How important is a student loan?

[Pitman]

Reason why I ask is, I'm in the market to purchase a used vehicle, but I still owe about 4K, which is in deferment because I'm still in school at the moment. So I'm thinking should I hold off on buying the car, and pay off the student loan in about a month or two, or should I leave it in deferment, continue to pay $700/month, and purchase the vehicle?

FYI - I have no other debt.

Any help will be appreciated.

[zetta]

If you're able to get by without a car for now, the ideal would be to pay off your student loan, then save up for a few months so that you can pay cash for a really cheap car.

If you absolutely must buy a car now in order to get to work or school, then it would depend whether the car loan or the student loan has the cheaper interest rate. Again, go for a cheap beater car to minimize your expense, and save up so that you can pay cash for your next car.

[swanson719]

it makes no sense to go out and buy a car in cash but be paying $700 a month on a student loan. If you pay off the student loan and then go get financing for a cheap-o used car, and pay it off ASAP, you'd be better off. That's only if you can get financing for the used car, as opposed to Ford or GM saying they will only finance you for a brand new car, which is how I ended up paying my stupid tax.

[disneysteve]

I'm not really sure what your question is. If you need a car now, buy a car now. If you don't need a car now, wait until you do need a car to buy one.

I also don't quite understand where things stand with the student loan. You say you are in deferment but then say you are paying $700/month. You say you owe $4,000 but could pay it off in a month or two. If it is deferred, why are there payments? And if you have adequate savings to pay it off in a month or two, why not do so?

[Runaway Finances]

I agree mostly with disneysteve. But I'd focus on the word "need". Most of the time we "want" a car, but don't need a car. If you have wheels now and it gets the job done, then pay off the student loan, save up money and when you have enough saved to buy a car, then buy a car.

By the way, student loans are not written off in bankruptcy so I would pay off student loans and IF I HAD TO BORROW, I would borrow for a car. I don't believe in bankruptcy, but if you are concerned about those things, then you want to pay off the student loan. They can't get your house and I believe your car if you need it to get to/from work.

[goldentraders]

Get away with that dilemma... If only you can manage to walk, set aside your wants even if it's a vehicle or anything, as long as it's not necessary for you to keep. Education is more important than anything else, and by the way, you can buy those things just be patient enough for you to graduate and get a life...

[quizbiz]

school interest rates are relatively low. If you need the car to live out and make money then it is more important than paying off the debt.