[VeryCoolAlan]

Don't know if this is the right place for this thread but anyways...

I am currently 20 years old and I currently am saving up for a 2004 Lamborghini Gallardo (since it's the cheapest one)

Currently looking to put a down payment of 20-30k with the rest being loaned out. (So about 50k loan)

I currently have a BMW that I am finishing paying off this April (exactly one year) it was only $12k.

Now I have read that banks will not loan that big of an amount since they need more time to make sure you can make the payments before loaning out that much money?

I hope some of you can enlighten me!

 

[SGBoise]

What you are saying is that you can easily save 2.5k each month for a year then your finances shouldn't be a factor. Your problem would be showing the bank your maturity level.

Do you live in a house with equity or do you rent? Do you have a generous emergency fund? Do you have any net worth?

If any of those questions are no then an exotic car is probably the wrong path at your age. If yes then good for you and the bank shouldn't have problem lending you money.

 

[Shark01]

Based on what you said you made on your last post (<$50k), not happening with standard lenders.

OTOH, if you're willing to pay upper credit card level rates (25%) you might find someone.

 

[Hym3n]

I'll copy the exact same post I wrote for you on 10/31/15.....

As a fellow "younger" member here (27), I can easily remember being 20 and lusting after Lamborghini ownership.

VeryCoolAlan, you're just not there yet brother. I work as an auto Finance Manager and by all means, if you have the means, there's nothing inherently "wrong" with financing a car, but as a general rule of thumb, you are not going to be able to successfully obtain a loan for a car like this without hitting some MAJOR criteria first:

-Comparable credit: You must have auto loans of similar size ($$$) and duration (monthly term) on your credit before even THINKING about pulling the trigger on a car like this.
-Outstanding credit: Even then, many lenders are just going to laugh at you when you tell them what you're trying to pull off. You will need to have several years of paying higher-sized payments and perfect credit history in order to get approved.
-Loan-to-value: On cars like this, a bank wants to see a sizable investment come from you before they'll consider giving out a loan. Think <80%. So if the car of your dreams is currently worth $100,000, even in the best scenarios, lenders typically aren't going to be willing to allow you to take out a loan of more than $80,000 on the car, which means at least ~$20,000 down.
-Payment-to-Income (PTI): Even if all of the above is in good order, most lenders aren't willing to grant a loan to someone without adequate income to repay the note. In most cases, this number will be <18%. That means that if you make $4,000/month, even in the very BEST case, you would get approved for a ~$700/month payment. To put that into perspective, that is about 1/3 of what a payment on a $80,000 note at 48 months would be.

And even then, provided all of the above financial parameters make sense to both you and the bank, you are left with a slew of other considerations: registration, taxes, maintenance, fuel, insurance, champagne, valet costs, steak dinners... in short,... you're just not there yet. Making $50k at age 20 is GOOD, but its going to take more time, more money, and more planning to just "f*** it" into a purchase like this.

Keep pushing. You'll get there soon enough.

 

[Jr Mint]

Credit depth is very important when trying to get a loan for a substantial amount of money. Loan to value ratio isn't the only thing banks look at. Banks find it very important to know whether or not you can handle a payment of significance. Getting approved for a new car under 50k, or a used car under 35-40k is a far difference case than an older exotic for 90k. You will need a substantial loan under your belt(50-60k,) a down payment of 25%(regardless of credit depth or history,generally required 100% of time,) reasonable income to afford car plus other expense, and you'll be good to go. Age is not relevant as long as the above criteria is met.

Good luck.

 

[Apex]

Alan, I do not have a stable job but a job with potential none the less, on the side I invest in the stock market, I won't give a exact number cause thats a bit to blunt but I have somewhere between 6 or 7 figures and I STILL don't feel comfortable buying a lambo without a solid book of business or a good salary based job (I'm commission only & just started this job). I am 24 years old if that adds any perspective for you. I want a lambo VERY badly, I don't want to dip into the funds I worked hard and got lucky on. I say all that just to drive a point home, WAIT! I know life is short and we all want to enjoy it but its not worth the risk but exhausting your funds and as you stare at your lambo in your garage 5 months in.... you won't have feelings of excitement you'll have stress and worry instead. I'm not saying don't take risk, I'm just saying be patient.
The top predators in the world are the patient ones.

 

[sam23]

VeryCoolAlan...
I hope you didn't simply forget that you asked essentially this same question before or think that asking it again would yield different results. Neither choice reflects well on you.I also hope that you don't disappear like the last time...
Hym3n wrote out an excellent response and I can't stress it enough.

It is not your age (directly) that is a factor. Age is an incidental factor. Anyone can get a loan if other more important factors are in line. Those factors are hard to achieve at your age, and you know you probably don't have them...yet. The first and most important factor is your income. While $50k/yr is pretty good at 21, it is not sufficient to cover a sizeable car loan such as one for a Gallardo. Lenders are unlikely to give an auto loan that costs more than 15% of your yearly income (the national average is 10-12).

