Opinions needed: my financial well being is in your hands!

[greg75vette]

Alright maybe not that serious, but I do ask a very important question. But here is some back ground first...

A lot has changed in the last few months. I'm now engaged, planning (as well as partly paying for) a wedding and my vette is falling apart (more than normal).

As some of you have responded on, I have a thread on a possibly chipped ring gear on my flywheel, which would wind up being a flywheel/clutch/throwout bearing replacement project (assuming I do have said damage). This got me thinking. I plan on doing an LSx/T56 swap to this car. I bought my '75 with that intention. However, I find that I cannot save fast enough to make it happen all that soon. But this flywheel issue (and my throwout bearing has been squeaky since I bought the car 2 years ago) will just drain more out of what I have, thus postponing the swap even larger. To aggravate the issue more, I have said wedding to save for (may 2011). It's a ways away, but now is the time to start saving.

This has made me realize that if I'm going to do this swap it won't happen for a long time (due to the wedding). And in the meantime, I'm sure more things will break, some being things that would be replaced in the swap which will just drag on the delay of the swap.

So the brilliant idea struck my Fiancee (so fancy) to check out loans. Now I know what a lot of you will think of this off the bat, just like I have. Why the hell would I willingly pay the f%#$*!@ bank money?? Well, if I can keep the interest rate down, (<10%) and the term length short (48mos), the interest is significant, but not a deal breaker. Here's why: At 10% interest over a 48 month term, if I borrow $8500, I'll pay $1850 in interest. Seems like a lot, but think of it this way, how much will the clutch/flywheel/to bearing run me plus what else I find? My front and rear main seals are moist (not dripping) and the engine is at 110k miles, so how much does a rebuild cost? Why fix these when they'll just sit in my shed after the LSx swap?

This to me is my cost of avoidance (apparently real as my boss taught me yesterday. Power plants use this comparison all the time). It will cost me less to borrow the money and do the swap now, than save up for 48 months and repair as needed.

A side benefit to this is it would 'lock' what was going to the vette in terms of savings (because it would be a bill, not a deposit) which means the wedding fund couldn't cannibalize my vette saving account (yes, I have one just for it and other accounts of mine have sticky fingers sometimes).

Does this sound logical? I know logic and C3's rarely mix, but is this a real option to you guys or just asking for trouble? As an FYI, I would never bite off more than I could chew. If I couldn't afford the loan, I wouldn't go for it.

 

[mrvette]

Two ALL important questions.....is your JOB totally secure???
and do you presently own a house you like, one with a garage you can work in without killing yourself???? hopefully close to work so you won't die from lack of gas.....

IF either is NO, time to retrace your entire thought process, but that's just ME....

for ME, my first thought was always HOUSE (with workable garage) as #ONE....

all else went to hell until then....

:thumbs:

 

[SmokinBBC]

Two ALL important questions.....is your JOB totally secure???
and do you presently own a house you like, one with a garage you can work in without killing yourself???? hopefully close to work so you won't die from lack of gas.....

IF either is NO, time to retrace your entire thought process, but that's just ME....

for ME, my first thought was always HOUSE (with workable garage) as #ONE....

all else went to hell until then....

:thumbs:

"This to me is my cost of avoidance (apparently real as my boss taught me yesterday. Power plants use this comparison all the time). It will cost me less to borrow the money and do the swap now, than save up for 48 months and repair as needed."

This may be true in business...but not in hobbies.


I'm with Gene on this one. Only 3 things I ever financed. School, house and new car. And it really hurt me to pay those guys so I could drive....house and school I had no problem with.

You can do a lot with $1850...why give it to the bank? If you can pay back >10k over 48 months then you can afford to save up and wait to do the things that need to get done on the vette.

And what you gonna do if you need another 2k after you spend the $8,500? Be wary of going down the path of high interest loans, credit cards, etc. If they start to pile up, you'll be in deep **** in no time.

JMHO.

 

[1Michel]

I wouldn't borrow for the car. It's a hobby.

This is the main reason why I take so long to build my car.
I literally buy the parts one by one and only if I have the money in my hands.

Sure it takes forever considering the economical contex but it's also part of it.

you know, a lot of times when you want something like that, the wait is more satisfying. I mean it's way more gratifying when it's finaly finished plus it gives you time to plan things better.
With a good plan you waste less money on trial and errors and if theres an area where a lot of us tried and crashed, thats right here with this hobby.

It's a hobby, dont forget it!

