Ordering and Negative Equity

[JustKieffer]

Hello!

I’m seriously considering ordering a M3P. I currently own a Golf R but have some negative equity. Does Tesla do trade in’s and do they allow you to roll over negative equity?

Also, I live in a condo with no charge ports anywhere. Is it ok to use solely Supercharger network, atleast temporarily until I move into a new home? Not sure what the cost difference is between charging at home vs. Supercharger.

Thanks, y’all! (Ontario, Canada)

 

[jjrandorin]

Never a good idea to roll negative equity into another loan. Whether they will do it or not depends on what your down payment is (basically how much of the negative equity you will be paying up front, but forcing the new car further underwater).

Also, I personally think that if you dont have access to home charging of SOME kind, you should not be buying an EV. Every car does not have to be for every person.

My advice would be to wait, both because you have no home charging, and because you have negative equity. Solve the negative equity issue first, and really REALLY consider if you want to have to spend time at a super charger every few days (you will not be getting the stated range).

 

[JustKieffer]

Never a good idea to roll negative equity into another loan. Whether they will do it or not depends on what your down payment is (basically how much of the negative equity you will be paying up front, but forcing the new car further underwater).

Also, I personally think that if you dont have access to home charging of SOME kind, you should not be buying an EV. Every car does not have to be for every person.

My advice would be to wait, both because you have no home charging, and because you have negative equity. Solve the negative equity issue first, and really REALLY consider if you want to have to spend time at a super charger every few days (you will not be getting the stated range).

Good call. The negative equity isn’t huge.

The lack of charging port is probably the biggest issue at the moment.

Thank you!

 

[Mixdup]

The charging issue depends on where else you may have access to charging and what your daily usage is like. For example, a lot of workplaces have level 2 chargers available so perhaps you could charge at work. Also, the situation you describe is the thesis behind the urban superchargers. You don't want to use a regular 100+kw supercharger every time, but the urban superchargers are only 72kw so they will be much less stressful on your battery

I live in a condo and can't charge at home, and also don't have charging at work. I still ordered a Model 3 LR and am waiting for delivery. My daily commute is about 12-15 miles round trip, and there is a shopping mall with a large food court and a bank of urban superchargers three blocks from my office. I plan to go charge once or twice a week during lunch and it should be no big deal.

I do plan to probably move eventually, and when I do it will definitely be to somewhere with EV charging capability, but that is 70% because my HOA has ticked me off (and that is only 50% because of their hostility towards EV), and only 10-15% purely because I can't charge at home

 

[MrMassTransit]

I can't speak to the negative equity situation. While Tesla does trade ins, in my experience the value they offer isn't competitive, but I think this depends on a case by case basis. I have a '17 Leaf and they offered me $12k for it. Carvana (which is US only, I believe) offered me $14k. Based on some research, I think I can get around $17-$18k selling it myself, so that is what I'm going to do once my M3 delivery date is assigned. I'd think you'd want to avoid getting even less than the market value of your car if you were in a negative situation. Unless you have incentives that are expiring (the reason I ordered the M3 rather than waiting a bit, given how new the Leaf is), you might want to hold off for a bit and try to pay down your existing loan to the extent possible this year.

Regarding charging, I think it depends how you use the car. I don't have at-home charging with my Leaf, and I won't be getting it with the Tesla. I live in a condo in a city and while I could install charging at my parking space (I'm on the board and the other board members are pretty permissive), I was quoted at over $4k due to the need for an extensive underground wiring run. My hope is eventually other owners will want charging and we can split the cost a few years.

For now, there's a public L2 charger a few blocks away from me (Chargepoint) and I use that to charge my Leaf and will do the same for the M3, plus I take liberal advantage of destination charging opportunities. You can certainly depend on the Supercharging network, but the rates for Superchargers seem to be set at a premium above market rates, and I'd hate to constantly be supercharging my battery. As a result, I'd be hesitant if I didn't have easy access to L2 charging, but I'm sure others wouldn't have qualms existing solely off superchargers (and your situation is one the reasons that Tesla is putting more superchargers in urban centers). A Tesla isn't a cheap vehicle and I would make sure the economics make sense if you're buying all your power off a Supercharger. What I'd suggest is look to see if there are good L2 charging opportunities in your neighborhood or at/near your workplace. Plugshare.com is a good way to research this.

Now, this all comes with the caveat that I don't drive a lot. Any local trips where I'm not hauling lots of stuff are done by transit or bike. I don't drive to work, which is a 10 minute metro ride away (if I decided to, parking would set me back over $200 a month!). The case could easily be made I don't need a car at all (I lived without one for many years, including in a smaller, less transit oriented city than I am in now), but I bought the Leaf to experience the EV revolution at its infancy, and its proved very helpful in operating a side business and making trips outside of the city. My M3 will largely be for weekend trips and regional road trips. It will sit parked for most of the week. If I was dependent on a vehicle to get my to work, I might feel differently. If I considered a gas vehicle as on par with owning an EV, I might feel differently, but I'd just go back to car sharing before I bought the former. But for me, I have absolutely no regrets being an EV owner without on site charging. Yes, it is a little bit of a hassle, but I don't have a situation where driving needs to be the most convenient option for my day to day needs.

This is just my two cents and experience. Some will tell you that home charging is a hard and fast requirement, but I'm not in the camp. But as you can see, I'm in a slightly different situation than most people who are daily drivers and dependent on a car as a primary means of day to day mobility.

 

[Needsdecaf]

Yes, Tesla does trades. And yes, they will do trades with negative equity. The negative equity will show up as a cost on your MVPA, adding to the total you owe Tesla.

