Credit Rating - Prius Interest Rate

<div class='quotetop'>QUOTE(SherlockBrady @ Jul 6 2007, 06:55 PM) [snapback]474325[/snapback]</div>

I recommend you forget about financing from the dealer (or at least that dealer). Go online and check Capital One or ELoan, they have very competitive rates, and if you're approved, they just send you a blank check to take to dealership. As a Costco Executive Member I got a special rate through Capital One of 5.44% for 36 mths. Good luck. Also you might want to check out Consumer Reports, car buying info. They have lots of helpful information for a new buyer so you don't get taken.

 

You should also check with your bank or credit union, for pre-approval on a car loan through them first... My dealership offered 8.9% and said they could maybe knock it down, but my credit union offered 5% upfront.

 

<div class='quotetop'>QUOTE(SherlockBrady @ Jul 6 2007, 04:55 PM) [snapback]474325[/snapback]</div>

Most if not all dealers will try to trick you into paying more if they can. That's how most of them operate.

Don't buy based on monthly payment, try to get the best price for the car. Go to a credit union (or other loan co) first, get prequalified and know up front what interest rate and purchase price you qualify for. Then negotiate the best price you can on the car. When you have agreed to the price, then you can discuss interest rate. If they offer you a better rate than the credit union, then you can finance thru them. If not, then go with the credit union.

When I bought in Feb, Toyota was offering incentive interest rates; I got a 4.9 APR for 60 mos. My credit union rate was 6.75 for 60 mos, so I financed thru Toyota. Your credit rating should be high enough to get a good finance rate.

You may need to put some money down to get the payment in the range you want; I paid $26.5 k plus tax and license, I put down $4K and my payment on 4.9 APR, 60 mos is $468/ mo.

 

<div class='quotetop'>QUOTE(dogfriend @ Jul 6 2007, 05:18 PM) [snapback]474339[/snapback]</div>

Dealers will do that...I specifically told one dealer in So Cal that I wanted to buy a Prius at invoice...and he agreed. I got pre-approved and figured out all the amortization using my hp 12c and new exactly what to expect to pay when I went into the dealership. I did not bring a check with me from the credit union that pre approved me...when I went in...all of a sudden invoice had all sorts of additional bogus charges. I then decided to see what the dealer would do in terms of financing after I got them down close to invoice...he said he would need to run my credit...I went to the dealer prepared and showed him my credit report which clearly showed 745. He came back with 7.99 for 60 mos. I got up and he asked where I was going...I told him he lost my business.

I then managed to work a deal with another dealer over the phone...no BS...I went into the dealership and the car was ready as well as the papers for a package 6 prius...the only snafu...there was a touring package and I asked if they could work a deal on that model...they did and everything was seemless.

Bottom line...use an amortization calculator beforehand., now your credit score, be prepared to walk...work your deal over the phonce or via the internet with the internet sales manager/fleet manager. There is no need to haggle once you get to the dealer.

 

Here is another question.

When we bought our Prius, the dealer insisted we had to pay the same day (Sunday, I believe). I know we were really stupid, but he really talked us into the car, how it was better than the Civic Hybrid, how they
had $2500 cashback & we could still get a little rebate... I really wanted to get another color, but he said we could not get the good deal then. But... we couldn't wait 1 day to get a loan from our local bank. In any event,
we were told we "had" to get a loan with them through a local bank, but could pay it off as soon as we wanted, without penalty or any type of fee. That appears to be true.

My other question is, the dealer finance person then said we could convert the loan to a type of loan that goes off our home and save us taxes. It was not a home equity loan. I cannot remember the name of it! Something really strange I could not even find on a Google search. We were suspicious, and I threw away the papers.
I remember it had in big letters "Ask your financial adviser if you can use as a tax deduction." If I want to put something against our house (not preferred, although old fashioned), I would get a HE loan or line of credit.
Just asking in case someone else gets this line from the dealer... is it legit?

 

<div class='quotetop'>QUOTE(SherlockBrady @ Jul 6 2007, 06:25 PM) [snapback]474376[/snapback]</div>

Since you are not in a hurry, you may want to try and wait for Toyota to have financing specials on the Prius. The last specials were back in March, so hopefully some will be coming soon. In march they had 0% for two years, and 2.9% for 3 years.