 

[greg75vette]

And Precisely what I was getting at. I am very weary of all those things. I currently only finance my car and two student loans and have no credit card debt (besides what I rack up for the month, which is paid off every month, like cash). So to me, this is all knew and I must admit very tempting.

I also share your fear of me going over budget. I do believe I can have it done for wel under that, but I do have a little over $2k now in the vette savings.

I know a lot can be done with $1850, but I also know that at least $1850 can go into an engine/tranny that I don't plan on using. We all know how these cars can be in terms of repair. As for the current track record of the car, that's coming quick!

I didn't mention, but probably should have, the fact that with or without this loan, I am and have been for quite some time been saving for a house, repair to said house, "rainy day" savings, retirement, life insurance and starting today, the wedding. I currently save more than what the loan would be a month (with the above example) for the vette alone. So I would be still continuing to save.
Also with the house, I have to wait on it simply becuase I have to wait for the current owner to retire and move out before I can buy it off of him. However, he has pushed his retirement out to, ironically, around may 2011. That's when I get the garage, haha. I don't have the heart to kick out what is currently in the garage, since I grew up with that too.

So what else is a thought?

 

[MYBAD79]

$1850 - that's enough for a Goodwrench engine and a new flywheel/clutch....

Murphy's law says that once you're done with the LS1/t56 conversion and you make payments for the $8500 loan the differential or something else will break - do not take a loan for a toy, just my humble opinion.

 

[MYBAD79]

So to me, this is all knew and I must admit very tempting.

That's exactly how they "work"....

 

[greg75vette]

1Michel, I see your point about research. Like I mentioned, I bought this car with this swap in mind. I thought I would be unique. Right around the time I bought it I signed up "another corvette" forum and not much later, someone started a thread dedicated to the swap and what's involved. Learned a lot from that. A lot that would have burned me bad. Over the last two years, I have continually refined what I would like done and how to do it. The learning has never stopped. I've always been sponge-like.

I hear the hobby argument. That was why I never really considered it at first.

And I absolutely hear Murphy's Law. I didn't name my car Pandora for nothing.

Now if I could only deposit my vette savings into something that would bite anything that tried to remove it...
Mutual funds were another thought, but that is I think longer term that I'm willing to go. Glad I didn't set that up two years ago!

 

[turtlevette]

you're going to need a down payment on the house.

i'm guessing what? 20% of 500k. I doubt there's much for less than that on Long Island.



you got 100 grand saved yet?

 

[greg75vette]

you're going to need a down payment on the house.

i'm guessing what? 20% of 500k. I doubt there's much for less than that on Long Island.



you got 100 grand saved yet?

Well for one, LI doesn't have the kind of market currently. Not even close in most areas. LI is what one would call a soft market. There are very few $500k houses near me. Ours is significantly less.
Second, I'm taking over the mortgage to finish out it's 25+ years remaining. There are closing costs, but I don't need to put down 20%.

 

[mrvette]

you're going to need a down payment on the house.

i'm guessing what? 20% of 500k. I doubt there's much for less than that on Long Island.



you got 100 grand saved yet?

Well for one, LI doesn't have the kind of market currently. Not even close in most areas. LI is what one would call a soft market. There are very few $500k houses near me. Ours is significantly less.
Second, I'm taking over the mortgage to finish out it's 25+ years remaining. There are closing costs, but I don't need to put down 20%.

A couple of MBA bankers with some 6 years each in the mortgage banking business taught me this trick ten years too late for me, I lost too much money in other businesses.....what the trick is....

to find a house in foreclosure BEFORE the bank actually does the dirty....that way you catch up the payments and you set up a TRUST, that trust is filed with the .gov agency as being the 'new owner' of the house, put the name of the trust as same as old ownder...the John Doe trust....so that is filed with the .gov, and of course copies to the mortgage bank, they will think nothing of it, especially these daze, and file it in the folder along with the rest of the paperwork...., NOW, when you make the payments on the mortgage, you can make them from ANY account, it goes to the payment dept of the XYZOO bank, think that clerk cares which account that payment comes from??? hell no, payment accepted and so house is yours....

the trust papers are very rarely if ever actually read over by the bank, get a real estate lawyer....that ensures you can keep that trust forever....YOU/wife are the BENEFICIARY of the trust,

now YMMV with state laws, but that's how it's done here in Florida....had I known that trick some 12 years ago, today I"d be a millionair, and that's no lie, either....

