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But 0%-4% isn't happening. Those are new car special rates that the auto makers buy down. Typically, used cars will be minimum 4.5%-5%.
My '5 CTS-V and my '8 Solstice GXP loans have an interest rate of 3.99% with my credit union and both were bought used. Would have been a bit lower (closer to 3.50%) if they were newer model year.
looik for manufacturers to really star giving low rates on 2011 vehicles soon. Since you have good crdit which is require to get them.wait for them.Sone are zero and other are like 0.9%.Do the math on incentives by going to a bank site and doing the interest over number of year before decidig the interest or cash.Be sure and vist sites like emonds.com to know what you solud be poaying before the incentive. Good luck and take your time;get the price first then talk financing and be willing to walk, Don't fall for the how much you can afford a month;they love that.
Thx for the advice! One thing.... I have seen on a number of posts where people say don't fall for the how much can you afford line....what exactly is this tactic ?
A tactic to either tacking on more interest rate or getting you to buy more expensive (higher class or with more options) or both.
Stick to getting the car you want (granted that it's still within your buying power) and negotiate for the lowest possible interest rate, lowest loan term (*make sure there is NO penalty for early payment*), and lowest purchase price. Don't fall for dealer add-ons, warranties, and doo dahs
Zero percent financing does not mean the lowest overall cost, often it's in lieu of a rebate. So, shop around, do your calculations, and compare them.
My '06 Mustang GT convertible was bought with a loan through my credit union at 2.99% last month. 45k miles and a non-fracnhised dealer. Simple process to apply online for the amount I wanted to spend, and then after I chose the car, got a purchase order, the credit union cut a check, and I paid the dealer. All same day stuff for me.
I would shop around from you bank and credit union as well as online loan places like Capital One to see what kinds of rates you qualify for. One catch with some of the banks is that they require that you buy the car through a franchised dealer, meaning Chevy, Ford, Toyota, Honda, etc., though you can buy any car from that dealer, not just the brand they are franchised to.
The actual interest rate will vary on a lot factors including the term, loan-to-value ratio and your overall credit profile. Assuming everything is within "normal" ranges I would expect anywhere from 4%-7% on a used car loan.
Depending on you credit you can get anything from 0% to 21%.
If your credit score is above 700 I would try to get pre approved through a bank that does car loans. It makes the whole process a lot simpler. If the dealer wants your business they'll have to beat the rate the bank gives you.
When we bought the GF's car two yrs ago we walked out of two dealers because they wouldn't come down below 5% and her credit score is 750. We kept looking and eventually found a dealer that was interested in selling cars an financed her at 0.9% for 60 months.
If dealers are screwing you around walk away. I would walk if it's anything over 5% and you have good credit.
When we bought the GF's car two yrs ago we walked out of two dealers because they wouldn't come down below 5% and her credit score is 750. We kept looking and eventually found a dealer that was interested in selling cars an financed her at 0.9% for 60 months.
If dealers are screwing you around walk away. I would walk if it's anything over 5% and you have good credit.
That's not the dealer "screwing you", that just means the bank you were using had a better rate. Dealers don't get to choose any bank they want, it's likely that none of their banks could match the rate. They wouldn't have let you walk if they could have.
And your .9% was a manufacturer-incentive rate, not anything the dealer had to do with.
I hate how everyone assumes that just because they didn't get exactly what they want, the dealer was trying to screw them over.
That's not the dealer "screwing you", that just means the bank you were using had a better rate. Dealers don't get to choose any bank they want, it's likely that none of their banks could match the rate. They wouldn't have let you walk if they could have.
And your .9% was a manufacturer-incentive rate, not anything the dealer had to do with.
I hate how everyone assumes that just because they didn't get exactly what they want, the dealer was trying to screw them over.
Wrong. Dealers take what's called points on interest. The financing bank will come back with a rate and the dealer will bump the rate to make a profit.
The three dealers we went to where all the same manufacturer and all three dealers offered us financing through subaru financial of America. If the dealers are not bumping the rate to make a profit then why where we offered three different rates from three different dealers all from the same lender ?
When we found an Semi honest dealer we purchased from them.
Dealers don't make money on the cars themselves. They make money on financing, extras and service.
Wrong. Dealers take what's called points on interest. The financing bank will come back with a rate and the dealer will bump the rate to make a profit.
