Financing a Complete/Partial Build

Has anyone ever financed a partial build? Like if I took the body off and sent it/farmed out the work to a shop?

Hell, for curiosity's sake (and because it'll come up in searches), has anyone ever financed a complete build (either for parts so you can finish it all, or parts & labor, farming it all out to a shop)?

I'm just curious what folks have done. These days, noticing that I have time, money, or space )but not all at the same time) makes me wonder about things like this. I'm also curious about alternatives to a second mortgage.

I'd love to hear your thoughts.

~Jason

 

I have financed some parts of builds (mostly motorcycles for me) at the end of the project. Save up buy parts...save up, buy more parts...sell old parts for new parts...save up for more parts..... once I get sick of that cycle and just wanting to get the damn thing done, I usually start buying stuff on the good ole visa card just to get it finished. I NEVER let the balance carry for more than a couple months though. I do upholstery work, so I am fortunate that I can trade a lot of my work for paint work, so that helps.

 

My wife's VISA always works best for me.

 

Finance? Like take out a loan? Hell no..... never.

 

I did. But it was for a very small portion, at the very end, just to get it finished up at the body shop. Not exactly how I wanted to do it, but the rate they gave me was 1/2 that of any credit card out there. I would never finance an entire build, that could get way out of hand.

 

I never buy anything I can't pay for.

 

With the economy being what it is I would say no to borrowing money to build a car,,remember,for most of us this is a hobby and not a necessity.

If I order parts with a credit card I know I have the money to pay in full when the bill arrives in my mail box,,If I don't have the cash to back it up I wait until I do.

A second mortgage to build/buy a car,,never! HRP

 

I never buy anything BECAUSE I can't pay for it! Which is why I spend the majority of my time in the planning stage.

 

There was a time, when I was still working, overtime was plentiful. I worked 3 to 4 shifts extra per week. I was banking $2000 a month, just in overtime pay. My paint job was $8000 and the upholstery was $3500. Paid cash for both and bought another project. That was back in 2001 and I still have left over money in the bank.

 

I only got a loan from the bank to buy shop equipment, like welders, plasma cutter,and almost all you need, but i needed one for other more important things, so i just jumped on the chance, knowin i would have never bought any of that stuff otherwise.

A few years ago, after i realized that w/ my paycheck i would have never been able to have work done by someonelse i decided i needed to do everything myself, so buying tools can be seen as a long term investment, sooner or later i'll be able to a have a sidejob w/ the skills ive learned.
If i had a good pay i wouldnt mind having to do monthly payment for a good car, but as of today 2 to 400 a month shaved off the check would kill me.

 

Personally I think it's a terrible idea. As others have said, if I can't pay cash for it I don't need it.

I think people over-borrowing on credit cards, 100% + home equity loans, etc. is part of the reason the economy is in the shitty condition it is.

But I could be wrong, it's happened before.

 

oh boy,,never ever..the only things i charge are things i know i can payoff in full when the bill comes in...if i cant afford it, i dont buy it period

 

I don't use credit cards for anything, nothing wrong with people who do, I just don't. I did run across a '39 Olds Coupe gasser project I knew I had to have and borrowed some money against my old Harley at the credit union with a short term loan to buy it.

 

I've considered farming out bits and pieces of my project here and there too...body work here, engine/trans there, steering and suspension somwhere else...but all of it sort of came to a grinding halt when the local shops would give me hourly rates (none less than $90 in this area). For less than $30 I bought the shop manual and am slowly figuring things out on my own through parts catalogue's. A few trips to Harbor Freight for the tools I needed and I'm my own mechanic now (sort of). The only problem is I have little personal time for work on the project, so it's not getting done at the rate I'd like it to. If I paid someone else to do it, I wouldn't have the money to ever see it again!

 

While I agree with most saying do not go into debt for a hobby, there are times when it does make sense.

