I’m refinancing this terrible loan and the bank person grimaced when they saw this.
hey millenials: car dealers are not a good choice of bank. please tell your generation about credit unions: https://www.logixbanking.com/rates/vehicle-loans
Definitely shop around, but sometimes the dealership does have an actual competitive offer. Especially if you threaten to use external financing (and have the pre approval in hand), they might knock down their interest rate to save the deal, as the loan is where the money actually is.
That is, if they approve you at all. Their requirements are higher, which is why you would get a better rate through them. If you can’t, you may need to go through a different company with a higher interest rate. Should that be the case, it’s best to consider getting a car (and the loan) significantly less in than what you’re approved for.
Is cash for a beater car no longer an option? I don’t want to be a “less avocado toast more bootstraps” person but a loan for a used car sounds wild to me. Maybe I’m out of touch. My vehicle is old enough to drink
Not often. Used cars, at least where I am, are all pretty pricey, and with rent and shit being out of control, I’m not surprised younger people can’t afford to save enough to buy one outright. I’m lucky to be older and I bought my current car at 0% interest in 2012. I’m keeping it until it gives up because I know we’ll never see that kind of deal again.
0% for a used car?
No idea if it’s still the same nowadays, but I also bought a used car in 2013 at 0% interest. It certainly was possible then.
Its still sometimes possible. Manufacturers will periodically run 0% interest loans specials for people who qualify. Tesla (don’t actually buy one) runs the deals all the time actually.
Nah mine was new but I think my ex only paid 1.9% on a used one. Interest rates were amazing.
Cash for clunkers removed a significant portion of the used cars from the market. It was a while ago but its effects are still very much being felt even if people don’t realize exactly what it is.
I would strongly advise against drinking your vehicle regardless of how old it is.
a loan for a used car sounds wild to me.
Predatory car loans has entered the chat.
I don’t know about Carvana, but plenty of scummy dealers will give insane rates to people with no credit check, repo the car while they’re still underwater on the loan, and sell it to someone else. You can have two or three people paying off the same car.
Oh, also, they somehow encourage the most gullible people who can’t afford their loans to just let the car get reposessed instead of attempting to sell it back to the dealer.
there are a lot of used ~2018 to 2022 cars on the market with not a lot of miles, most go for around $20k (like what I got). True beaters still go for like $10k.
Personally, I agree with your mindset, but I’m pretty handy with fixing/maintaining my own vehicles. For someone needing something to reliably get back and forth to work/school/daycare, I understand why people don’t go this route. Shop lead times have skyrocketed in the last few years, as have repair prices. Sometimes you just need something you don’t have to worry about.
A car that is the current model year is “used” as long as it’s had an owner. That’s what these loans are for. You can’t even get a loan for cars past seven years old with most lenders.
I mean yeah, that’s why I said beater. I just wouldn’t expect someone young or looking for a first car to be buying a current model year with low miles anyway.
I guess I was thrown when you said a loan for a used car was wild.
Since this is aimed at Gen Z, if you can buy a car outright or close to it, I would recommend still financing, but paying it off easily to build credit.
That’s just typical brazilian interest rates
