NEW AUTO LOAN RATES??? Any tips?

[JLUandCJ-7]

People say this but what no one accounts for is the additional risk you assume in doing so. It's not like you're investing in risk free Treasury bonds, so a flat comparison of interest rates is inaccurate. Imagine if a dealer offered to do the same but just handle the investing for you - you buy the Jeep and pay cash for the full amount and in 5 years the purchase price would be adjusted according to stock market performance, with you then settling up with the dealer for either a refund or suddenly paying the dealer thousands more. Few would choose that option, even though as I describe it, it's equivalent.

Everyone has their own risk profile. And you should never invest more than you can afford to lose.

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[Steveo]

It makes a lot of sense if you invest the cash and get a better return than the financing rate.

But then it's not cash any more because you've purc

For example, I financed my Jeep at 2%, and was able to increase an investment that has returns of 18% annually. Between the 6 years of dividends, and the appreciation upon disposal of the investment, the extra I included due to financing my Jeep will pay for 80% of the Jeep.

I'll admit that "safe" 18% returns, and trustworthy investments like this are hard to find. It's not the norm. An option that everyone can get into are REIT dividend yield stocks, which can get you to 9% and aren't affected as much by the ebbs and flows of the overall market.

Well then that's a very different scenario than the one in your original post, isn't it? It also begs the question why such a savvy investor would even bother asking a bunch of strangers on an online vehicle forum how he can do better than a 6% interest rate on a vehicle loan.

 

[BuyHold]

"makes more sense to finance a vehicle vs tying up a bunch of cash in a depreciating asset"

Are you sure about that The financing is a separate product and only increases the cost of buying the vehicle.

There are cash flow considerations of fully paying vs financing, no doubt about that. However, if OP wants to tie up a disproportionally larger amount of their future cash flows in form of high(er) interest rates because the asset depreciates rapidly then who am I to argue with that logic?

Why not stop there?! If depreciation rates determine financing strategy then OP should just buy a 392 XR with all cash. Many members of this forum seem to think that the value of 392s won't decline much, some even think they will go up given V8-collectibility at the sunset of ICE vehicles. Therefore ALL CASH!

 

[JLUandCJ-7]

Well then that's a very different scenario than the one in your original post, isn't it? It also begs the question why such a savvy investor would even bother asking a bunch of strangers on an online vehicle forum how he can do better than a 6% interest rate on a vehicle loan.

#nottheOP

 

[Steveo]

But here's my point...the question was prefaced with " Buying cash is an option but its not ideal, ...". If you have or will invest the cash then you don't have it as cash to buy a vehicle with any longer as it's now been converted to a different kind of financial instrument.

 

[JLUandCJ-7]

But here's my point...the question was prefaced with " Buying cash is an option but its not ideal, ...". If you have or will invest the cash then you don't have it as cash to buy a vehicle with any longer as it's now been converted to a different kind of financial instrument.

Ok

 

[Birdcatcher]

Got a Jeep 392 from Koons less than a month ago. They hit me with a rate of ~5.8% for 5 years, ~50% down with my credit score of 8xx. I said no thanks.
BTW - Koons did not offer me any rebate for financing with them.
They did not even honour the full 1% for tread lightly even though I had the full documentation, original membership letter, the control number issued by TL. They said they'll do $350/-. They said it does not apply to the JLUR 392 and ultimately it's at the dealership's discretion.
If Jeep/ Stelantis discounts the dealership 1% for Tread Lightly, in my opinion, they committed fraud by not passing the 1% down to me. (...but I am not a lawyer, just saying...)
Buying and owning this Jeep has been the worst experience so far...

 

[TexazGuy]

I financed my Jeep JLU at 3.67% for 72 month last month through Truist.

 

[Morrepe]

Check the fine print. Koons requires Chrysler financing or they’ll hit you for $1,000 on the PP. At least that’s what they told me. Required to make three payments and then can prepay or refinance with no penalty.

 

[Astro Jeep]

If you have liquid cash to outright buy it then do it. You will be less poor in the long run.

Then you could pay your savings what your monthly Jeep payment would be. At the end of your term you will have more money in the bank than what you would have had otherwise.

 

[dougiebros]

Nice thing about Jeeps is they don’t depreciate nearly as much as other cars. If you have the cash, buy it outright.

 

[Jeeppaul91]

If you have liquid cash to outright buy it then do it. You will be less poor in the long run.

Then you could pay your savings what your monthly Jeep payment would be. At the end of your term you will have more money in the bank than what you would have had otherwise.

I‘m in real estate, cash on hand is for the opportunities ahead… lots of foreclosures coming and being able to snatch them up is key. A lot of people are going to lose a lot of money in the next few years, and a few people will make a lot of money.

 

[Kyanche]

Definitely local credit unions, and penfed/dcu/nfcu if you can get quotes from them! They sometimes have great rates!

You do have a period of time where it won't hurt your credit extra to shop around.

Good luck!

If all else fails: You can always refinance later - it's pretty painless.

 

[Jeeppaul91]

Well then that's a very different scenario than the one in your original post, isn't it? It also begs the question why such a savvy investor would even bother asking a bunch of strangers on an online vehicle forum how he can do better than a 6% interest rate on a vehicle loan.

The reason I asked is because pretty much all of the major banks that I looked into are listing interest rates in the 4% range as of this morning. A couple of the local credit unions that I’m eligible to join where I live are all the same as well, best I could find was 4.249%. - not exactly a stellar rate. I don’t qualify for the credit unions around here with the super low rates, its pretty much all employer related up here in PA, and none of my family members use credit unions so I don’t have an option to join that way either.

There are a lot of small credit unions all of the country that don’t pop up on ”auto loan rate” google searches, a couple of folks on here pointed out some decent options that I would’ve never have thought of (NUSENDA CU in New Mexico is a good example, 2.8% for 60 months ain’t bad). Looks like there isn’t any specific criteria to join that one either, I may be able to open an account there tomorrow. I guess my post may have delivered some results after all.

I wouldn’t necessarily question someone’s financial/investing knowledge or prowess based on asking a typically friendly community where they got their low rates at. From my experience, being the smartest guy in the room never got me too far, I’d rather ask a question and risk looking like incompetent vs trying to be the guy with all the answers.

 

[slowpoke387]

I‘m in real estate, cash on hand is for the opportunities ahead… lots of foreclosures coming and being able to snatch them up is key. A lot of people are going to lose a lot of money in the next few years, and a few people will make a lot of money.

Same with cars. People begging to pay ADM’s equates to being very upsidown.

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