Did you recently take on (or consider) a loan of 84 months or longer on a car purchase?
A reporter would like to speak with you about your experience; please reach out to PR@Edmunds.com by 7/22 for details.
A reporter would like to speak with you about your experience; please reach out to PR@Edmunds.com by 7/22 for details.
Options
Comments
Drive it, make the payments on time and try to put as much to the principal as you can. Once you have shown that you have a good pay history re-fi it. I don't know if a few months will do it like another poster said but 12 months should.
It is to late for you but a piece of advice for those who read this who may be in the same situation.
Ask if there is a college student purchase program. Ford Credit currently has one where if you are in college and have a job you can finance with them under the program as long as you don't have chronic bad credit. It caps the tier so if you purchase a new car the worst case scenario if you take the rebate is in the 12-13% range. Not great but allot better in then 25%. In this case that is $4300 more car you could have purchased. Take that and the rebates and you are in a new Fusion or Focus. Actually on a Fusion you could get 8.9% and be riding in a well equipped, brand new car.
I am not plugging Ford, I am guessing most manufactures have some kind of program similar to this.
First time car buyers with out a co-signer some times have to take there lumps to get started, it is up to them to control how big the lump is.
Does it mean that if you pay cash you can't have the rebate? Would you think that you would have to finance 100% of the cost or could you just finance a $1000 or so to qualify? How would early payment effect the rebate?
I'm aware that most companies exclude low financing with rebates but this is the first time I've seen them bundled like this. Is it common?
I usually pay cash for my cars so I may be out of the loop on this one.
2019 Kia Soul+, 2015 Mustang GT, 2013 Ford F-150, 2000 Chrysler Sebring convertible
The salesman was saying that since I have never financed a car before, I would have to "prove" myself to the bank.
That is exactly what it means Old Farmer
Would you think that you would have to finance 100% of the cost or could you just finance a $1000 or so to qualify? How would early payment effect the rebate?
With Ford there is no minimum to finance. Cash buyers who just want the rebate usually finance like $5K or something.
Ford is a simple interest lender with no penalty for early pay off so you can do what you like with the loan. I usually suggest though waiting till the second payment so you can be sure Ford has received the title prior to you sending your check to pay it off.
Depreciation
+ Finance charges
+ Tax
/ Term
= Lease Payment
Edmunds Price Checker
Edmunds Lease Calculator
Did you get a good deal? Be sure to come back and share!
Edmunds Moderator
So, if you financed your last vehicle purchase, how long did you finance it for? Or if you sell cars, what length of time do you find most people finance for?
Usually I pay cash. This was the first car I've carried any financing on since 1984.
What is the best thing to do at this point? Just pay the loan off as quickly as we can? I am kicking myself over this because I knew this was a bad move but was a first-time buyer and trusted my fiance's judgment.
It's not clear exactly what you overpaid on - the car itself or the add-ons like extended warranty and so forth?
If you or your fiance is a member of a credit union, you could probably get better financing terms there. If not, chalk it up to experience, pay it off as soon as possible, and move on to worrying about other things like your wedding!
Speaking from personal experience - the months before the wedding can be so nerve-wracking that really minor stuff can blow up and appear major. Since you say the payment is within your means, sounds like you haven't done anything all THAT horrendous. Let it go and move on with your life.
Why don't you tell us the details, perhaps on Real-World Trade-In Values, and let the pros tell you how you did.
I doubt it's as bad as you think.
And since you blame your fiance for it, learning this might be good for the relationship, if ya know what I mean...
A lot of people get most of their exercise jumping to conclusions...
-Mathias
We are talking a one price brand and a low interest rate from Toyota Financial.
We overpaid for add-ons (like Lo-Jack, etc.) because the way they worked with the payments it SEEMED like a better deal at the time because we financed through Toyota and my credit was shaky. I hadn't been planning on replacing my car until September because I had credit issues that I've taken steps to fix for the past year or so (got completely out of credit card debt, etc.) and I was saving for a downpayment.
They bumped me up a credit tier with my fiance as a co-signer and lowered the interest rate so when we saw the payment I thought "oh, ok that's manageable" but I didn't even THINK about how much TOTAL we were financing. I should have just done financing through Capital One at a higher rate because then I would have financed thousands of dollars LESS and I would have had the option to refinance anyway eventually.
Our initial payments are lower now than if I used Capital One but now I'm stuck with all these stupid add-ons and refinancing isn't going to save me much money at ALL.
Essentially, the difference numerically is financing $20,000 (with TT&L) at 11% through CapitalOne, or financing $25,000 (TT&L and add-ons) through Toyota at 6%.
I love the car but dammit. We could have bought a $25,000 car instead of an $18,000 car for the same money. And I didn't even WANT a $25k car.
