Standard Rate APR

raymos24

Hi Everyone! I normally look for your guidance on lease numbers but I have a new type of question today. Instead of leasing, we are looking to purchase a 2018 Hyundai Elantra because we plan on keeping it for some time. Right now Hyundai is offering about 3000 dollars in cash back if you choose standard rates or only 1000 back if you choose their promotion rates. Has anyone ever dealt with Hyundai standard rates? We would qualify for tier 1 credit and have a Hyundai Lease will be returning that is maturing. Credit Unions are around 3% here in Boston but I'm not sure if Hyundai will try to sell us a much higher "standard rate". Does anyone have insight into what the standard rate might be for Hyundai? Thank you!

kyfdx

raymos24 said:

Hi Everyone! I normally look for your guidance on lease numbers but I have a new type of question today. Instead of leasing, we are looking to purchase a 2018 Hyundai Elantra because we plan on keeping it for some time. Right now Hyundai is offering about 3000 dollars in cash back if you choose standard rates or only 1000 back if you choose their promotion rates. Has anyone ever dealt with Hyundai standard rates? We would qualify for tier 1 credit and have a Hyundai Lease will be returning that is maturing. Credit Unions are around 3% here in Boston but I'm not sure if Hyundai will try to sell us a much higher "standard rate". Does anyone have insight into what the standard rate might be for Hyundai? Thank you!

Unfortunately, we don't have the Standard rates for Hyundai.

But, the promotional rate is 0% for up to 72 months (w/$1000 bonus) If Hyundai's rate is 4.9%-5.9% with $3000, then the 0% w/$1000 is still better.

Let's assume that the amount financed is $20000, before applying the financing bonus
The choices rank this way. (assuming 5.9% for Hyundai standard rate

1) 0%/72 mo. $1000 bonus (so, $19K financed) $263.89/mo.
2) 5.9%/72 mo. $3000 bonus ($17K financed) $280.94/mo.
3) 3.0%/72 mo. $0 bonus ($20K financed) $303.87/mo.

All that assumes that the standard rate is 5.9%.. But, 0% financing is the superior option, assuming the loan is taken to term.

raymos24

kyfdx said:

raymos24 said:

Hi Everyone! I normally look for your guidance on lease numbers but I have a new type of question today. Instead of leasing, we are looking to purchase a 2018 Hyundai Elantra because we plan on keeping it for some time. Right now Hyundai is offering about 3000 dollars in cash back if you choose standard rates or only 1000 back if you choose their promotion rates. Has anyone ever dealt with Hyundai standard rates? We would qualify for tier 1 credit and have a Hyundai Lease will be returning that is maturing. Credit Unions are around 3% here in Boston but I'm not sure if Hyundai will try to sell us a much higher "standard rate". Does anyone have insight into what the standard rate might be for Hyundai? Thank you!

Unfortunately, we don't have the Standard rates for Hyundai.

But, the promotional rate is 0% for up to 72 months (w/$1000 bonus) If Hyundai's rate is 4.9%-5.9% with $3000, then the 0% w/$1000 is still better.

Let's assume that the amount financed is $20000, before applying the financing bonus
The choices rank this way. (assuming 5.9% for Hyundai standard rate

1) 0%/72 mo. $1000 bonus (so, $19K financed) $263.89/mo.
2) 5.9%/72 mo. $3000 bonus ($17K financed) $280.94/mo.
3) 3.0%/72 mo. $0 bonus ($20K financed) $303.87/mo.

All that assumes that the standard rate is 5.9%.. But, 0% financing is the superior option, assuming the loan is taken to term.

Thank you for the detailed explanation! I actually did the numbers as well and the 0% financing was superior. Of course, the dealer wants you to take the standard apr and then refinance after 3 payments. My guess, they most likely make some back end on the standard rate deals.