howto request : buying a new car
the one and only
Joined: Dec 2000
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From: Govenator Territory
goto www.carsdirect.com
find the exact car you want
do not pay over that price
if you pay under then consider it a good deal :thinking:
find the exact car you want
do not pay over that price
if you pay under then consider it a good deal :thinking:
Thread Starter
BOOM goes the dynamite!
Joined: Mar 2003
Posts: 27,571
Likes: 1
From: in a van down by the rive
so what about financing and stuff? i figured i'd probably want to go through my credit union (orange county teachers federal credit union). but is it going to matter much? :dunno:
Stuff and things.
Joined: Dec 2003
Posts: 1,972
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From: New York
flipped cracka,
It might matter. Sometimes the manufacturer will do whats called "subventing" the interest rate. When you see advertisements for 0.0% financing, it isn't because anybody is lending money for free -- its because somebody is buying down the loan.
The upshot is that you should ask the dealer what is the best interest rate they can offer and compare it to the credit union. Pick whichever one you like the best, but bear in mind that if the difference is half a percentage point, you're probably only talking about a difference of less than a few hundred dollars over N years.
Financing at the dealership could be more convenient by far even if it costs a little more.
Good luck.
It might matter. Sometimes the manufacturer will do whats called "subventing" the interest rate. When you see advertisements for 0.0% financing, it isn't because anybody is lending money for free -- its because somebody is buying down the loan.
The upshot is that you should ask the dealer what is the best interest rate they can offer and compare it to the credit union. Pick whichever one you like the best, but bear in mind that if the difference is half a percentage point, you're probably only talking about a difference of less than a few hundred dollars over N years.
Financing at the dealership could be more convenient by far even if it costs a little more.
Good luck.
Senior Member
Joined: Jan 2001
Posts: 13,540
Likes: 0
Originally Posted by benjamin
flipped cracka,
It might matter. Sometimes the manufacturer will do whats called "subventing" the interest rate. When you see advertisements for 0.0% financing, it isn't because anybody is lending money for free -- its because somebody is buying down the loan.
The upshot is that you should ask the dealer what is the best interest rate they can offer and compare it to the credit union. Pick whichever one you like the best, but bear in mind that if the difference is half a percentage point, you're probably only talking about a difference of less than a few hundred dollars over N years.
Financing at the dealership could be more convenient by far even if it costs a little more.
Good luck.
It might matter. Sometimes the manufacturer will do whats called "subventing" the interest rate. When you see advertisements for 0.0% financing, it isn't because anybody is lending money for free -- its because somebody is buying down the loan.
The upshot is that you should ask the dealer what is the best interest rate they can offer and compare it to the credit union. Pick whichever one you like the best, but bear in mind that if the difference is half a percentage point, you're probably only talking about a difference of less than a few hundred dollars over N years.
Financing at the dealership could be more convenient by far even if it costs a little more.
Good luck.
Stuff and things.
Joined: Dec 2003
Posts: 1,972
Likes: 0
From: New York
There's no such thing as free money.
"about the 0%.... domestics are all curretly offeriing this incentive.. and yes, its FREE credit... thats what happens when you u sell piieces of shit that no one buys..."
When a customer finances a loan through a dealership, what's really happening is that the dealership is reselling, for a profit, a loan offered by a bank.
Lets say Chase Manhattan Bank USA is a lender that your local Honda dealer works with. You fill out a credit application and the dealer submits it to Chase Manhattan Bank. Chase runs your credit report and decides whether or not to take a risk lending you money, and how much of a risk to take. If you have bad credit, its more likely that you won't finish paying off the loan, so they charge you more interest in order to get a return on the investment.
A good interest rate for someone with middle-of-the-road credit would be about 8.9% in a scenario like this. If you have excellent credit, maybe you get offered 5.9% or better. The rate is also dependent upon several factors including the interest rate set by the federal reserve.
If you sign a financing agreement at 8.9%, chances are that the dealership marked up the loan by 3 points, and the cost of the loan is actually 5.9%. In New York, its illegal to charge more than 3 points of markup. There are more complicated ways to get financing, but lets stick with this for now.
When you see 0% financing advertised, check the fine print -- it says "for qualified buyers." Usually that means a Transunion credit score of 810 or better, which is excellent credit. The way it works is that instead of the buyer paying the interest on the loan, the auto manufacturer pays it. Ford et al. use a 0% loan as an incentive to get people to buy a Focus or whatever.
Therefore, there is no such thing as free money. Somebody is paying interest, always.
When a customer finances a loan through a dealership, what's really happening is that the dealership is reselling, for a profit, a loan offered by a bank.
Lets say Chase Manhattan Bank USA is a lender that your local Honda dealer works with. You fill out a credit application and the dealer submits it to Chase Manhattan Bank. Chase runs your credit report and decides whether or not to take a risk lending you money, and how much of a risk to take. If you have bad credit, its more likely that you won't finish paying off the loan, so they charge you more interest in order to get a return on the investment.
A good interest rate for someone with middle-of-the-road credit would be about 8.9% in a scenario like this. If you have excellent credit, maybe you get offered 5.9% or better. The rate is also dependent upon several factors including the interest rate set by the federal reserve.
If you sign a financing agreement at 8.9%, chances are that the dealership marked up the loan by 3 points, and the cost of the loan is actually 5.9%. In New York, its illegal to charge more than 3 points of markup. There are more complicated ways to get financing, but lets stick with this for now.
When you see 0% financing advertised, check the fine print -- it says "for qualified buyers." Usually that means a Transunion credit score of 810 or better, which is excellent credit. The way it works is that instead of the buyer paying the interest on the loan, the auto manufacturer pays it. Ford et al. use a 0% loan as an incentive to get people to buy a Focus or whatever.
Therefore, there is no such thing as free money. Somebody is paying interest, always.
Stuff and things.
Joined: Dec 2003
Posts: 1,972
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From: New York
It depends.
If you're interested but there's absolutely no way you could afford the car even if they sold it at invoice, they aren't going to budge on the price because the sale simply isn't going to happen.
If you're interested and they think you're just playing around with them and are likely to buy at another dealership, they aren't going to do anything for you. Somebody is going to buy the car you're interested in, and they'll sell it to whoever puts the cash on the barrel. Thats their job.
The best way to approach a salesman is as an informed buyer. Be friendly with the salesman, not adversarial. He'd much rather sell a car to an easy customer who he likes talking to. Its a good idea to be specific and clear about what you want.
There are lots of great salesmen in the car business, but there are also some pretty scummy people. Always remember that when you buy a car you're putting cash into the salesman's pocket. If you're not happy dealing with one particular salesman, and you're being reasonable, it is okay to ask to talk to another salesman. You don't have to buy him dinner if he's being a jerk.
If you're interested but there's absolutely no way you could afford the car even if they sold it at invoice, they aren't going to budge on the price because the sale simply isn't going to happen.
If you're interested and they think you're just playing around with them and are likely to buy at another dealership, they aren't going to do anything for you. Somebody is going to buy the car you're interested in, and they'll sell it to whoever puts the cash on the barrel. Thats their job.
The best way to approach a salesman is as an informed buyer. Be friendly with the salesman, not adversarial. He'd much rather sell a car to an easy customer who he likes talking to. Its a good idea to be specific and clear about what you want.
There are lots of great salesmen in the car business, but there are also some pretty scummy people. Always remember that when you buy a car you're putting cash into the salesman's pocket. If you're not happy dealing with one particular salesman, and you're being reasonable, it is okay to ask to talk to another salesman. You don't have to buy him dinner if he's being a jerk.
Senior Member
Joined: Jan 2001
Posts: 13,540
Likes: 0
Originally Posted by benjamin
"about the 0%.... domestics are all curretly offeriing this incentive.. and yes, its FREE credit... thats what happens when you u sell piieces of shit that no one buys..."
When a customer finances a loan through a dealership, what's really happening is that the dealership is reselling, for a profit, a loan offered by a bank.
Lets say Chase Manhattan Bank USA is a lender that your local Honda dealer works with. You fill out a credit application and the dealer submits it to Chase Manhattan Bank. Chase runs your credit report and decides whether or not to take a risk lending you money, and how much of a risk to take. If you have bad credit, its more likely that you won't finish paying off the loan, so they charge you more interest in order to get a return on the investment.
A good interest rate for someone with middle-of-the-road credit would be about 8.9% in a scenario like this. If you have excellent credit, maybe you get offered 5.9% or better. The rate is also dependent upon several factors including the interest rate set by the federal reserve.
If you sign a financing agreement at 8.9%, chances are that the dealership marked up the loan by 3 points, and the cost of the loan is actually 5.9%. In New York, its illegal to charge more than 3 points of markup. There are more complicated ways to get financing, but lets stick with this for now.
When you see 0% financing advertised, check the fine print -- it says "for qualified buyers." Usually that means a Transunion credit score of 810 or better, which is excellent credit. The way it works is that instead of the buyer paying the interest on the loan, the auto manufacturer pays it. Ford et al. use a 0% loan as an incentive to get people to buy a Focus or whatever.
Therefore, there is no such thing as free money. Somebody is paying interest, always.
When a customer finances a loan through a dealership, what's really happening is that the dealership is reselling, for a profit, a loan offered by a bank.
Lets say Chase Manhattan Bank USA is a lender that your local Honda dealer works with. You fill out a credit application and the dealer submits it to Chase Manhattan Bank. Chase runs your credit report and decides whether or not to take a risk lending you money, and how much of a risk to take. If you have bad credit, its more likely that you won't finish paying off the loan, so they charge you more interest in order to get a return on the investment.
A good interest rate for someone with middle-of-the-road credit would be about 8.9% in a scenario like this. If you have excellent credit, maybe you get offered 5.9% or better. The rate is also dependent upon several factors including the interest rate set by the federal reserve.
If you sign a financing agreement at 8.9%, chances are that the dealership marked up the loan by 3 points, and the cost of the loan is actually 5.9%. In New York, its illegal to charge more than 3 points of markup. There are more complicated ways to get financing, but lets stick with this for now.
When you see 0% financing advertised, check the fine print -- it says "for qualified buyers." Usually that means a Transunion credit score of 810 or better, which is excellent credit. The way it works is that instead of the buyer paying the interest on the loan, the auto manufacturer pays it. Ford et al. use a 0% loan as an incentive to get people to buy a Focus or whatever.
Therefore, there is no such thing as free money. Somebody is paying interest, always.
also ALWAYS setup your own financing.. a dealership is allowed so many pts from credit unions they work with... they'll tell u 4.9 but .4 of it is [dealer] profit... goto the same credit union on your own and youll find 4.5 for yourself...
530i
Joined: Jan 2003
Posts: 1,418
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If its a new car, find out the dealer net..you will own them
My dads 530i would have cost 70grand Canadian, but we got it for 62 because we knew the dealer net(list was 64).
Of course, its leased, so the cost is waaay less than that.
My dads 530i would have cost 70grand Canadian, but we got it for 62 because we knew the dealer net(list was 64).
Of course, its leased, so the cost is waaay less than that.
Stuff and things.
Joined: Dec 2003
Posts: 1,972
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From: New York
"i sold new chryslers and jeeps.. we had 0% incentive rates on most models... required score?? the lowest i saw that qualifed was a 620... they were given free credit, no fine print... your thinking dealer rates, not factory rates"
I sold Mini Coopers at a BMW dealership. I have no idea what you're talking about when you say "dealer rates, not factory rates." A dealership is not a lending institution.
A credit score of 620 is typical of a person who has declared bankruptcy in the last few years. When I sold cars we used to have a name for these people: credit criminals. How many cars did you sell that were later repossessed?
"also ALWAYS setup your own financing.. a dealership is allowed so many pts from credit unions they work with... they'll tell u 4.9 but .4 of it is [dealer] profit... goto the same credit union on your own and youll find 4.5 for yourself..."
Four-tenths of a percent may save you a hundred bucks over the life of the loan. If you get a rate from your credit union, tell the Business Manager* at the dealership. They might match the rate or lower the price of the car to meet the difference.
*Business Manager is the now what the F&I guy is called at a car dealership.
I sold Mini Coopers at a BMW dealership. I have no idea what you're talking about when you say "dealer rates, not factory rates." A dealership is not a lending institution.
A credit score of 620 is typical of a person who has declared bankruptcy in the last few years. When I sold cars we used to have a name for these people: credit criminals. How many cars did you sell that were later repossessed?
"also ALWAYS setup your own financing.. a dealership is allowed so many pts from credit unions they work with... they'll tell u 4.9 but .4 of it is [dealer] profit... goto the same credit union on your own and youll find 4.5 for yourself..."
Four-tenths of a percent may save you a hundred bucks over the life of the loan. If you get a rate from your credit union, tell the Business Manager* at the dealership. They might match the rate or lower the price of the car to meet the difference.
*Business Manager is the now what the F&I guy is called at a car dealership.