stockae92

I haven't bought a new car for long time already so i can't answer my friend's question.

But whats the APR for a purchase should one expect at a dealer? Besides those special offered. (0% or 0.9%)

My friend has excellent credit score (800+) last time he checked

dombey

totally depends on the dealer. it's a black box.
Most credit unions will get you into the 4% range no sweat with great credit; so I'd shoot for that unless they have promotional financing going on (check edmunds for that).
As always I'd suggest doing the math on a lease instead of a purchase if your friend doesn't firmly plan on having the car for 6-7 years.

dombey

^in my experience, tell the dealer you KNOW what your credit score is, and ask them the rate before they run you. If they come back at like 7%, tell them to F off. If they insist it is the best they can do, tell them you're going to go shop your loan at some credit unions and maybe even another dealership because you worked hard to maintain your credit and you refuse to pay excessive finance charges....they'll get you to where you want to be, most likely.

TheDonEffect

Dealers make commission off of the loan too, and those rates are negotiable, if you go online to edmunds or whatever they'll tell you the rates you can expect given the market you're in. Oh and if you haggled the price of the car down to where you wanted it, odds are that they're going to try and make up for it on the loan side.
http://www.bankrate.com/auto.aspx
My gf got her car at around 7% which sucked, but she did buy it used, first car, no real credit aside from student loans, sucks cuz had she bought new she would've gotten hondas 2.9 or toyotas 0, in my experiences I found they;re more lenient with new cars mostly because the finance companies tend to be the manufacturer's finance company so they have added incentive to make the loan.
So if you're buying new, I'd always wait for the financing specials, well worth the wait, there's almost always the car you want, and dealers tend to be just as willing to to haggle on prices.

whiteflash

get a payment that's a lot lower than you can afford, and pay what you can afford. Nothing makes your credit score scream like large loans payed off early.

dombey

yeah my father in law does that. Haggles the crap out of the price, agrees to pay 9% on the loan, then pays it in full with the first billing statement.

whiteflash

Smart man. I would have done that except this was my first large purchase and with a semi non-existant credit history you have to end up paying to play. Great credit with short history is still a risk. I plan to have it paid off by the end of it's 2nd of 5 years. The 7% in the meantime is a small price to pay for the benefits.

Ghostface80

Sure about that? I was told that u should keep installment loans (such as a car loan) for at least a year for it to really reflect well on your credit.

whiteflash

^ read above It really depends where your at in your history. If you're young and new to the credit game, I.e. no housing mortgage, zero maybe one car purchase, then yes you want to drag it out a bit. I guess the point was more, because you can afford $400 on a car payment doesn't mean you should buy a car that will run you $390. At least for the fiscally responsible. To each their own.

After you've established your credit, you can keep loans floating for a bit or pay them off asap, after a while as long as you're not damaging your credit, all things are equal.

ThatSlowKid

I was with my cousin when she bought her G37s and the dealer had a special of 1.9 for 5 years. They did a lot of crap to say that her score wasnt good, she got a co-signer eventhough her score was excellent.

Then they said that it will be 2.9 because there are two people on the contract. And as she got more upset, the more shit I was hearing from the salesman. Until I and her sister (co-singer) said that okay we are going to buy it from somwhere else or get the loan from a credit union.

He went back and forth, and came back with the offer of 1.9% apr for 5years on a brand new g37s.

Thats my knowledge and nowadays i think all new cars have around 0-3.9% apr deal.