Last post on Mar 15, 2013 at 1:51 PM
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#2436 of 2451 Re: Auto Loan [sibsoner]
by kirstie_h HOST
Jul 17, 2012 (2:34 pm)
As qbrozen pointed out, it's the 19% interest that is causing the interest to pile up at a greater rate than you are paying off the loan. This will continue to happen if you continue to pay late on this loan. You will want to review the terms of your contract carefully, because there may be a provision, if you get a certain amount behind or are X number of days late a certain number of times, for them to "call" the note - this means that they would have the option to require you to pay the entire balance immediately, or face repossession. I can't tell you without reading your specific contract.
You are in a hole right now, but it isn't insurmountably deep. The way out is to pay on time, EVERY month, from here on out.
#2437 of 2451 Are dealers obliged to offer manufacture financing incentive?
Sep 09, 2012 (11:50 am)
I have just purchased a new 2012 Subaru Forester. But the dealer did not offer me the manufacture 0.9% APR financing special offer. Instead, the dealer had a bank financed the car with a higher APR. Is the dealer obliged to offer manufacture financing incentive? Is there any way I can ask the dealer to fix this? Thanks!
#2438 of 2451 Re: Are dealers obliged to offer manufacture financing incentive? [vcrt7tzwz1]
Sep 10, 2012 (4:59 am)
The answer is no they are not.
The finance person at your dealership must have obtained your credit score. You are entitled to that score, I believe. You should also check with one of the three credit agencies (Transunion for example) and pay for your actual score, not your credit report. You can also go to Credit Karma and get a good free estimation of your score. I use Credit Karma regularly.
With your score, you can see if you qualify for the special manufacturer captive financing. Typically, a score of 720 or more will qualify for the best auto finance rates. Note, the dealer may use a beacon score but your credit score is sufficient to determine if you qualify for the best or better than average rates.
If you have a sufficient score, you could confront the dealer and request an explanation. If you did qualify for the special manufacturer rate and you were not offered this by the dealer, you may find the dealer willing to correct the situation. There are laws and regulations in place regarding disclosure which the better dealerships observe. Unfortunately, it seems some dealer finance people skirt such laws and regulations.
As has been stated many times, in every situation, the dealer finance person is the dealership's best sales person. They have the responsibility of making as much back-end profit for the dealer as possible.
One highly profitable back-end profit avenue is financing. Dealers have access to finance rates which we customers may not have. A dealer can make a profit when the finance sales person finds a buyer willing to finance at a higher rate than the rate for which they qualify. For example, a dealer has a rate with a certain bank for three percent for which the customer qualifies. The customer finances at four percent. Bingo, the finance sales person has made a back-end profit with this one percent difference.
Clearly, it may not be in the dealer's best interest to finance a customer with the special manufacturer's financing.
If the dealer will not help you, you should consider an immediate refinance of the loan. If cancelled, the dealer will recieve a charge back from the bank for any profit made on the financed loan. You should also cancel anything else you may have purchased in the finance office such as an extended service contract, GAP, etc. Once cancelled the dealer will receive additional charge backs for those cancelled products as well. Dealer finance people hate charge backs.
People really do need to know their credit score before they enter a dealer's finance box.
#2439 of 2451 Re: Are dealers obliged to offer manufacture financing incentive? [billy3554]
Sep 11, 2012 (4:45 pm)
" There are laws and regulations in place regarding disclosure which the better dealerships observe. Unfortunately, it seems some dealer finance people skirt such laws and regulations. "
I have a score higher than 720. Are you aware where to find the law regarding the disclosure in Texas.
You also said "The answer is no they are not." If there is such law, why they are not obligated to tell me the manufacture financing option.
#2442 of 2451 car shopping?
by steve_ HOST
Nov 09, 2012 (2:27 am)
If you are in the process of car shopping, using online forums and tools and plan to visit a dealer soon, a reporter would like to hear from you. Please email PRedmunds.com by Tuesday, November 13, 2012 and provide a few lines about your experience so far.
Feb 15, 2013 (3:33 pm)
I have never leased a vehicle before, what is in involved, what's needed? How much cash do I need?
#2444 of 2451 Re: New Lessee [voyager950]
by kirstie_h HOST
Feb 18, 2013 (7:23 am)
This will depend completely on what vehicle you intend to lease. Could you give us an idea of what interests you, so we can point you in the right direction?
#2445 of 2451 Vehicle Financing
Feb 22, 2013 (10:06 pm)
I am just seeing if maybe anyone can help me out with a question. First, a little background on my financial history:
I have a credit score average of 565. I have a significant amount of debt but not credit card. Most of the debt is collections for accounts like personal loans, a cable company, student loans (all current and in good standing). I have a car loan out with a really high interest rate of about 25 percent/payment of 377.41 for 36 months (yikes, i know but i have a great job that pays well and i can afford to pay a high interest rate payment).
Although this interest rate is really high, i have not missed a payment nor have i been late on a payment. I have had the loan for about 22 months, so almost 2 years.
My question is, if i were to apply for a loan for a new car, and possibly trade this vehicle in, would i have a good chance of getting this loan approved? Will the history of good payments and ability to pay a high interest rate show that i am dependable with paying a car loan even if the interest rate is rediculously high? i want to be sure that i am not wasting my time if i go in to a dealership and running my credit if there is no point to do so. I am in need of a new vehicle, as my current one im still paying on is getting run down from driving long distances to work and back.
Any help and input form anyone who is a finance guru or has experience working with bad credit consumers would be greatly appreciated. Thank you so much!