Thu 29 May, 2014 11:45 pm
My '08 Scion xB with 80k miles was recently in a Colorado hail storm and sustained many dents to the roof, hood, and drivers side. The damage is extensive as there are several dozen dents but they are not deep and only noticeable in the right lighting conditions.
Despite only requiring paint-less dent repair, my insurance company declared the vehicle a total loss. They offered me two choices. Option 1: The insurance company will buy the car for $10,269. Option 2: I can keep the car with a cash settlement of $5,925 with a clean title as it is over 5 years old (I am not required to get a 'hail title').
The car has some other minor cosmetic issues but is perfectly mechanically sound and drives great. I had inspections with my last two oil changes at different shops and both mechanics commented that the car was in “surprisingly good” mechanical condition. KBB.com says it is worth $9,574 (poor condition) to $10,499 (good condition).
I am getting a raise in December and can afford a new or used car at that time with a budget of about $30,000 but would not like to purchase a car now. I have another vehicle with a $300/mo payment and we make extra payments of $150/mo but owe $13,000 on it. Our original plan was to pay that car off before getting a new one and leaving the $300/mo in-budget with no impact to the raise income. I have excellent credit.
I don't mind driving around a dinged-up car but do not like the idea of having only liability coverage (I don't think I can have more than that).
Plan A: Fiscal Prudence. Keep driving the car with only liability insurance, take the $5,925 and invest it along with the savings from going from full coverage to liability until we have the other car paid off and use it for a down-payment on a new car keeping the same $300/mo payment. The old xB can then be kept as a hand-me-down vehicle for our kids (5 and 3), a loner car for guests or friends in need, or traded for a cheap chore truck.
Option B: New Car w/ Double Payments. Buy a new car. I take the $10,269 from the settlement and use it for a down payment. I take $2,100 from savings to carry me at $300/mo until I get my raise in December the use the raise to cover the additional car payments. Once the other car is paid off, we can move that $450/mo back into savings. Some examples:
- '13 Infiniti G37x w 7k miles for $28,981 AWD v-6
- '13 Acura ILX Certified pre-owned with 1,720 miles offered at $27,981 through Acura (or the hybrid for $28,900).
Option C: New Car w/o Double Payments. Use the settlement and some savings and negotiating to buy an older used car outright. An example:
- '10 Mercedes C300 w/31k miles for $19.9k w/ AWD and E85 V-6
So what do you think I should do and am I missing considerations?
Option D, and it's based on rumor; not experience.
On a warm day, get a pair of gloves and a few pounds of dry ice. Press the dry ice into a few dents and see if they pop out like they are supposed to. If that works, take the cash option and get busy.
I heard this from my son many years ago. He's not real smart, but even a clock that's stopped is right twice a day, and dry ice is cheap in this context.