the equity you had at the time of purchase? Not to be on a political rant but it just seems like another way for the government to screw you. I am certain you paid sales tax on the entire purchase price. Remind me to never move to PA. My wife was considering a job in Philly, I will try to nudge her away from that one to some other ones she is considering. Times like this remind me of why I moved to FL, that and no income tax and nice winters...

You know you could always move your delivery day a few days if it is worth it. For me, I'd do it on principle alone and not give the government any more money than they already steal from us. At least Carvana isn't a terrible option either.

I hope it all works out in the end. Enjoy your new car!

Thanks. Yes, I am going to have to pay the full sales tax of 8% (6% PA + 2% Philly). I was thinking moving the delivery day to not let the gov't get all of the tax too! But I'd rather have the car and the Carvana offer still nets me $496 more.

On an aside, Philly is pretty great. Taxes are a bit higher, but amenities are good. Strong public transit, public pools, amazing restaurants in walking distance, parks, museums, sports, etc. Property taxes are crazy low compared to the suburbs. So in the end you pay a bit more, but the enjoyment level is nice. Only thing is when my daughter enters 1st grade (3 years from now), that will be an issue and we will probably have to move to the burbs because of cost of private school in the city.

 

[DayTrippin]

Thanks for the insight on Philly. My wife really likes amenities like museums, cultural venues, parks, etc. so might be worth considering. I want to stay away from NYC as much as possible and that is on her list too. I'll have to look into what PA income tax is there now for us.