'11 GMC Sierra 1500; '98 Alfa 156 2.0TS; '08 Maser QP; '67 Coronet R/T; '13 Fiat 500c; '20 S90 T6; '22 MB Sprinter 2500 4x4 diesel; '97 Suzuki R Wagon; '96 Opel Astra; '11 Mini Cooper S
If the numbers you gave are correct then the payments can't be lower.
$20K @ 11%=$431 X 60
$25K @ 6%= $483 X 60
You must be confused on your numbers
'11 GMC Sierra 1500; '98 Alfa 156 2.0TS; '08 Maser QP; '67 Coronet R/T; '13 Fiat 500c; '20 S90 T6; '22 MB Sprinter 2500 4x4 diesel; '97 Suzuki R Wagon; '96 Opel Astra; '11 Mini Cooper S
BTW was the Lojack pre-installed or do they still have to install it. If it was pre-installed then you knew you were getting it right?
This is why I like working in a menu based full disclosure store. I NEVER get phone calls/complaints about aftermarket products being sold the customer did not want.
My mistake was looking at the payment instead of the total cost. BAD move. Now I know better. I just wondered if there was anything I can do post-bad decision-making besides pay it off very quickly and count my blessings that we didn't get ourselves into something that would drive us broke.
You wrote you got a 6% rate - this is good these days, especially for less-than-perfect credit. And the money is spent, refinancing will not reduce the amount owed, and with the existing low 6% rate, is unlikely to reduce the payments.
I really don't see why you want to pay it off quickly - unless you have a significant amount of cash parked in a money market earning 3% or so.
From what I understand, you got a reliable, durable and frugal vehicle. You also paid extra for some add-ons and services that you may or may not use - some of these can perhaps be cancelled for a refund. If you keep this for several years, this extra money is unlikely to make a big difference.
OTOH, if you decide you MUST trade it in today or a year from now, you may have a hard time getting most of this "extra" money back. Since you are posting here asking for guidance, you are too smart to trade in a one-year-old car
...still, though. Bad move. LOL.
Chalk it up as one of those things you've learned from. Next contract you sign - like for a house! - I bet you'll be very, very careful.
Good luck with getting out of some of those add-ons, hope you can do that.
An expert is just someone who has made every possible mistake.
2019 Kia Soul+, 2015 Mustang GT, 2013 Ford F-150, 2000 Chrysler Sebring convertible
I just have a quick question, I hope it's not a dumb one. Can you refinance more than once?
No- once would be a refinance, the second time would be a rerefinance, third time would be a rererefinance, etc...
Yes, you can refianance more than once
Now if I was to really fix my credit and try again in a few months or even a year... that could be more worthwhile...
Now if I was to really fix my credit and try again in a few months or even a year... that could be more worthwhile...
Yes it could and you're to be commended for thinking this way. However, it will only work for you (or anyone) to re-finance the remaining balance (or lower) AND do NOT extend the payment term. If your payoff balance is $6,000 and have 24 months remaining on the loan, then don't re-finance more than $6K or a loan longer than 24 months.
Here's an example that shows $198 savings or $136 additonal expense:
$6K at 10% for 24 months = $277 month and $645 interest paid.
$6K at 7% for 24 months = $267 month and $447 interest paid.
$7K at 7% for 36 months = $216 month and $781 interest paid.
The expense/savings difference can better if the current APR/loan balance is higher or if the new APR is lower or a shorter term.
If your payment is something like $267, have $300 automatically taken out of your checking account and paid toward the loan each month. You'll never miss the extra money and you'll save on interest and get that thing off your back.
Thanks
Can i pay the whole money for new car from my account and later apply for the loan. Do the banks give loans to person?? :confuse:
'11 GMC Sierra 1500; '98 Alfa 156 2.0TS; '08 Maser QP; '67 Coronet R/T; '13 Fiat 500c; '20 S90 T6; '22 MB Sprinter 2500 4x4 diesel; '97 Suzuki R Wagon; '96 Opel Astra; '11 Mini Cooper S
She was asking me, with her monthly gross being $2900, her mortgage being $1050, would she be able to get financed for an additional $350 / month note without a co-signer? I told her I thought she would, since her score was so high.
She typically buys a new car (for the warranty), and drives it until it dies, so this is a vehicle she would more than likely own for 10-15 years. Plus, she tells me the way her budget is worked out, she would be making extra payments as well.
What say the experts? - Does she get financed without needing a co-signer?
If she is doing $18K plus the tax she would need to find a new car with a 2.9% apr on it to get to $350 a month. That is based on TN taxes, they may be more or less then where she lives.
If the $18K is an OTD price then she would need a rate of 6.23% to get a $350 payment.