I'll explain. I have worked very hard to have excellent credit and do not have much debt other than that which is directly related to my business (which covers itself).

Due to my good credit, I have a couple of credit cards with high limits and no balances. The cards are constantly sending me offers for no interest for one year with a 3 percent fee for each transaction.

I have been able to use this to my advantage by buying smart and make the right modifications to cars I buy.

Here is an example:

I'm scanning the HAMB or Craigs list and see a car that I like that is a good value. Both have to be true - I don't buy what I don't like, and I cannot over-pay just because I like the car.

So I buy the car with a credit card check for $20K. It is interest free for 1 year and cost me $600 (3% transaction fee).

I drive the car, enjoy it, and make some mods that improve it somewhat.

At the end of the year, I sell the car for $22K. I've made $1,400 bucks on the deal and got to enjoy the car.

There are a couple of important factors. I have two cars completely paid for and a third on the card. I never get into a position where I could not sell ONE of them and pay off ALL hobby related debt. With this 3 car arrangement, I only need to sell one car a year (doesn't matter which one) to cover all car related debt.

Everyone around here thinks I'm loaded (not true) because I am always driving a different, and cool, old car. (they also think I'm crazy for not holding onto some of the cars I've had ) I have just made good decisions on what I buy and make my money and good credit work for me. The way things are going, by reinvesting profits into the next project, I'll will have 3 cars debt free in a few years


That said: NEVER PUT FAMILY FINANCES IN JEOPARDY FOR A HOBBY!!! PERIOD!!!!!!

I'm sure this will raise a few objections and hope it doesn't start any drama. It's just a system that works for me.

P.S. - NO, the '34 isn't going anywhere - so don't ask!!!

 

Edit: Daddy'o, thats a good system, and i understand it well, but you need to start somewhere, and if you are broke to begin with, its gonna take a few years to get to that point.

But thats where i hope my side business is goin to lead me eventually, y'know, just do that much work x month to cover the monthly rate...or in a perfect world a second full income.

 

Not no, but hell no. The only financing I do is charge on a Visa to buy a part, and I use Paypal for that, if possible, then pay the bill at the end of the month. If you gotta finance the build, I would not recommend building it, expecially in these times.

 

I've never financed any part of what I consider a hobby, cash only. Any stuff I order via the internet or phone is paid for with a credit card, and the credit card balance is paid off at the end of each month, before any finance charges are applied.
At this point, with the economy in such turmoil, I wouldn't finance anything unless I absolutely had to.

 

That's a swell idea....I'll go borrow some money, so I can burn it.

 

If you can't pay cash for it, you can't afford it.

 

"Just say no!"

 

NEVER build a car on credit period. If you can't pay cash.. you cant afford it, end of story. IMHO anyone thinking about going into credit card debt to finance a hobby needs to spend some serious time on Daveramsey.com

 

Your right about starting somewhere. I started with $3,400 '56 Chevy truck in 2002. You just have to start small and work your way up. The main thing is to be realistic about the value of your cars before you buy them. You must know what it's truly worth, not what you would like it to be worth.

Also, I did actually have all 3 cars paid off until I took out a loan against one of them for expenses related to the new house we just built. Also, again, that loan was only for about 1/2 of what the car is worth. The interest on that loan is puny compared to the profit I will make on the car when it is done and most importantly THE FUN I WILL HAVE WITH THE CAR.

I want to be clear, I am a car guy and do it for the love of the cars, not for money. 5 years ago I never would have dreamed I would have owned some of the cars I have had. I have been truly blessed and can't wait to see what awesome rides come my way in the future.

One thing I can't stress enough, is establish and maintain excellent credit!! If your credit score isn't 760 or above get it there - and never let it drop. It may take some lean times to get there, but it is well worth it in the long run.

 

Thus far, I've been trading for what I can't buy outright, and have done about everything myself. And I'm sure you can tell I'm frustrated with lack of time to work on it due to family obligations, and am just wanting the body finished to help fast track this project. Hell, my 6-year-old daughters have been helping thus far - with that much done, we could easily finish it in no time!