:hissyfit::hissyfit:

 

[greg75vette]

Funny you mention that Gene because that was a similiar skirt around that I was going to do that my financial adivsor recommended. The drawback to the one I would do is the current owner (if you haven't guessed by now, my Father) would continue to be the owner as I was placed on the deed, the house would me placed in a non-reversable trust and I would make the mortgage payments. Like you said, the bank doesn't care who pays, as long as the chekc doesn't bounce and it's on time. ...It does help we have the same first and lasdt name as well as our middle initial... The only down side to that whole process was I would not get full credit for the house until my father passed, as I was the beneficiary of the trust. Only then would the house be mine. Which means I wouldn't be able to claim interest on my taxes and I would officially be a tennant.
The advantage? Don't have to officialy transfer the house and have it count as a sale.

We have since abandoned this idea since I can assume the mortgage. Makes life a little easier.

But still a very interesting trick there Gene. I may have to invest in some property haha.

 

[mrvette]

Funny you mention that Gene because that was a similiar skirt around that I was going to do that my financial adivsor recommended. The drawback to the one I would do is the current owner (if you haven't guessed by now, my Father) would continue to be the owner as I was placed on the deed, the house would me placed in a non-reversable trust and I would make the mortgage payments. Like you said, the bank doesn't care who pays, as long as the chekc doesn't bounce and it's on time. ...It does help we have the same first and lasdt name as well as our middle initial... The only down side to that whole process was I would not get full credit for the house until my father passed, as I was the beneficiary of the trust. Only then would the house be mine. Which means I wouldn't be able to claim interest on my taxes and I would officially be a tennant.
The advantage? Don't have to officialy transfer the house and have it count as a sale.

We have since abandoned this idea since I can assume the mortgage. Makes life a little easier.

But still a very interesting trick there Gene. I may have to invest in some property haha.

Well, hope someone can benefit from the knowledge, ans that **** varies from state/state obviously.....:hissyfit: for the knowledge 12 years ago...

damn if anyone here would think of that, all them mortagae/real estate/finance/banking/credit union/RE Lawyers... people I talked to and not ONE hinted on anything about how to actually DO a freeking deal....useless lot if ever I saw one....thanks for nothing...and they could have made damn good money off it too....

:crap:

 

[greg75vette]

If we only knew some of the wonderful tricks of the rich.

SO who else has an opinion? Let's hear it

 

[turtlevette]

you're going to need a down payment on the house.

i'm guessing what? 20% of 500k. I doubt there's much for less than that on Long Island.



you got 100 grand saved yet?

Well for one, LI doesn't have the kind of market currently. Not even close in most areas. LI is what one would call a soft market. There are very few $500k houses near me. Ours is significantly less.
Second, I'm taking over the mortgage to finish out it's 25+ years remaining. There are closing costs, but I don't need to put down 20%.

The fact that your daddy is giving you a house makes the decision easier. You're a mechanical engineer probably pulling down 60-80k a year.

Get the loan, take money out of savings or borrow against your ira/401K. You're in good shape. Have fun.

 

[68L71]

I would not get a loan for a car...especially a toy car.

 

[redvetracr]

my suggestion...sell the Corvette and buy a minivan, your going to need one sooner or later....

 

[mrvette]

my suggestion...sell the Corvette and buy a minivan, your going to need one sooner or later....

:crap::lol::lol::lol:

I thought that for a second, but did not include it.....way the economy is now, he going to NEED every penny....

 

[big2bird]

my suggestion...sell the Corvette and buy a minivan, your going to need one sooner or later....

Yep. Once your married, unless she REALLY likes them, it's history anyhow. You can be it back for $100,000 when your 50 and the kids are out of college.

 

[mrvette]

my suggestion...sell the Corvette and buy a minivan, your going to need one sooner or later....

Yep. Once your married, unless she REALLY likes them, it's history anyhow. You can be it back for $100,000 when your 50 and the kids are out of college.

U dirty bird, quit shitting on the kid's nest....

:hissyfit::lol::lol:

 

[DeeVeeEight]

my suggestion...sell the Corvette and buy a minivan, your going to need one sooner or later....

That's the answer.

If you are going to finance $8500.00 buy a brand new car with a back seat that you can get the groceries home in. Before you know it you will be looking at car seats for the baby. You need a practical and reliable vehicle. The 'Vette will have to wait.

 

[Dirtbuster1]

Make up a budget for the LSX swap, and anything else for the vette. Have a good plan in hand, and have the members here see if it sounds right.

1. If you shop hard hard for the engine & tranny, you would be surprised on how cheap you could find one. Consider buying a wrecked car for the engine, tranny, ECM, wiring, and all of the other parts that you probably want think of.

