Example of how not to borrow for a car

[Anonymous]

Her business, not yours.

Why are you counting someone else's coins?

[Anonymous]

I bought a $27K car with nothing down at 1.9 percent over 5 years. We had the cash to buy it outright, and were going to put 20% down, but we'd rather keep that on hand. That's worth a few hundred in interest per year to me.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Um how is this stupid? I'm looking for a car and can get 0%, why wouldn't I put down as little as possible?

How are you able to get 0%?

np. I bought my toyota highlander last year at 0% interest rate. Toyota financing was running a special and I had good credit. I also put my down payment on my amex so I could get the membership reward points.

[Anonymous]

Anonymous wrote:I also put my down payment on my amex so I could get the membership reward points.

CC don't normally let you pay your debts without additional fees. Are you sure they are not charging you 2% extra to pay via CC?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Um how is this stupid? I'm looking for a car and can get 0%, why wouldn't I put down as little as possible?

How are you able to get 0%?

np. I bought my toyota highlander last year at 0% interest rate. Toyota financing was running a special and I had good credit. I also put my down payment on my amex so I could get the membership reward points.

0% for what term? How much down payment did you pay? Did the interest rate depend on the amount you put as a down payment?

[Anonymous]

Anonymous wrote:

Anonymous wrote:This is pretty normal. What's the big deal?
Let me guess, you drive your cars for 15 years and then buy the next one with cash?

Let me guess, you borrow to buy a new car every other year and have $14.78 saved for retirement.

Wrong, but I do borrow at 0-1% interest and invest my money.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Um how is this stupid? I'm looking for a car and can get 0%, why wouldn't I put down as little as possible?

0% /= 1.99%

In practical terms it is. CPI here was nearly that last year. It's hardly significant interest, and particularly not when you consider the spread you'd get by investing.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I also put my down payment on my amex so I could get the membership reward points.

CC don't normally let you pay your debts without additional fees. Are you sure they are not charging you 2% extra to pay via CC?

They probably didn't but they probably violated the auto loan policy. Down payment on cc is like no down payment at all.

Here's an interesting fact - dealers aren't required by law to offer you the interest rate the bank will. They set their own.

If you really want to fuck a dealer over, have them charge you 6 or 7% in return for money off the car. Then go home and pay it off. The dealer will end up with a chargeback from the bank and you'll end up with an extra $500 in your pocket.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Um how is this stupid? I'm looking for a car and can get 0%, why wouldn't I put down as little as possible?

How are you able to get 0%?

np. I bought my toyota highlander last year at 0% interest rate. Toyota financing was running a special and I had good credit. I also put my down payment on my amex so I could get the membership reward points.

0% for what term? How much down payment did you pay? Did the interest rate depend on the amount you put as a down payment?

48 months and rate did not depend on down payment.

Also, there was no charge to put it on my amex. Of course I paid it off when bill came in and got a couple thousand points in return.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Um how is this stupid? I'm looking for a car and can get 0%, why wouldn't I put down as little as possible?

0% /= 1.99%

In practical terms it is. CPI here was nearly that last year. It's hardly significant interest, and particularly not when you consider the spread you'd get by investing.

Yep, this. Imagine how much a 5 year investment in the stock market in 2009 would have made today.

[Anonymous]

36 to 48 month loan at zero percent happens with good credit and dealer incentives.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Um how is this stupid? I'm looking for a car and can get 0%, why wouldn't I put down as little as possible?

How are you able to get 0%?

np. I bought my toyota highlander last year at 0% interest rate. Toyota financing was running a special and I had good credit. I also put my down payment on my amex so I could get the membership reward points.

Another NP here. I bought a 2015 Mazda earlier this month at 0% interest and put $8k down (also used my AmEx for rewards points! But my dealer said they had a $5k max on credit cards, so I did that and a $3k check). Financed nearly $20k. It's a 5 year loan.

[Anonymous]

So is it stupid to buy the car in cash if you have the cash?

[Anonymous]

Anonymous wrote:So is it stupid to buy the car in cash if you have the cash?

No. Most DCUMers just live to pay bills.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Um how is this stupid? I'm looking for a car and can get 0%, why wouldn't I put down as little as possible?

How are you able to get 0%?

np. I bought my toyota highlander last year at 0% interest rate. Toyota financing was running a special and I had good credit. I also put my down payment on my amex so I could get the membership reward points.

0% for what term? How much down payment did you pay? Did the interest rate depend on the amount you put as a down payment?

48 months and rate did not depend on down payment.

Also, there was no charge to put it on my amex. Of course I paid it off when bill came in and got a couple thousand points in return.

That sounds like a good deal. Thanks!