So, let's calculate:
~12% of $50k (yearly income) = $6k = $500/mth.
How much can you finance with a 5 year loan at 5% interest with a monthly payment of $500?
About $25k.

You can't get a Gallardo for $25k, unless you put $50k-$75k down (don't forget taxes and tags). An attempt to get a larger loan will put you over the threshold (~12% of income) and greatly increases the chances that the loan application will be rejected. Lenders don't care whether you have other expenses or not. They simply don't want to take the risk that you'll default. While it is possible for some to get loans of 15-20% of their income (rare, but possible), you will need a sympathetic lender and other stable factors to prove that you are good for the loan. These include a long history of loan repayments, history of different types of loans, a long and stable employment history, other sizeable assets, etc.

EDIT: I forgot that you mentioned in the last thread that you made "less than $50k". We have been calculating on the basis that it is $50k. With less than $50k in yearly income, the amount of a loan that you can secure goes down. As others have said, this is not the time for you VeryCoolAlan. Even with $20k-$25k down, you will not be able to get a loan for the remainder of the cost of even a 2004 Gallardo. You will need to save up another $25k or more (depending on your income). It might take a few more years, but it is doable. Formulate a good plan, work hard, and diligently towards your goal and you will be able to do it. Once you have enough, don't forget insurance, maintenance, and other expenses of ownership. It's not enough to be able to buy a car...you have to be able to afford ownership costs too.

 

[acmw]

it is possible, at 17 , almost 10 years ago i got a loan for 13k , 0 down. For a motorcycle which is harder to get a loan for here in NJ due to weather i believe .

At 21 , i got an 80k loan for my 2nd car an m6 , so yes you can get a loan for a G

 

[Bxtech]

Definitely some very good advice here! As usual, sam23 has a lot of good points to think about. Then, with Hym3n being an auto Finance Manager, you're getting it basically straight from the source. Apex also brings up some good points about the potential stress and worry factor.

I basically can't really say much more, except what everyone else has said......Not to buy right now and save up more down payment before you do.

However, we don't really know your situation. As SGBoise asks, do you own a house? Maybe you have a home that has a lot of equity and you could take out a HELOC at a good rate, or other assets like stocks, etc. in which you can use as leverage? If you don't own a home, it might be a better idea to shop the real estate market before the Lambo market?

 

[Russk]

You should be talking to your bank not us. I can say with confidence there is someone or institution that will loan you money, just need to start asking. I'm also confident you will get a haircut in the process.

 

[Shark01]

OK, lets say I can be persuaded to lend you this money, which I could provided there can be an agreement on your fitness for such a loan and an agreement on the specific car purchased.

Lets say this car, plus taxes,PPI,shipping, initial repairs needed, etc is $100k (the minimum really for a good early Gallardo). Lets say you put down $25k on a $75k loan at 25% (a legal interest rate in Texas) for 5 years.

Here is the breakdown:
Monthly payment: $2201.35
Total interest paid over the 5 years: $57,080.56

So on your $50k salary (about $37,500 take home ($3,125/mo)), your car payment alone would be 70% of your take home....and THEN your insurance agent will want his cut of a 21 year old exotic driver.

My checkbook awaits sire

 

[Nemoo]

You got some great and very valid advice from some very experienced gentlemen here.
My advice simply put is focus more on building yourself, finances, and situation where you are able to buy a car comfortably. Buying a gallardo comes with a price when purchasing the car, maintaining, and insuring a car like that.. Good luck!

 

[VeryCoolAlan]

Thanks for the great feedback!

As for the last time I posted I just forgot I had made the thread months ago that is why I have made a new thread.

This is not disappointing to me at all as I pretty much expected this

I do have a buddy though that is 20 and bought himself a 2004 Gallardo, his previous car was a BMW M5 2001, so it IS possible to do it. He financed half of the car ($50,000) so someone gave him the loan.

 

[VeryCoolAlan]

Very true, I do not own a home I live with my parents, making almost 50k I only spend on what I need, have credit lines that I pay off every month COMPLETELY, but since it is as difficult as many people are telling me, maybe I should put EVEN more money in the down. Maybe 50k instead of the 20-30k I almost have saved. Not a problem.

Very funny because a lot of people tell me "Alan why don't you just buy a house? "

 

[sam23]

Very true, I do not own a home I live with my parents, making almost 50k I only spend on what I need, have credit lines that I pay off every month COMPLETELY, but since it is as difficult as many people are telling me, maybe I should put EVEN more money in the down. Maybe 50k instead of the 20-30k I almost have saved. Not a problem.