2. How much work can you do, & how much will you have to farm out. Your time spent on the swap is free, because you will never get that money back! However, you will have lots of good & bad times to talk about.

3. Play toys are expensive & additive. Make sure to please yourself. & not someone else.

My 2 cents worth

 

[greg75vette]

you're going to need a down payment on the house.

i'm guessing what? 20% of 500k. I doubt there's much for less than that on Long Island.



you got 100 grand saved yet?

Well for one, LI doesn't have the kind of market currently. Not even close in most areas. LI is what one would call a soft market. There are very few $500k houses near me. Ours is significantly less.
Second, I'm taking over the mortgage to finish out it's 25+ years remaining. There are closing costs, but I don't need to put down 20%.

The fact that your daddy is giving you a house makes the decision easier. You're a mechanical engineer probably pulling down 60-80k a year.

Get the loan, take money out of savings or borrow against your ira/401K. You're in good shape. Have fun.

No need to be a dick. And for your information, the house is far from free.

my suggestion...sell the Corvette and buy a minivan, your going to need one sooner or later....

Yep. Once your married, unless she REALLY likes them, it's history anyhow. You can be it back for $100,000 when your 50 and the kids are out of college.

Haha, I knew that someone would say something like this eventually. The vette is safe. Not only does she love it and have attachment (picked her up on out first date with it, proposed in it, etc..) but I have a car with a decent back seat already. The DD is my Ion Redline which has the rear suicide doors so the back seat is easy to get to. Also, she plans on replacing her car (mustang) for a family vehicle.

Although, I could get a minivan and drop and LSx into that...:stirpot:

Make up a budget for the LSX swap, and anything else for the vette. Have a good plan in hand, and have the members here see if it sounds right.

1. If you shop hard hard for the engine & tranny, you would be surprised on how cheap you could find one. Consider buying a wrecked car for the engine, tranny, ECM, wiring, and all of the other parts that you probably want think of.

2. How much work can you do, & how much will you have to farm out. Your time spent on the swap is free, because you will never get that money back! However, you will have lots of good & bad times to talk about.

3. Play toys are expensive & additive. Make sure to please yourself. & not someone else.

My 2 cents worth

Absolutely. I set up an excel sheet for this very job. That's where I got the $8500 figure from. According to my sheet, if I can find the LSx/T56 (plus some typical drop out goodies) for about $3500, the swap should cost, in total $7900. That's including %15 fluffer which I have there for anything unexpected (about ~$1300).

I also looked into doing a truck engine (like a 5.3 iron block) to go on the cheap. But figuring what it would cost to get the accessories and the T56 all separate, seemed to be more expensive. I also added in the cost to convert the engine to an LS1 intake since I do believe the truck intake does not clear the hood. I read a post on another forum (about tech on LS1's...) about doing a truck block, but it doesn't seem to be cheaper. I may PM the author with my calcs to see where I went wrong, if anywhere. I felt some of my estimates were conservative, but I know I still have to add a few items I forgot.

If anyone would like to see this sheet, I'm more than willing to share it.

 

[greg75vette]

And as for an overall update, I don't think I'll do the loan. I pretty much knew doing the loan wasn't the greatest idea, but I didn't want to miss out an opportunity if it turned out that someone here knew something I didn't. I figured this was the best way to bury the thought within my head and never see it as a possibility. You never know unless you ask, right? I'm thinking it is just best to wait. I'll see how my money balances over the next few months since I'm saving for the wedding on top of everything else. If things look ok, I may just start buying swap parts. I have had it in my head I have to buy it all at once, hence the usfulness of the loan. But in actuality, I think I can buy it in stages. I also wanted to buy the majority of the parts at once to minimize the amount of down time the car will have. Honestly though, this swap will still take me a while and not having all the parts would force me to take my time and not fly through it.

 

[greg75vette]

Because I loooove posting so many times in a row, Here's a .pdf -> .jpg -> resized .jpg print out of my excel calc.



Let me know if you see an issue. I rather know now then later.

 

[mrvette]

Just read the rest of this thread, and so looked at your profule...age 24, M/E power industry, and so earning decent money, and you are typical engineer, rather thoughtful and very well organized.....

lotsa things I would like to go back 45 years and redo.....

I hope my son, age 25 is as well organized in his thought processes as you are.....I basically went to work full time at age 21 having not gradded college, and so my son got the degree in 3 but it's just basketweaving 101 type ****....

