I hate to say this but a cobra should be a cash purchase. Unless you live in a location you can drive it daily, it’s a total luxury and not something to go into major debt for.

The OP wasn’t asking for feedback on whether he <> finance a purchase, but he sure has gotten a lot of it anyhow. Without knowing his financial position and reasons for wanting to finance it’s irrelevant what anyone else would do. When I bought my first couple of “toy cars” I didn’t have much in the way of cash but had a fair amount of disposable income each month. I made sure I was always putting much more of that into savings or retirement of existing debt than what I was devoting to a monthly loan payment on a toy, and as long as I was doing that I had no qualms about borrowing to buy something fun. Always paid them off early and never put myself in a bad financial position. Yes, they’re luxury items and if you’re living paycheck to paycheck or aren’t really sure you can make the payments every month you should just keep dreaming, but that’s a case-by-case situation and nobody knows the answer to that besides the OP. My two cents’.

Good financial tips for someone to consider is not a bad thing.

Refinancing your house into a 30 yr mortgage and rolling all your other debts (cars and credit card) into that loan is not a good idea. You will still be paying for a car that is sitting in a junk yard, and you will have paid more interest than the original price.

A home equity loan requires good discipline. The minimum payments can be just slightly more than the interest, resulting in 30 yr or 40 yr to pay it off.

It is generally a bad idea to be upside down in a car loan. You buy it brand new and your likely going to take a 20% drop in value the first year. If you didn't put 20% down, you will owe more than it is worth.

Let's use easy numbers. Say you pay $100K and finance it all. One year later a drunken slug totals it for you. His insurance says it is worth $80K and hands you a check. You still owe $95K. Now that the car is worthless the bank wants $15K from you right now. No more payments, because the title no longer secures the loan. No bank will loan you $15K to pay off another loan. Now you are in a pickle.

I would never recommend anyone getting a loan on a new car without putting 20% down. More if the car has unusually high depreciation.

Financing toys is not a great idea, but people do it all the time. You should at least ask yourself some what if questions. If this happens what will I do? Be prepared.

I used Light stream for a car loan at 3.75% 48 months, It ended up being a personal loan with no lien on title.

Always buy gap insurance with your auto loan. Pickle avoided! Hell, if someone wrecks your upside down loan, YOU WIN!

(and gap insurance is cheap)

I'd wager heavily that the OP doesn't have the cash. I'll assert that anyone liquid enough to be able to afford to spend the cash but wants to leverage that position to a place where the income exceeds loan interest, already HAS THE CONNECTIONS TO MAKE THAT HAPPEN!!!

So I'll stick with my original statement: Pay cash for toys.

In 2016 I had the cash to buy my SPF but chose to finance and used Woodside Credit. They were very easy to work with and the transaction was flawless and the payment was $525. I'd highly recommend using them if you are financing. The interest was like 5% which was basically the best or close and they specialize in what I was doing.

I totally understand the perspective that you should pay cash. If you can afford to make payments then you can afford to save up first. Its the only way to go to avoid risk and stay out of trouble. Many people screw that up by getting in way over their heads.

I have saved and paid cash my whole life up until the point where I could start leveraging my own money and make some moves that I was unwilling to make earlier in life. I did not pay cash but decided to leave my $50k invested (non retirement account). I made a lot more money leaving it invested over the interest I was paying on the loan. Once I saw the Carno virus scaring the market I pulled that money and paid off the loan.

In summary I left my $50k invested in good growth stock mutual funds from January 2016 and pulled it out early Feb 2019. It ran up to $91K and I netted $85K after capital gains tax. That is a 16% annualized return. I'm really happy I didn't pay cash for the Cobra because it would have cost me a bunch of money.

Smart @jacobsed !

BTW, I was able to secure a traditional used car loan from my credit union at a ridiculously low interest rate because the car was built less than 7 years ago. I left my money in the stock market, where it now has to recover LOL ��

Just ride it out. Only a paper loss unless you actually pull it out.

Agreed. I got time. ⏳

As above, pay cash for toys.