Quote:
Originally Posted by SP01715
I would never use a LOC to buy a toy, but that's just me. I had a LOC that I used for my business, but it was payed off along the way as the business made money.
As was said earlier, people using HELOC's to buy toys is part of the reason we are in this mess. The only way I would use a LOC for a toy is if I knew I would pay it off it a short period of time (6 months or less) and I did not have the cash on hand if a car became available that I had to have. I think the market will keep dropping for at least a year, so the best deals have yet to be had.
My philosophy is to never be upside down in a depreciating asset. If you are, and have to sell you are going to have to come up with money out of pocket to just get rid of it. My Cobra, 49 Cady, Harley, Dodge truck, off road toy and both of our daily vehicles are all paid for. I don't like bad debt.
I have been buying toys lately with cash for pennies on the dollar. Cash is king in this economy.
BTW, I am not touching my stocks. You have to ride it out at this point.
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I agree cash is king and buy stocks and mutual funds now during the down turn, it wont last forever. Just buy solid blue chip companies not the waivering banks.
I do disagree on the reason we are in this financial down turn because people bought toys with an equity loan, We are in this because the banks gave loans for houses to people who could not afford the house.
They gave them interest only mortgages so 5 years into the loan when they have to sell and the housing market has declined they still owe the original note even though the house has depreciated!
Bottom line is don't spend more than your can pay, don't live off of creditcards! Who needs 10 CC's in their wallet all with a balance!