Very funny because a lot of people tell me "Alan why don't you just buy a house? "

Glad to see you back, VeryCoolAlan!
You'll understand the import of that last sentence when you can fully appreciate the difference between a depreciating asset and an appreciating asset. Investing in a house will pay much more dividends in the future than a car. In fact, putting a ton of money into a vehicle can actually hinder your growth and ability to afford luxuries in the future. That is why most successful people who can afford such cars can do so because they put their money into the right things first.

 

[Bxtech]

Very true, I do not own a home I live with my parents, making almost 50k I only spend on what I need, have credit lines that I pay off every month COMPLETELY, but since it is as difficult as many people are telling me, maybe I should put EVEN more money in the down. Maybe 50k instead of the 20-30k I almost have saved. Not a problem.

Very funny because a lot of people tell me "Alan why don't you just buy a house? "

Yes, Alan....Why don't you just buy a house?? lol! j/k. Seriously though, people who are asking that are saying it with good intentions. You can never go wrong with long term property ownership. Definitely a good place to put your money.

As for your situation, it really sounds like you have a good head on your shoulders, are responsible, and have a good sense of how to handle your finances. With that kind of attitude, you will DEFINITELY be a Lambo owner someday if that's what you really want. If you manage to save $50K, you might as well go for saving the full amount as $20-30K more is so close within reach. Patience is the real key and that is the tough part imo.

As for financing, with good credit and a $50K job with very few outstanding debts.....I'm sure you'll be able to get a loan somewhere. Is it the best choice? Probably not, but that would be up to you to decide if it is. You need to see if you like the terms, interest rate, and how it might potentially put a hold on your other goals in life that you might have. It would definitely put a delay on owning a home if that's on your list.

 

[Korntera]

So your going to live at home with a Lambo? When are you going to move out? How do you afford a $20,000 breakdown, I had a friend that had a 20k breakdown a few months into ownership, are you going to daily drive your car or have a second car. Hell I had a $1500 beater as a DD for a while so I could get a sports car(not an exotic).
Have you called your insurance agent? It could be $200 a month it could be $1,000 a month.

I think you have a lot more to figure out besides if you can get a loan. I wanted a Ferrari 360 since 1999 when they came out, I was fortunate enough to drive a 360 and 04 Gallardo in 2004 and since then wanted the Lambo first. I could have bought a Lambo a few years ago but bought a second house first, bought 4 business, got married and had a kid before buying the Lambo. I'm not ashamed to say I financed mine because I could have paid cash but I would have given up other things like my rental. Instead, my rental nets me more than my payment and with delayed gratification I own an income property and a toy. With the last business i purchased I could have bought a car with the income but instead I have paid off the business in 10 months so I can use the income from the business to buy another car.
My purchasing is probably not like many here, but when I buy something I invest in something else first and use the money from my investmwnt(often 20% or less) for fun and the other 80% I use to grow my networth.

 

[VeryCoolAlan]

Hey thanks for your response.
Yes I will be living at home. I barely have any expenses. My insurance on my BMW is $125/mo which is more expensive since it's a luxury vehicle. Lambo or Corvette is about $300-600 on State Farm. So I'm not worried about that. Moving out whenever the heck I can lol I'm not ashamed to say that I live with my parents like everyone else . I'm not like a loser in their basement lol. But if there was a $20,000 breakdown (which I highly doubt because I'm extremely careful with what I buy and check everything out before I put money down, only the clutch is what I'm expecting to pay yearly as well as some gaskets or minor things only a few thousand dollars a year) I can easily pay for it...the first time . Trying to make this my daily car. But might get an R8 since that's getting better reviews for a daily car.

I have no tickets no nothing . I've been extremely careful. Where I know some people say that their insurance is so high and they don't know why. And they fail to mention that they have had 5 tickets in the past 5 years. When I've been driving since 15. About to be 21 and 0 tickets. 0 accidents. 0 anything. (Knocking on wood)

Literally have been researching for a whole year to be exactly sure I can afford this . and surprise! I can!

But there will be sacrifices made and I'm totally fine with that. It's worth it in my opinion even if it's losing money every day.

I don't care about how much I drive it. I'm not trying to please the next owner happy. If I wanna put 100k miles on it and pay $50k in services. I'll do it .

Because then again barely anyone has a Lambo?

 

[key03]

Are you on your own auto policy, or listed as a co-driver on your parents Policy? First order of business for me at your age was to get out of my parents house. When my son graduated from college he never came home. I cannot understand this living at home phenomenon at all.

 

[Korntera]

The R8 would probably be a better choice, much more livable, newer for the same price so less chance of a repair. Even being careful a $20k repair can happen. Look in the Gallardo forum for transmission issues with a poster with GTR as his username, it happened.
Have you considered a GTR? Probably less expensive all the way around.
However I will steal somebody else's saying, no Lamborghini owner ever looked back and wish they bought an R8 lol.
Good luck and post pics of whatever you get!