I should have never bought my Prius...

Is that monthly or annually?

 

because we had this great period of time called the Reagan years, where everything was deregulated, including finance. Allowing predatory lending and outrageous interest percentages.

 

I'm currently running a 5.25% loan (APR) that started in Jan 08 and runs 36 months. I put down $10,000 and financed the remaining $15,900 and the payments are $481.96. My credit union was able to secure the loan and offer 6.00% originally, but with their GREEN program, it knocked off 0.50% and for auto-pay, another 0.25%. In fact my next payment is due next Tuesday. I guess I'd better get back to work to make my next payment.

 

To anyone paying interest on a car loan. Remember - never finance a depreciating asset. (although with a prius it's not such a problem).

 

No, this doesn't sound like the wisest financial decision you could have made, but it also may not have to turn out to be the worst either.

You're in a unique postion in that you own a car that is very desirable right now. You may be able to use that to your advantage to get out of what would otherwise be a tight place. Of course, it would mean selling your Prius.

If I were you, I might be thinking along these lines:

• How much could the Prius be sold for?
• How much do I owe on the Prius and the previous obligation on the Malbu?
• What would it cost to get another car?

Those aren't intended to be answered here, but the answers to those questions might help you see another way out of this, if it's appropriate for your situation. You've got to think that one through on your own.

Ownership of the Prius (or any car) is really based finding a balance between what you want and what you can afford.

Yes, there are certainly many advantages to owning a Prius, some tangible and some not so tangible. But none of those benefits are worth being in bad financial position to have.

 

car payments suck... i vowed years ago never to do that...have been lucky on last several car purchases. have only had car payments twice in my life... one was repo'ed, the other was wrecked after 6 months... car payments very bad karma for me!!

 

I don't agree with this.

I would never pay cash for a car, and its not that I couldn't if I wanted to.

Why?

Because my money earns a return for me which is significantly greater than the interest on the loan. Why would I want to liquidate investments which make me money and sink those assets into a peice of property which LOOSES money?

Financing options are financial management tools, and as long as they're used properly theres nothing wrong with them whatsoever.

Its kind of like paying off a house. I never want a paid off house until I have no income to protect. Why? Again, the money makes me way more in return than the interest on the mortgage, and the mortgage interest is tax deductible!

 

Sheesh. My credit rating is over 760 right now and they're hinting at about 6%. What can I do to get it down to 4.5?

 

Do you belong to or can you join a credit union? My credit union is offering 4.5% on car loans.

 

I got 7.9% from Toyota Financial which isnt bad for a First Time Buyer. My credit union wanted to give me 11%

 

Easiest way to lower the rate is to lower the months, ie 48 months instead of 60.
Check your credit union for lowest rate, ask the dealer finance officer to beat that rate.

 

My home and car loans are currently about 10%.
One thing the USA has over Australia, cheap money.
I guess that is due to our run-away economy going gang busters.
They had to slow it down somehow. My home loan has never been under 6%.

BTW, nice first post in this thread.

 

If your credit is 713, you should be getting better rates than that...

Honestly, you need a credit card to establish excellent credit. Just pay the thing off every month.

 

What's the spread?

 

there is a lot of reasons to have a credit card and none of the good reasons have to do with the ability to pay...

i charge something on my card today, and i get a portion of that back...either points that can be redeemed for merchandise or even cashed in for money, or simple cash back... i have 3 to 6 weeks before i have to "pay" for it out of my interest paying checking account. so the longer the money stays in my checking account, the more interest i earn...my debit card, i spend it today, i lose the interest on it today.

i have 2 primary cards simply because their payback is best in different areas. i never carry a balance, so the interest rate on the card is a non-issue (in fact, i dont know what any of my cards interest rate is except one which is like 14%... or at least it was a few years ago when it was droppped from 17%. they made it such a big deal which is why i remember it... i thought it was rather comical)

so having a card is nice...and these days, fraud is much harder to get away with... i have my capital one card was frauded last month. they called, asked me about some recent charges made in California, i said they were not mine, they canceled the card (sort of... i could still use it, but had to fill out paperwork telling them which charges werent mine) they sent me out another card a week later and that was the end of that. all in all, my ability to use the card was never restricted... i now have a new one and life goes on.

 

i believe my fica score was about 650 avg and i still qualified for toyota's 4.9 % deal

as soon as gas goes down to $2 or so a gallon people will stop buying hybrids as much
and toyota will offer incentives again

 

Reaaly? One thing you are forgetting, we're not all swiming in cash like you are.

 

I didn't know anyone was using drafts anymore. I do understand why the dealer would refuse drafts, however.

It used to be that a lot of credit unions issued drafts instead of checks but that was a long time ago.

Bob

 

I was lucky enough to buy mine last year when Toyota Financial was offering 0% for 24 months on the Prius. Each month one of the 24 no interest payments magically disappears from my money market account.

Yesterday I got a nice letter from them -- They want me to buy another car so that they can loan me some more money -- this time with interest.