:sos:

 

[Dirtbuster1]

The 1st item I would buy, would be the motor 1st, & the tranny next. Shop Ebay, & Craigslist every day looking for a deal. Check it out good, & pounce on the deal when you find it. Make sure it stays in your budget so that you don't get off to a bad start. While shopping for the parts, research all the info that you will need to make your swap as easy as possible.

I found a LS1 with wiring, ECM, cats, & all accessories needed for 1800.00. 200.00 for the 4L60E transmission. So shop around & be patient for what you want. Also research what vehicles have the engine combo that you are looking for. Buying all of the parts at one time will save a lot of money. You can sell the rest of the parts to offset your swap!

 

[greg75vette]

Just read the rest of this thread, and so looked at your profule...age 24, M/E power industry, and so earning decent money, and you are typical engineer, rather thoughtful and very well organized.....

lotsa things I would like to go back 45 years and redo.....

I hope my son, age 25 is as well organized in his thought processes as you are.....I basically went to work full time at age 21 having not gradded college, and so my son got the degree in 3 but it's just basketweaving 101 type ****....

:sos:

Just so I'm clear, your son got a degree in three years or has three years to go? If he's out with the degree, good for him! I'm sure he can see it was worth it. I know all of those day sweating over a test or project were worth every second. I'm still shocked I made it through relatively unscathed...

Thank you for the complements. I try to be as thorough as possible with everything I do. I don't mind making mistakes (that's how I learn, really), but when I release something I like it to be right. That goes for major decisions things I make/produce.

Excel tends to be my life with engineering so doing the that spread sheet just made sense to me. Always have a plan and you screwed less, haha.

As a side bar, I'm currently teaching myself Net Present Value since work is a little slow lately and I decided to apply some of this to the engine swap, :lol:

I did a Future Value calc to see if I pay $'x' today with a fixed interest of 'y'%, what will I have in 'n' years? Well, if I save $250 a month for 3 years and earn 1.5% in interest, I'll have $9,135.67. Or if I continue to save $275 a month for another 2 years at 1.5% interest, I'll have $6,649.50 which plus what I have already means I'll have enough for the swap. Let's just hope I can continue to save that much. If I can, I could start buying parts next year and begin the build.

Or the wedding will suck me dry and I'll go back to contemplating robbing banks again :devil:

 

[greg75vette]

The 1st item I would buy, would be the motor 1st, & the tranny next. Shop Ebay, & Craigslist every day looking for a deal. Check it out good, & pounce on the deal when you find it. Make sure it stays in your budget so that you don't get off to a bad start. While shopping for the parts, research all the info that you will need to make your swap as easy as possible.

I found a LS1 with wiring, ECM, cats, & all accessories needed for 1800.00. 200.00 for the 4L60E transmission. So shop around & be patient for what you want. Also research what vehicles have the engine combo that you are looking for. Buying all of the parts at one time will save a lot of money. You can sell the rest of the parts to offset your swap!

$200 for a transmission?! I'm jealous! The best I've seen (for a T56) is about $1,000. I have seen some LS1/T56 packages in the $3k range. From what I've seen, it's cheaper to buy the two together. I've seen LS1's go for what you've paid occasionally, but once you tack on the 1 grand transmission she's get's up there. Not to mention that if I bought them separate I would have to also buy a flywheel (maybe), clutch, t/o bearing and sometimes the bell housing. That's why I've been looking for packages.

I absolutely agree with you that buying as much up front is the way to go. What I would maybe buy separate is things I would have to go somewhere else for, like motor mount adapters.

From what I've found, GTO's and F-bodies are the best donors. GTO's seem to be the best (best gearing and transmission internals), but they go for blood money on fleabay. I think dealing locally might get me the best for my buck instead of fleabay, I hope... That way I have a better chance of hearing it run as well.

I'm also researching now what other parts I could steal off of an F body, like the rad fan maybe (I like my rad).

As far as things I'm not sure what to do about yet is the crossmember mod and the wiring harness. I can't really wrap my head around how to handle the wiring (modding the harness, hooking it up to the car, etc) and I can't weld and haven't done too much metal fabrication in my life so the crossmember has me fearing as well. I may have to farm these out...

Thank you for all of the wonderful tips Dirtbuster

 

[mrvette]

Nah, Tom got bored, so took 20 credits for his last few semesters to get the **** outta there....degreed in 3 years...
but it's not anything tough, like engineering, just basketweaving, not downing his effort necessarily, it's more than I ever did that way, but I sitll repect engineering/tech work a whole lot more, and always will.....

Kinda like that olde movie Fiddler on the Roof......


:chinese: