join a credit union with that money .. 7 or 8 thousand.. go in ..introduce yourself to the branch president.. form a relationship.
get your credit in line..

you can finance that for 5 percent

don't fall for that sub prime crap 14 percent.. no way

save your money .. wait a little while.

dont make a big big mistake.

 

I managed to get 5.5% through my credit union with 620-ish credit score and only $500.00 down. Financed almost $29,000 over 5 years.
Dealer offered 9%.
For sure you will be able to get 5% range with local Credit Union.
Best of luck!

 

Not sure what math you're using. On a 48 month $32K loan the difference between 5% and 8% (a few percentage points) over the life of the loan is $2100+.

But even if it's only $200, that's money I'm giving to someone else I'd rather keep. It can buy me 2 months of gas, or a pair of supertickets to an ALMS race, or something cool for my car, or...

I worry about the difference between 4.99 (what my CU gives me) and 5.8 (what MINI FS offered)...that's $566 over 48 months I want to keep for myself.

 

Not sure on how your math is relevant to this thread. I thought he was going to finance $19K [having put $11K or so down]. I was referring to the people talking about 1% to 3% over 48 months on a loan of that amount. I was NOT referring to people with stellar credit who can put zero down on a $32K car purchase.

And to each their own. Some people will wait in line for 18 hours to get an iPhone, others will say no way.

Most advice magazines, including Consumer Reports tell people exactly what I said in here. When it comes between two loans just a percentage or two in APR difference, one should look at each loan's terms before making a decision.

I would venture to guess that no one looks at their loan documents, except for focusing on 1) what the payments will be; and 2) what's the APR. To keep within your example, no way I am going to sign a document that saves me a few hundreds dollars if the lender crafts an aggressive document against me.

And that's my point, not to get caught up on APR and saving a few hundred dollars over 48 to 72 months. For example, on the below APR difference that would work out to saving $7 a month. To me, it's not worth $7, or even $50, a month if I have a draconian loan agreement hanging over my head. Example, a document that gives a bank or lender the right to tap your accounts should one be late on a payment. Lenders who require direct deposit on payments. Agreements that give a right to repossession if one is just a few days late on a payment.

 

It's still $1200+ difference on 3 percentage points for a $18K loan.

What terms are you talking about that make it worth paying -- say $700 -- on a $18K loan ($700 being the difference over 48 mons. between 5% and MINI FS standard current rate of 6.8%)?

But you are right, each to his own. I'll keep the $500 I saved by spending a little time shopping for a .8% better APR deal. That's 1/4 of my next ALMS race trip.

 

All these numbers are irrelevant since we don't know what his loan terms are.

Good thing is that our discussion emphasizes people need to look at the numbers and the costs vs. benefits of any loan.

Yes, there is a choice based on a member's priorities. Using your new example [$1200 instead of $500] to some $1200 is $1200. To others, that's $25 a month and not worth signing draconian loan documents.

That's the real issue, making informed choices. Your posts are excellent in bringing to the surface alternative points to consider.

 

You are right. Everyone has different priorities. What you call draconian (e.g. required direct payment, access to accounts for late payments) doesn't bother me. I haven't been late on a payment in 15 years or so, and I do auto payments for just about any recurring bill that I can't put on my AMEX (which gives me 1-3% cash back), so I like it when they make it easy to automate payments.

I'm just a cheap-*** and don't want to let go of any money I don't have to (other than charitable causes).

 

The only reason I say "draconian" is because I have had clients [law cases] who have suffered from the effects of loan terms that normally no one gives a second thought to. When things are good the clauses never come up. But when money becomes tight, then people suffer from loss of the car [repossession], collection lawsuits, or inability to move money around or juggle things [because of automatic payment deduction.]

In fact, I got my MINI at a deal because the former owner lost his job. The payments were $800 a month, which were taken out of his account each month. He had to sell the MINI fast because he was going to be on a strict budget and could not risk that $800 not being in the account or whatever. So while an automatic payment was not a big deal at the time things were good, it turned into a real problem once the MINI owner lost his job.

 

Those are good points. For a mortgage, those kinds of terms would be more concerning to me. My JCW will have $750/month payments, but if things turn sour I still have the resources to at least prevent a car payment from draining my account. I'm a partner in an IT company with growth and no debt, so I consider myself low risk for lost income, even if I'm not immune from it. But I can see how lousy terms can make a difference for many.

 

thanks for all your input! I'm an atty so I will def'ly be reading ALL the loan documents. I am picking up the car tomorrow so I will let you know how it goes. The main things I want out of a loan are ability to pay off early w/o penalty and ability to refinance.

Thanks.

 

just wanted to update everyone...I got financed through MINI financial at 6.5% for 60 months. So excited...now i have to break in my car!

 

woohoo!

 

Well now isn't that a great outcome. That's a great APR. Fine news.

 

Make sure that you are fully and properly insured. Mainly, protect against the door dingers, vandals, and auto burglars. So get your "comprehensive" deductible as low as your carrier allows. Mine is $100.

 

i like you, you're smart

 

It's called "risk based analysis," and it's pretty popular right now. As far as decent rates go, my dealer said that a minimum 740 is needed to get sub-5% financing. I got a 4.9% lock until 11/13 (hopefully my car will be here by then) and the dealer told me that if the Fed lowers interest rates here after 11/1, they will resubmit to try and get a lower rate.

but then I put 45% down, cash and R53 trade equity.

 

Good job. MFS financed my R53, and they were nothing but professional and helpful throughout the life of my loan. Could not have been happier, one of the best customer service experiences ever. Plus, there are stories of MFS granting temporary deferrments in case of unemployment or any other financial factor beyond yr control.

 

Back to the oft asked question about why dealers don't want to take credit cards for down payments....typical credit card fee charged back to a merchant is about 4%. So if the MINI dealer allowed you to put down $10K on a card, they would only get $9600. On a car with roughly $3K of markup at MSRP, they've just lost out on over 10% of their profit. Markup on parts and service is much higher (as is I'm sure the high end home entertainment products mentioned earlier) so absorbing the fees as part of doing business is much easier for the dealer to accept. I have put over the phone deposits to hold a car before on a credit card, but never for more than $1000.

 

Our dealer didn't seem to mind, or didn't say they minded. They wouldn't take more than $15k on the card for the final payment though.