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Car loan - to take or not?
Rank: Elder Joined: 6/19/2008 Posts: 4,268
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@kamaa
Very true. but i think cars are quickly moving from being a luxury to a need. whats with having to criss-cross town to work,own a house(if you cant afford kileleshwa,milimani etc,you better be making friends with people in juja,ngong,rongai,mombasa road and the like),take kids to school,go for your evening classes and do some side show jobs that complement your day job. You need the convenience and also to save time. Sometimes,its may actually turn out to be cheaper to have a family car than take public means - considering the schools are charging a leg and an arm for transport only. Ask anyone with a kid living on say Mombasa Road and going to school on Ngong Road.... multipy that by 3 if you have 3 kids(which is roughly the average for a typical kenyan family)
Experience is what you get when you don't get what you want.
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Rank: Member Joined: 10/26/2008 Posts: 380
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@Mukiha..
As i said,the decision to buy car is made.. whether its on loan/cash is the issue here.
I am at a point where i need a car to run more errands,and the convenience in it will make me more money in the long run. Its not a luxury.
I appreciate the fact that it is a liability,and will lose value in the long run.. whether its bought with cash or a loan.. it will still lose value.
@stonemimi
Whats the rationale behind taking a bank loan + cash for the car.. and then taking a sacco loan to invest?
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Rank: Veteran Joined: 10/6/2007 Posts: 1,177 Location: Nairobi - Kenya
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@ wendz a car is essential and will always remain a such,but for the owners cum users (in most cases the privileged)... i don't intend to discount its usefulness to the the rest of the world but i must say that it depends with an individual and the way he/she perceives it... i don't know why but i know it is addictive and the same reason make it essential to those who have tasted its goodness... i get to wonder if it will still be essential when the psv sector (road & rail) will be to the like of the western nations... When you run so fast to get somewhere,you miss the fun of getting there... Life is not a race,so take it slowly.... When you hear what I say, you will not understand. When you see what I do, you will not comprehend
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Rank: Member Joined: 10/17/2008 Posts: 338 Location: Kenya
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@Kamaa..psv system becoming like the one in the West will probably happen Post Jesus' 2nd coming. if you are sure you can afford to maintain the car,pay the interest and the repayments then go for the sacco loan and invest the other money somewhere else. i know of pple who get loans to buy cars from banks and fuel the car with an Overdraft from the same bank.. A little Blindness is necessary when you undertake Risk. Think the unthinkable but wear a dark suit
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Rank: Elder Joined: 6/19/2008 Posts: 4,268
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@kamaa
If our public sector is streamlined and becomes like the western nations,then the car will not be as necessary as it would be today and i believe majority of kenyas would be enticed to leave their vehicles home. why,because there will be specific schedules of when the vehicles leave and arrive at a certain destination. that way,every is able to organise his/her around that time.
Picture the current situation and morning dramas where say on bad day day you have fixed a meeting at 9am(and this is not to say if I dotn have a car i wont make it to the meeting) then you go to a bus stop not knowing if yo will get a mat or not. catch one,and you are coming from mombasa road. on reaching GM,the dude decides that enterprise road is better and heads that way. Finds jam at Tetra pack and decides to use mlengo towards south B on some rough road. On reaching the middle,the road is blocked so he goes back to enterprise road (If the bugger is lucky not to be arrested and he refunds you money and you have no idea if to take mats going back to mombasa road or jogoo road!!! daaaaaamn!) follows the jam till city stadium and after getting to that muthurwa roundabout,takes the road going to nairobi river because he has found some jam there na 'amechanuka'.... and comes back to town via nyamakima side and leaves you at 'tusker'.... the meeting is at upper hill and ( and you are lucky if you have no kid in tow to drop at (what's that school opposite jeevanjee gardens?).... now you trek ( and you lucky if its not pouring in this particular morning) again to railways to catch some mats to head to upperhill which drop you opposite NHIF coz the meeting is at victoria towers!!!! all this in a morning!
