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Repair or buy new car

My husband has a 97 toyota camry with about 150,000 miles on it. His car just stopped working. Turns out it was the transmission. He can replace the transmission with a used transmission (cost 350) plus labor and some sort of cable that broke. Total cost about 1400. We are trying to decide whether to put that amount of money into this old car or to bite the bullet and buy new. Seems like buying now is the worst because of the cash for clunkers run. We would really like to have a hybrid but no deals on them plus seems like more will come in 2010. Any thoughts???

I think that it all comes down to two things:

Your tolerance for a car that may not run reliably
Your finances

Many will counsel that it is cheaper to keep repairing an old car, rather than buying a new one.
I will not deny that this is the cheaper way to do things, but if you need a car that will always start in the morning and will run reliably without stranding you, then this might not be a good course of action. You would save lots of money, but depending upon your work situation, you could put your job in jeopardy if you do not have a reliable car. And, while that $350 transmission is a bargain, how do you know that it will actually work properly a month from now?

At this point in my life I am retired, so other than MD/DDS appointments and various social committments, I don’t have anything with specific timeframes on my schedule. However, since I only own one car at a time, that car has to perform reliably. Once I know that a car will no longer be reliable on a daily basis, it is replaced. (I also tend to replace the car when I get bored with it, usually after 7 years or so.)

If you can buy a new car without seriously depleting your finances, then you might want to treat yourself to a vehicle that will be reliable for many years to come. What is right for me may not be right for you, but at least I have given you something to think about.

Personally, I don’t think I’d gamble on a used transmission. If this were my car I’d have the transmission rebuilt or buy and install a rebuilt transmission. A rebuilt transmission should come with some sort of warranty, which a used one probably will not.

I wouldn’t want to spend that much money and find out a week later that the used transmission is bad.

Of course all of this assumes the rest of the car is in decent condition and the maintenance has been kept up to date. If that’s not the case there could be other problems waiting in the wings.

Only you can decide whether repairing or replacing the car is best for you. New cars cost LOTS of money, and your Camry, with its non-functional transmission is going to have a very low trade-in value.

Actually, now may be a good time to buy. Dealers will be replensihing their inventory and the cash for clunkers program has taken from future sales, so sales are expected to take a nosedive. Combined with the fact that dealers have not been getting their CFC chaecks, they should be desperate in another week or two.

Great points have already been made, buut much depends on the overall condition of the vehicle also. Can you enlighten us as to its condition?

First of all thank you to all who have replied. You are amazing! Good point on the post cash for clunkers situation.

Re; condition of car. It is mixed. There is some rust on the exterior. It is in a few spots – not everywhere but visible. The inside is cloth - tired but otherwise reasonable. It has a moon roof. It has been very well maintained. We just bought 4 brand new tires and have 4 one year old snow tires.

We dont love this car (since it is old), but we have no car payments to make.

Another factor – we can do a lot of driving depending on the time of year.

I am waiting for my husband to get out of a meeting to see if he has anything to add.

With respect to the transmission. We were told it came with a 6 month warranty.

Thanks again for your comments!!

Well, with a 6 month warranty, I’d take a gamble. If it fails after the 6 month period, then trade it in($1400 over 6 month warranty period is about $234/month, which could constitute that many car payments). In 6 months time, I’m sure just about every car salesman will be frothing at the mouth for ANY sale.

Are you sure the rust is only on the outside? Push hard on the rusted area to see if it gives way. If it does, there is rust inside the panels. I’d get a newer car under the circumstances.

Are you interested in a new car or a used one? C4C should have pushed demand to new cars at the expense of used ones. If you want a different car, decide how much you are willing to spend and what you want in a car. The see what new and used cars meet your criteria. You might find that a 4 year-old car has what you are looking for and at an attractive price.

If the warranty covers both the tranny and the labor I’d be inclined to go for it. The car should have another 100,000 miles in it, maybe more, and that would make it worth it.

What does the six month warranty cover? I’d want to read the warranty before I agreed.

If the warranty is good, I’d fix the car and keep driving.

I still like the idea of a rebuilt transmission, however. That’s what I’d do if it were my car. At least I’d check the cost of a rebuilt transmission and compare warranties.

A '97 Camry that has been properly maintained has the potential to last 300,000 miles or more.

How do you feel, and how does your husband feel, about keeping this car for, say, five more years?

The answer to that question, especially since you say you don’t love it, might make all the difference.

If you install a used transmission only to trade the car a few months from now it’s not worth it. If you have new car fever (your original post makes me think you do) you should just start shopping for a new car.

There are still good deals to be had. The CFC program is over and showrooms are once again devoid of customers.