It's probably the impatience talking, but I was curious what others had done, if they had done any financing, and the outcome. I wanted to hear exactly what you guys said - and thanks for that! I also was looking to hear horror stories!

And well, out of morbid curiosity I was curious what financing options there were out there, as a second mortgage/home equity line of credit for a car is jack-assery, and I steer clear of credit cards. Hell, the only debt I have is a home loan and a student loan, besides the Mrs' new Challenger - and when THAT comfortable payment goes away for the Challenger, the money that went to that will go towards my all-out, balls-to-the-wall effort to finish my car. So I wasn't looking to over-extend or anything - I was wondering if there was a way to make my car my daily driver before the gentrifying Ranger I've been driving kills itself (I hate to pump time and money I could've been using on my car to fix or replace something I hate driving).

Someone once told me when I was a stupid kid I could walk to the credit union and take out a loan to finish my car, and then pay it off like a new car loan (it would be about the same price) as I made it my daily driver. I was laughed at at the credit union when I asked (like I said, I was a stupid kid), but the concept has lingered in my mind all these years, and I was curious if anybody had ever done that.

~Jason

 

My paycheck goes directly into family expenses and savings. I take small side jobs in my field and keep that as hot rod money - separate personal account. And I keep one credit card that I use exclusively for the car. That bill gets paid in full each month.

Taking a lone (including cc bills that I can't pay off in a month) or using household funds to pay for my sickness - ehem - PROJECTS is out of the question.

 

Since I've been trapped into building on paper these days, having limited time to physically work on it, I've been separating large jobs into smaller ones with a project management app on my phone, as well as entering pricing to have more of an organized budget so I know how much I'll be spending when. I'd never considered getting a separate account at the bank!

That's brilliant!

And like you, I sink everything money-wise into bills and the family. Parts-wise, I try to trade my ass off on Craigslist for those - that's one of the only reasons I'm almost finished collecting parts!

I try to take on side jobs, but I work on Apple/Mac stuff, and nobody's ever breaks around here! Besides, of late, the computer repair biz kind of sucks, being cheapened by, "Oh, my brother's real good with computers" attitudes. You'd think it would bring me MORE business, all the stuff they screw up!

~Jason

 

Cash for everything unless it's the nickel and dime shit. I only resorted to a credit card when I couldn't give me wife a definitive answer how much it would cost to finish my 35. So fluids, and multiple trips to the parts store as well as the early ford store and the misc stuff went on a card. Nothing major just a couple hundred dollars worth and then it gets paid off in a month or two.

Big ticket items and cars get paid for in Cash though. If I don't have it then I don't get it.

 

I took out a short term note against a Sansuey (sp) Stereo back in the mid-70s to buy an 80" Harley Engine (ULH). Now those were the days when you could take out a note against your stereo.

Back in the '90s believe it or not we took out a note against my couch with American General Finance. They gave us a grand with the couch as collateral I used it to buy a parts hauler ( '80 Dodge Power Wagon). I still don't understand whay I could borrow money against a couch but not against the Power Wagon.

Actually if I had any money laying around I would loan you cash with your arms and legs as collateral. Only 30 percent compounded dailey.

It is not a good diea to borrow to build a car or a bike. It just always ends up being a bad situation.

 

I actually did borrow for a part for my truck once. I was 19, working at the junkyard, they had a bed I wanted, yard owner said I could get it now, and work it off. It seemed to take forever to pay off that $100 at $3/hr, I didn't have gas or food money for a few weeks. It was a good lesson for me.

 

Jason,

Fix mobile devises! My wife broke the glass on her iPhone the second day she owned it. Smartphones and tablets are the future and at $600 + they're not exactly disposable.

...but yeah, I can fix me Mac too.

~ Carl