Car Financing question...

What I've done today is print out anything I'm interested in at all the local dealerships, so I can see them in front of me and be able to say "hey, these guys are offering the same year, comparable mileage, for $2000 less".  They all have their own financing options but I'm leery of applying more than once so I'll wait to hear back from the credit union.  I know each hit goes on the report.

Tonight we're going to the place the credit union owns.  They have the one I want the most but it's also the most expensive.

While it is true that the more requests for your credit reports reduces your score, it is not the case when you are shopping around for something like a car or a house.  If you have 5 requests from various car dealerships within a few weeks of each other, the credit bureaus count those as 1 request.  They understand people will shop around for the best rates/deals, and will not punish you for doing your research.  Since they would all be for auto loans, they lump them together.

Ah, OK so I can go ahead and request financing offers from the other dealers?  It did sound kind of dumb to punish me for inquiring about my own credit, lol.

Plus, the next big thing will likely be a mortgage, which we will likely do through the same credit union anyway.

Liesje

Ah, OK so I can go ahead and request financing offers from the other dealers?  It did sound kind of dumb to punish me for inquiring about my own credit, lol.

Yeah, and they know that, that's why if all the requests are for the same thing within the same time period, they don't punish you.

Liesje

Plus, the next big thing will likely be a mortgage, which we will likely do through the same credit union anyway.

Hey, maybe you can use that as leverage on their offer for the car loan!

 We are members of a credit union, and when we bought our car last year, we went in before hand and got pre-approved for the loan at the amount that we could spend. Then we went car shopping. It was hilarious to see the car salesman's face when we said we didn't need to talk financing - already had it. Put us in a good position to shop without their hounding. All we had to get was a letter from the CU (can't remember what it is called, have to ask hubby this evening) to show that we were pre-approved for the loan. Think it is called a letter of credit. I'll get back to you on that.

I'm surprised at the 20% down - that was never mentioned to us. But then again, we had some money saved and knew that we weren't going to need the full 10k that the loan was for but they didn't know that. We had them figure the monthly payments with the interest figured in at 3 different amounts in case we got a car cheaper than what we figured. Worked out great. We bought a second hand vehicle, and the car is the collateral for the loan.

The shopping - not so much. We went all over looking after spending time on line looking through the different car listing places. I would say, if you haven't already, spend the $30 for a months worth of Car Fax - beyond helpful. They also have cars listed through car fax for your area which is also very  helpful. Also try autotrader.com, and look at the websites for your local papers. We found several through those avenues to look at. And Enterprise's website has list of cars that they have up for sale as well.

After all was said and done, the Vibe that we were looking for just wasn't happening. So I spent time pouring through carfax and autotrader looking at cars that were just out of our price range. We found a 2006 Ford Escape that had just been marked down to our price range. Before hand, the small SUV's had been out of our reach, but this one had been on the lot for almost 90 days and was going to be sent to auction. They wanted to sell it instead, so they marked it down almost $3000 and we got it. We had been missing all the deals until that day.

I know you are in a bind and need a car, but if you can, slow down, take a breath, and spend some time looking. The one for you will fall into your lap. It happened for us, and I believe it will happen to you. Good luck!

PS And yes, I took my crates too. I spent more time looking at cargo space then the front part of the car! Was too funny!!!!

Amy

stardancnminpin

We are members of a credit union, and when we bought our car last year, we went in before hand and got pre-approved for the loan at the amount that we could spend. Then we went car shopping. It was hilarious to see the car salesman's face when we said we didn't need to talk financing - already had it.

I've heard this is the way to go.  The interest rates are usually sooo much lower with a credit union, even if you buy the car elsewhere.

Also, and Liesje, I think you already know this, but for anyone else interested in buying a used car, always, always, always, get it checked out by a mechanic before buying.  Even if it's listed as "certified pre-owned."

On a side note, I wrote a check today for my last car payment!!  Five years and it's finally all mine.  (((happy dance!)))

