Question for people who have financed new cars

1457 Views 11 Replies 11 Participants Last post by jloehlein, Feb 4, 2007

bmaca455

Discussion Starter · Feb 1, 2007

I went and test drove a new Civic Si today. After driving it I was convinced I NEEDED to have it. I filled out a loan application and the dealer buttered me up good and made me feel like I was gonna have an affordable payment of only 375 a month. Being that I am only 20 and am on a Military budget that seemed like a lot but not unreasonable considering that it is a 20k dollar car. They printed me out the paperwork and stuff and when I looked at it I noticed that the interest rate was around 11 % and that at the end of 6 years I was gonna be paying around 30k dollars for the car. I knew going into it that I would be paying a bit for interest but that to me seemed like I was getting screwed over so I told them I needed to sleep on it. Was I right in my assumption or is that really how expensive it is to finance a new vehicle? I was going to be making a 2500 dollar downpayment and I have very little credit history although what I do have is perfect.

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SETI20

· #2 · Feb 1, 2007

Paying 30K for a 20K car.
Are you seriously asking?

I don't care how nice of a car it is. I'm never going to pay a whole THIRD more of what it's worth.
Either get a cheaper loan. Get a less expensive taste, or break out the anal lube.

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zulued

· #3 · Feb 1, 2007

i have a 107 a month payment through honda financial for the next 60 months. thats like 6400 bucks its like 15% apr

but its for my 05 trx450r quad lol thats why i pay 500 bucks a month on it
oh and the purchase price on the quad was 4480

after talking to another honda dealer they told me they screwed me becuase they could of got me 9.9%

i work at a dodge dealership and from what i found is that you never only look at one place, never pay sticker price, and always make them throw in as many extras as posible.

goto another dealer tell them that you were already at the one you went to and tell them to give you the best price they can becuase if not you will go with the other guy.. walk into the dealership as if you are buying a car somewhere today and it doesnt matter were.

goto another dealer and see what apr they can get you and dont settle for anything more than 10%

scarponze

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DAP91Si

· #4 · Feb 1, 2007

Try going to the credit union on base to get a loan. Have you thought about how much insurance is going to cost? "Si" stands for super insurance, especially at your age. Please read this.

http://www.carbuyingtips.com/

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CrxCarl

· #5 · Feb 1, 2007

I won't touch a loan payment these days for more than 6.5%. There is no reason to. If I can get 5.5 on my house and 4.99 on my Mazda, I should be able to get a good rate on anything. I have really gained some interest in the Civic Si Sedan after checking it out at the auto show. Might just have to drop in at my dealer and see what they can do.
DO NOT take 11%. Horrible rate.

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mattminerDOTcom

· #6 · Feb 1, 2007

When we got the WRX used we paid 4.95 percent on it......USED!!!

Never shoot for a monthly payment

Always negotiate the lowest possible price before talking about financing.

Shop around for your loan.

On a (normal) new car you should be able to get 0-2 percent, for an in demand car like that 4-5 would be the most Id pay.

We got the WRX for about 14.5k tax and title included, financed about 10k at 4.95 percent over 60 months, financing for 36 months wouldve only knocked off a tenth. Make payments of about double the minimum. If we paid the minimum, itd be like 1300 interest, at this rate well only pay like 600 in interest.

11 is not good.

[email protected]

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andystart

· #7 · Feb 1, 2007

In my experience, it depends on the dealer, timing and your credit rating.

For example, my wife just bought a Toyota Sienna last month (yeah, now she's a soccer Mom!). I've been told Toyota never gives 0% financing deals - we lucked into one - it was still a 2006 model - a lot-clearing special.

Any dealer worth anything should have access to at least 20 credit providers and should be able to shop around for you to get the best rate. I've had sales guys (or the finance managers) at the dealership bid against their own finance companies just to get me to buy the car.

So my advice would be:

Shop for last year's model cars (generally September through December), they're always cheaper and a lot of the time, there's no real difference between this year's and last year's model.

Check your credit score. Read the websites before you do, so you know what you're seeing. These web sites also give you advice on what you can do to improve your score. Here's one website that gives some good ideas. Generally, the higher your score, the better rate you'll get.
http://www.bankrate.com/brm/news/credit-scoring/20040128a1.asp

Tell the dealer you can't buy the car if you don't get a decent rate and ask them to shop around for you.

As a previous post said, Credit Unions most often have the best rates you can get on your own.

Good luck.

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Ragnaarok

· #8 · Feb 1, 2007

A friend of mine just bought a new civic coupe (not si) and he got a great deal on it. They paid off his loan on a two-door blazer, knocked money off the civic, and threw in a couple options for free.

You just have to find the right dealer that wants to sell a car bad, and will work with you. I also recommend the idea mentioned above, go to one dealer, haggle, then switch to another dealer and make them best each other on price.

Good luck.

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bmaca455

Discussion Starter · #9 · Feb 2, 2007

Unfortunatly thats the only Honda Dealer within 70 miles of me so I just bailed on it all togeather. As Much as I wanted one of those new Si's it prob. wasn't a best, first new car for me anyways... I also test drove a mazdaspeed protege 2003 at a different dealership so I might put in an offer on it if I can't find anything bad about them(the protege that is) online.

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coz

· #10 · Feb 2, 2007

:greenbanana: :greenbanana:

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signalpuke

· #11 · Feb 2, 2007

WORD! USAA is the shizzle. I am also in the military.
Get an IRA setup man, and whatever you put in your car match that in your IRA, USAA will help you out with whatever you need.
I got an auto loan for an IS300 from USAA six months ago (20 at the time) and my interest is very low. It was not a brand new car, but USAA will approve you for what you can afford, they will not set you up with a hellacious payment, that's for sure.
A dealer is more apt to work on the price with you if he knows you are preapproved. Find the car you want, (DO NOT look for dealerships within like 50 miles of post, you will get raped by the salesman)

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jloehlein

· #12 · Feb 4, 2007

Get external financing and buy from the Fleet Department for slightly over invoice!

http://beatthecarsalesman.com/secret-fleet.html

Also, you may want to check your credit report and score (you can get a free credit report each year from all 3 bureaus or you can sign up for Bank of America PrivacyAssist and cancel within the first 30 days to not be charged money...you can see your scores this way). If there is any incorrect information on your credit report you should have it fixed, it may or may not help your score. If your credit score is below 600 you will have a hard time finding a decent auto loan, over 700 and you should be able to get a very competitive rate. If you decide not to get a car this time around, work on improving your credit (pay your bills and pay them on time) so when you go to get financing next time you will get a good rate (total intrest charges on my 60 month loan from Honda Finance are under $2,500 for a $15,500 loan on my 06 LX).

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