How do you plan on paying? Loan through Tesla? Loan through your financing? I did mine through my bank, but I didn't finance 100%, so all the negative equity ended up doing was increasing how much money I paid out of pocket to Tesla.

 

[gobble]

I talked to Tesla is Highland Park, IL about trading my current car towards a model 3. It's a 4 month old 2018 Chevy Volt with about 5,000 miles. Not much doubt as to it's value because it's so new. They offered me something like $6k below the current Manheim wholesale value and $10k below current private party value. Their offer was a joke. As I posted somewhere else, Tesla isn't yet a serious car company and they're really going to struggle once they've saturated the market of those still drinking the kool-aid and they need to start selling cars to the rest of us.

I've been researching the model 3 since they announced the $35k price point and my view at this point is that Tesla is a bad company that makes a product lacking in any real quality control. They seem to treat their employees poorly and have so far found people dumb enough to take cars full of manufacturing defects.

 

[portopotti]

Hello!

I’m seriously considering ordering a M3P. I currently own a Golf R but have some negative equity. Does Tesla do trade in’s and do they allow you to roll over negative equity?

I'm going through a similar situation right now. Tesla will take the trade-in, but if you decide to go through Tesla financing, you can't roll the negative equity into the loan. You'd either have to pay off the difference or possibly look for other financing where you can roll it in.

My negative equity wasn't that big so I decided to pay it off.

 

[ewoodrick]

If you are upside down in a loan and you are looking at renting or purchasing a new house, the last thing you want to do is to take on additional debt

 

[TW14 9LF]

Bit different story here re: trade-in.....when I bought my LR RWD, I had a 2015 Ford Focus Electric to trade. KBB and NADA both were about $11,500 trade-in, $13,500 retail. Prices advertised (both private and at dealers) were all over the map, from $9,000 to $15,000. CarMax offered me $10,000. Tesla offered me $11,500. I took Tesla's offer.

My opinion....people often think their car is worth way more than it really is, and then are insulted when a dealer offers them way less. If you start out with a realistic value to begin with, the insult becomes a lot easier to accept.

 

[Glamisduner]

Hello!

I’m seriously considering ordering a M3P. I currently own a Golf R but have some negative equity. Does Tesla do trade in’s and do they allow you to roll over negative equity?

Also, I live in a condo with no charge ports anywhere. Is it ok to use solely Supercharger network, atleast temporarily until I move into a new home? Not sure what the cost difference is between charging at home vs. Supercharger.

Thanks, y’all! (Ontario, Canada)

Why not get rid of the negative equity first, then see how you feel about getting the top of the line 3?

 

[Mixdup]

Bit different story here re: trade-in.....when I bought my LR RWD, I had a 2015 Ford Focus Electric to trade. KBB and NADA both were about $11,500 trade-in, $13,500 retail. Prices advertised (both private and at dealers) were all over the map, from $9,000 to $15,000. CarMax offered me $10,000. Tesla offered me $11,500. I took Tesla's offer.

My opinion....people often think their car is worth way more than it really is, and then are insulted when a dealer offers them way less. If you start out with a realistic value to begin with, the insult becomes a lot easier to accept.

the problem is when you trade with a traditional dealer, they usually play a numbers shell game with your trade. "we'll give you two grand more than it's worth!" and then make it up on financing, the price of the new car, or other fees

With Tesla being 100% no haggle and essentially trades being algorithmically generated, the shell game is over and people don't like what they see. It's a growing pain that Tesla has to deal with since they are selling their car more like an iPhone than like a car. As Tesla sales go more and more mainstream they have to navigate this a little better

 

[gobble]

Tesla in Highland Park told me to take it to Carmax and they'd match that offer. I was kind of annoyed that they'd ask me to screw around like that. Just for fun I did a Carvana online purchase appraisal and they would pay a couple thousand more then Tesla offered. I would expect someone that's trying to sell me a car to be more agressive on a trade to get my business. Carmax is known for throwing lowball offers out there when they're doing an outright purchase and not taking a car in trade.

Btw, I have a wholesale dealers license and know what my car is worth without having any pride in it's value.

 

[jjrandorin]

Tesla in Highland Park told me to take it to Carmax and they'd match that offer. I was kind of annoyed that they'd ask me to screw around like that. Just for fun I did a Carvana online purchase appraisal and they would pay a couple thousand more then Tesla offered. I would expect someone that's trying to sell me a car to be more agressive on a trade to get my business. Carmax is known for throwing lowball offers out there when they're doing an outright purchase and not taking a car in trade.

Btw, I have a wholesale dealers license and know what my car is worth without having any pride in it's value.

Thats a traditional dealers way of thinking (which if you have a wholesale dealers license you likely know). Tesla is not making money on financing, and they sell their cars to everyone for the same price. They are likely not keeping the cars, but taking them all to auction (unless you are trading in a tesla), so they need to cover whatever they think they need to for that expense.

Selling a car to a dealer (ANY dealer) is always for convenience, not because it pays more money. Its almost always better to sell private party, if (BIG if) one has the stomach to get the calls, take strangers for rides, have them haggle about the car, find out where you live or work, etc etc.

Selling a car to a dealer avoids all that, but never pays as much. Since you have a wholesale license you likely knew that as well.

 

[jkoya]

I’m seriously considering ordering a M3P. I currently own a Golf R but have some negative equity. Does Tesla do trade in’s and do they allow you to roll over negative equity?

Off topic, but the handling of my Model 3 Performance reminds me of my previous 2008 VW R32.