The three dealers we went to where all the same manufacturer and all three dealers offered us financing through subaru financial of America. If the dealers are not bumping the rate to make a profit then why where we offered three different rates from three different dealers all from the same lender ?
When we found an Semi honest dealer we purchased from them.
Dealers don't make money on the cars themselves. They make money on financing, extras and service.
While you are absolutely correct that dealers make money off the points they tack on to the financing rate, in your situation, I find it odd that you were able to get 0.9% from ANY financial insitution. Rates that low are pretty much always a manufacturer subsidized rate, which any dealer could give you and they do NOT monkey around with. Their incentives are built into the backend by getting people to use the manufacturers credit arm.
Who is your financing through? My guess would be Subaru Financial. Chances are as you were shopping one of three things happened.
1. Either the original three dealers were giving you all applicable cash rebates which would disqualify you from getting the subsidized rate. In that case, 5% really isn't all that bad and it would be a determination between whether the cash rebates or finance subsidy was the better deal.
2. While you were in the process of shopping Subaru changed its monthly offers and introduced the subsidized financing rate. This means that the last dealer you went to could offer you a rate that didn't exist before.
3. Something happened to the details of the deal. Your GF's credit rating went up for some unknown reason, making her elligible for the rate, or the other dealer gave you more for your trade or a better price on the car you bought, that made the deal qualify for the subsidized rate.
I know dealers play "games" with a lot of things, but if they can get you the manufacturer subsidized rate, it is a slam dunk for them. They get incentives on the back end and the finance process is real easy. I've never seen a dealer play games when they could just use the manufacturer rate. The only time they might not use it, is if someone's credit is good enough and the cash incentives are large enough, that using the cash rebates and the non-subsidized financing is a better overall deal.
While you are absolutely correct that dealers make money off the points they tack on to the financing rate, in your situation, I find it odd that you were able to get 0.9% from ANY financial insitution. Rates that low are pretty much always a manufacturer subsidized rate, which any dealer could give you and they do NOT monkey around with. Their incentives are built into the backend by getting people to use the manufacturers credit arm.
Who is your financing through? My guess would be Subaru Financial. Chances are as you were shopping one of three things happened.
1. Either the original three dealers were giving you all applicable cash rebates which would disqualify you from getting the subsidized rate. In that case, 5% really isn't all that bad and it would be a determination between whether the cash rebates or finance subsidy was the better deal.
2. While you were in the process of shopping Subaru changed its monthly offers and introduced the subsidized financing rate. This means that the last dealer you went to could offer you a rate that didn't exist before.
3. Something happened to the details of the deal. Your GF's credit rating went up for some unknown reason, making her elligible for the rate, or the other dealer gave you more for your trade or a better price on the car you bought, that made the deal qualify for the subsidized rate.
I know dealers play "games" with a lot of things, but if they can get you the manufacturer subsidized rate, it is a slam dunk for them. They get incentives on the back end and the finance process is real easy. I've never seen a dealer play games when they could just use the manufacturer rate. The only time they might not use it, is if someone's credit is good enough and the cash incentives are large enough, that using the cash rebates and the non-subsidized financing is a better overall deal.
At the time the only offer on the Forester was 0.9% for 60 months. No cash back offers or other discounts of any kind. We researched the car prior to walking into the dealer. The 0.9% was the reason we decided to buy at that time. Knowing her credit score we knew she would easily qualify.
There wasn't time for her credit rating to change. We visited the first two dealers on a Thursday and the third dealer the following day. We brought the car home that Friday night. The whole process took 2 days total.
Unfortunatly I've worked in a couple of dealers in my life and I've played the game from both sides of the desk. If the dealer sees you want the car they play on your emotions and they know they can do whatever they want.
Days after we walked away from the first two dealers we were getting calls asking if we would still take the car "IF" the dealer could get the 0.9%. One sales manager went as far as calling me a liar when I told him the other dealer got us 0.9% without a problem.
Most dealers are there to screw-you over. I've been there, taken the training classes, taught the scams and sold the cars. I will tell you that there wasn't a single day that I went home or a single paycheck I collected that made me feel good about what I was doing. That''s why I refuse to play those games in my business today. You come in here you get honest service and honest work.
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