 

<div class='quotetop'>QUOTE(toade @ Jul 6 2007, 06:48 PM) [snapback]474388[/snapback]</div>

Actually, about a month after I bought my car, they offered 2.9% for 60 mos. Doh! :angry:

 

<div class='quotetop'>QUOTE(toade @ Jul 6 2007, 08:48 PM) [snapback]474388[/snapback]</div>

WE bought our 07 Prius in February. Used the 0% for 24 months with no money down on a discounted price. Couldn't have been easier or better. Payments are by automatic draft. It was a no-brainer. Love the car.

 

<div class='quotetop'>QUOTE(SherlockBrady @ Jul 6 2007, 06:25 PM) [snapback]474376[/snapback]</div>

Yes, it probably does count as 2 inquiries, but that shouldn't kill your credit score unless you are making inquiries all over the place.

Don't give them permission to run your credit unless they offer a rate better than the bank/credit union. They should be able to tell you what their best rate is before they run your credit. Same thing applies to the bank/credit union. They should be able to tell you what the rate is first, then let them run your credit if its a good rate.

 

<div class='quotetop'>QUOTE(lovebug @ Jul 6 2007, 06:01 PM) [snapback]474368[/snapback]</div>

Basically, a lot of dealers will tell you anything they think will get you to buy the car right now. Because they know that if you leave, there is a high probability you will buy a car from someone else.

The finance guy is usually the best sales guy they have at the dealer. They also tend to be deceitful. What ever he called it, if you borrow against your house, its some type of mortgage or home equity loan.

IANAFA (I am not a financial adviser), but I think your financial adviser would tell you that for most people, the IRS restrictions would make it difficult to use your car purchase as a tax deduction. I think that the expense has to be related to improving your home and the amount that is tax deductable is the difference between your original purchase price and whatever your current balance is. Not the equity from appreciation. But again, IANAFA.

Also, in my opinion (IANAFA) its a bad move to remove money from an asset that appreciates (your home in most areas) and use the money to buy something that depreciates (a car). I think its better to use that money to improve the home (so it appreciates even more) or leave it so you build more equity. I have friends who borrowed so much against their house (one of the items they bought was a car) that now they cannot sell it because they have no equity. (Its not worth as much as they owe. )

 

SherlockBrady, read through www.carbuyingtips.com. All of the negotiation should be done before you go to the dealer. It should take about an hour to do the paperwork.

Some dealers are more ethical than others. If you go to the dealer on the last day of an offer you need to buy the car that day to get it.

 

Take care using a Capital One (or similar online bank) check. The fine print on the back states you cannot use it in a negative equity situation. What happens is if your dealer submits the paperwork, and it shows you were upside down on the deal and didn't put any money down, Capital One will refuse the loan (this is a week or so later after you thought you bought the vehicle). Fun ensues.

 

Hey there,

We recently were offered a 6.3 by our creit union, and then at the dealer we were offered something over 10 percent. I suspect there are shady deals at some dealers. We found another dealer and another beautiful prius and would recommend to anyone to get their financing directly from a credit union, or a bank if you can't get a membership to a credit union. That way all you have to do with the dealer is negotiate a price.
Good luck!


<div class='quotetop'>QUOTE(SherlockBrady @ Jul 6 2007, 07:55 PM) [snapback]474325[/snapback]</div>

 

They offered me 10.3% at the dealer with no co-signer, I'm 18 so I have limited credit history and despite having a good-paying job it is in the film industry where you may be "between jobs" for a year or more. I took it only because I intend to have it paid off by the end of the year and it was the path of least resistance. I got a letter two weeks later from TFS saying they reduced it to 9.3%. Not sure why.

 

Curious, which dealer in LA was that?
thanx, tom

 

<div class='quotetop'>QUOTE(4jules @ Jul 10 2007, 08:53 AM) [snapback]476141[/snapback]</div>

Northridge Toyota, Mike D'Angelo (Internet Sales)

Mike was good but the rest of them are scuzzy.