And dont mis-interpret what i write here... this does not mean i dont use a mat.... on the contrary... i do,all the time... just highlighting the dramas.... on a bad day
Experience is what you get when you don't get what you want.
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Rank: Veteran Joined: 5/20/2008 Posts: 1,126 Location: Nairobi
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... go for the sacco... @ Wendz That's an interesting piece. One thing I can attest to though is that mats,esp. Eastlands mats are the fastest means of transport on land... whether there's a jam or not.... one day just go spend at your friend's in Buru.... the next morning let him take his car ... even map for him the best route... then take a nganya,the likes with screens everywhere,loud music e.t.c.... I guarantee you you'll reach commercial before the guy On the other hand,when there is a bad jam somewhere and you are on a personal car,you might take hours while if you were on PSV,you can easily alight walk on kidogo and take another one.. Anyway both have advantages and disadvantages but top on the car's advantages is comfort When we pray in praise to God,he makes a difference in our lives. JOIN MY FREE MINI-COURSE FOR WRITERS. CLICK HERE
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Rank: Member Joined: 9/7/2007 Posts: 168 Location: Nairobi
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Case scenario Analysis
Assume you borrow Ksh 500,000@12% for three years to buy a Toyota,mmmm say Corolla 110/111 KAZ Registration.
Total Cost of Car Acquisition
Ksh 500,000 at 12% per annum for 36 months = Ksh 16,607 monthly repayment.
Total repayment after 36 months = Ksh 16,607X36 = Ksh 597,852
Plus loan arrangment fee and insurance 3% = ksh 15,000+597,852=612,852
Car's Expenditure for the Three Years
Insurance/year @4.5% = Ksh 22,500X3=67,500
Fuel at ave of 12,000km/ year where the car does ave 12Km/l =1000litersX78(today's price) = Ksh 78,000X3=243,000
Service both major and minor per year Ksh60,000X3=ksh180,000
Miscelanous Costs per year Ksh 30,000X3=Ksh 90,000
TOTAL COST OF BUYING AND KEEPING THE CAR FOR THREE YEARS
Ksh 612,852+67,500+243,000+180,000+90,000=Ksh1,193,352
Basicaly,a mere Toyota 2nd hand will cost you Ksh1.2Million.
That's food for thought
each day is a gift from God; I dont know if I will be here tomorrow; should I be,I'll make the most of it for God's glory; should I be not,pick up and keep the legacy
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Rank: Veteran Joined: 10/6/2007 Posts: 1,177 Location: Nairobi - Kenya
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@ wendz yes a personal car saves the hustle & the madness associated with the mats... @ akowally i concur. mat za buruu are like usain bolt on a track event... @ mkristo that is a good piece of calculations... even though the comfort associated with the private car cannot be quantified.... When you run so fast to get somewhere,you miss the fun of getting there... Life is not a race,so take it slowly.... When you hear what I say, you will not understand. When you see what I do, you will not comprehend
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Rank: Veteran Joined: 5/20/2008 Posts: 1,126 Location: Nairobi
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Yeah,like I said,people pay a lot for comfort. That is why a soda is 20 bob,at Walkers it's 50 bob,at Carni,I think 70 bob,at Stanley 110,et cetera .... and in all these places you'll find people. As long as someone still has his basics,as a Christian he tithes,saves,invests e.t.c. he can pay for whichever comfort he pleases ........ When we pray in praise to God,he makes a difference in our lives. JOIN MY FREE MINI-COURSE FOR WRITERS. CLICK HERE
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Rank: Veteran Joined: 5/18/2008 Posts: 796
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True,if I lived in Buru,I wouldn't buy a car...
Mats are 24 hours,so you can still rave till the wee hours of the morning...
Nganya's don't recognize traffic jams and will get to town an hour earlier than persons in their private cars...
But what about those of us that don't live in Buru...
Where there are no shortcuts or alternative routes for the 20KMs to town...
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