About the Carfax...the dealers I've been looking at, on their sites I can click on the Carfax link and it will say something like "7 records" for the vehicle, I click on that, and it gives a history of when it was bought, sold, serviced, etc.  So do I still need to pay for something beyond that?

stardancnminpin

We are members of a credit union, and when we bought our car last year, we went in before hand and got pre-approved for the loan at the amount that we could spend. Then we went car shopping. It was hilarious to see the car salesman's face when we said we didn't need to talk financing - already had it.

LOL, thats what the saleman that sold me my truck was like!

aerial1313

On a side note, I wrote a check today for my last car payment!!  Five years and it's finally all mine.  (((happy dance!)))

Congratulations!!!  Now we'll all keep our fingers and paws crossed that it holds up long enough for you to enjoy a few *payment free* years of driving.

Joyce

Liesje

About the Carfax...the dealers I've been looking at, on their sites I can click on the Carfax link and it will say something like "7 records" for the vehicle, I click on that, and it gives a history of when it was bought, sold, serviced, etc.  So do I still need to pay for something beyond that?

Nope, a lot of dealers nowadays will provide that for free since they need to move the cars.  If you can get them for free on the site, great, if you can't ask them to provide it to you.  They should for free.

Also, I can't agree more to obtain financing before you shop if you can.  That way you have bargaining power.  They know you can get a car from anywhere so they are more willing to haggle.  They need to move these vehicles...NOW! 

Also, what is your price range?  What kind of car are you looking for?  The secret is, check to see how many days the vehicle has been on the lot.  My dad just got a car (new though) and because it was there since the end of 2008 it was dramatically lower.  If you are looking for a GM, let me know, I can see what I can find in terms of "deals" that are available.  You can sometimes tell a used guy, hey I can spend an extra XX and get a new one and they might come down some more on price.  Don't worry about hurting their feelings, this is their job.

 I was able to get preapproved through my CU online...didn't even need any proof for the dealer (they did call, though).  Never even went to the CU!  The dealer couldn't even come close with their financing. 

Lisa I'm looking for a used minivan, probably 2002-2005.  Want to keep it under 75K miles, definitely under 100K, and the price under $10K.  The highest price one we are looking at is $10,500 with a $500 instant discount, before any haggling (going out there tonight).  I've got several printed out that are in the $7000-$8000 range. 

I don't know the trade-in value of our current car, maybe $500-$1000, but I'm not going to ask until we're pretty much sold on what we want.  I know all of the places we are looking do take trade-ins.

The credit union hasn't called back with their new loan offer so I might call them.  I want to know what they will offer before we go out there tonight...

We will probably go to the other lots this weekend.

OK, I just called and she said it went through.  They still want 20% down for $10,500 or less @ 6.5% (for a 2004...I guess the year matters so I just said 2004 since that's most of the vehicles we're looking at) for 60 months or less.  Does that sound fair?  Or do I just take that offer and then see if the dealerships can get under it?

I put it in some loan calculator online and it = $195/mo payments (for the max loan amount and I really want to get more like $7500)

mrstjohnson

You can sometimes tell a used guy, hey I can spend an extra XX and get a new one and they might come down some more on price.

That's exactly what I did.  When he tried to call my bluff and called "his friend" at another dealership, said "friend" didn't know who the heck he was, but still confirmed my assertion.  I ended up getting my car for $2300 under book value, and almost $4000 less than their sticker price.... partly because they hadn't sold anything on that President's Day Weekend.  (I wasn't out there looking for deals just because of that weekend, because I knew they screw around with promotions, so I was happy to walk away at any point.)  Luckily, I've had my car for 9 years now and it's hauled me across country a number of times now.  Next year, tho, I think it gets to retire, provided I have good income. lol :)

Liesje

Or do I just take that offer and then see if the dealerships can get under it?

You shouldn't have to agree to anything with the credit union until you've selected a car, so keep your options open. You're now able to go shopping knowing the terms of the credit union and if the dealership has a better deal, go with them. When I bought my car almost 2 yrs ago, I'd gotten pre-approved by my credit union but the dealership had an even better rate. I had to wait a few days for the car to be shipped in and in that time the credit union called and offered me a better rate (from 6.99 to 4.99), so I went with them.