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I disagree, responsible people finance cars every day, or do you also think no one should buy a house if they can't pay cash. And why are you concerning yourself with who the OP dates, and how do you know anything about them? wow, just wow.
No, I do not believe in borrowing money, might make sense to those with high incomes, but for the average person with less than stellar credit, its foolish. I have not borrowed money in 30 years, if I can't afford to buy it oh well, bought my 4th home a few years ago for $18,500 cash on the courthouse steps, its 20,000 sq ft mansion, albeit in rough shape, great neighborhood. Cash is King in this world if you know how to shop.
We obtained loan pre-approval from our bank and then went shopping. Strictly a cash deal for the local dealer. We sold our car to CarMax which further simplified the transaction for the dealer.
By keeping the transaction with the dealer straightforward, they were unable to screw us by upping their back-end gross (sales of extended warranties, add-ons, in-house financing, etc.)
No, I do not believe in borrowing money, might make sense to those with high incomes, but for the average person with less than stellar credit, its foolish. I have not borrowed money in 30 years, if I can't afford to buy it oh well, bought my 4th home a few years ago for $18,500 cash on the courthouse steps, its 20,000 sq ft mansion, albeit in rough shape, great neighborhood. Cash is King in this world if you know how to shop.
The OP Asked: "Is it shady that a car dealership contacted me and said blah blah blah..."
The OP Did Not Ask: "Is it okay to get a loan to buy a car?"
"Does anyone think it's a bad idea to borrow money to buy a car?"
"Do the posters at C-D approve of my decision to buy a car with financing?"
I just want some advice from those of you who are more experienced than I am when it comes to car loans. I applied online at 3rd party website for a car loan. I only got a response from 1 dealership, Heritage Mazda of Bel Air. They first called me on Friday afternoon and went through my credit app over the phone. I got a call back Monday saying they had a bank that approved me. I asked about specifications of the loan (how much did they approve me for, is it new or used car, etc). The finance rep kind of dodged my question a bit and said I have to choose a car first to get loan terms, but they approved me for up to $600/mo. She was really vague and just asked me to bring in my DL and paystubs when I came into the dealership. She also said "Yeah well I just put it through a bank that I knew would approve you, but we may even end up switching banks." I asked her about down payment and she said "I wouldn't worry about that, we'll probably be able to get that through rebates". Anyone else been through this before? I'm confused how they would approve me for a 600/mo payment with no terms as to new or used, or any sort of guidelines. I really wanted to know specifics so I could be prepared and have an idea what I'm looking at. Is this a shady way of getting you to come into the dealership? Saying they approved you when in fact they don't even really have a concrete approval?
Do not EVER buy a car or anything else based on how much your payment will be. Negotiate the best price, negotiate the best interest rate and term, double check all the figures then see if you can afford what the payment comes to. If you tell them, or they tell you that you can afford $600 a month, I can guarantee your payment won't be less than $595 even if it could have been $450 elsewhere.
Read back and see all the posters that say paying cash is not realistic, that is what I was responding to, so blow it out your ___
Oh yeah, for the OP, just sign on the dotted line and let the men fill in what you owe, its the American way.........
And don't let them stick you with some wimpy interest rate 10% or higher is what you want.
Oh, please. Even during the credit rebuilding stage, I qualified for 5.9% financing. Car dealerships are not evil places that will ruin your life. You just have to be smart about what you agree to.
No, I do not believe in borrowing money, might make sense to those with high incomes, but for the average person with less than stellar credit, its foolish. I have not borrowed money in 30 years, if I can't afford to buy it oh well, bought my 4th home a few years ago for $18,500 cash on the courthouse steps, its 20,000 sq ft mansion, albeit in rough shape, great neighborhood. Cash is King in this world if you know how to shop.
Most people can't or won't purchase a home for $18,000
Denver area houses average easily over $300K. There are no livable houses here even near $18k, not even in the worst areas. Not talking about fixer uppers dilapidated properties.
I have some recent experience I'd like to share. Very recent. It actually happened today as a matter of fact.
When the economy took a dump back in 2008 I had to voluntarily give up my almost new Ford F150. I had lost my job and there was a huge screw up at the unemployment department so I had to wait several months to even collect my first unemployment check. In the meantime I went through my meager savings just to keep the roof over our heads and despite my best efforts I had to contact Ford and tell them I can't make the payments on the truck anymore and to come get it back.
That was my last new/financed vehicle for a while. Ever since then it had been a series of "Craigslist" cars that I bought every spring with my meager tax refund. I drove them till they inevitably started having issues and then sold them and bought something else. It was a sad and endless cycle of crappy used cars. Eventually the economy picked up and I got a full time job again and I needed something reliable for work. The car I was driving at the time was doing fine until it suddenly developed a cracked head gasket which would require repairs that I simply couldn't afford. I managed to drive to a dealership and even though my car was essentially junk they gave me $1000 trade in and gave me a month to come up with another 800 dollars which I could afford to do. They put me behind the wheel of a 2012 Honda Fit with only 30K miles on it. They made it so that my payments were well within my budget but the best part about it was that I was now "back in the game" so to speak.
Now that I was approved and financed on a two year old car my credit score gradually increased. Even though my credit took a big hit because of the repo and some past due credit card bills it did eventually improve enough where my FICO score surprised me in a good way.
Today I was out just looking at cars, mostly out of curiosity since everyone seemed to be having pre memorial weekend sales. Even though I was perfectly happy with my Honda I was impressed with some of the newer cars. To make this long story short I ended up trading in my Honda for something newer and better. Not only am I driving a better car butu my new financing is much better than what I received for the Honda. My payments are lower, my APR is much lower at 2.9% and it wasn't even something I had set out to do. It just happened.
Buying with cash is always an option, of course, but it won't help you with establishing or repairing your credit. My credit wasn't all that great a year ago and after a year of steady on time payments (and some paid off credit cards too) it improved enough to be able to get a better car at better terms.
I just want some advice from those of you who are more experienced than I am when it comes to car loans. I applied online at 3rd party website for a car loan. I only got a response from 1 dealership, Heritage Mazda of Bel Air. They first called me on Friday afternoon and went through my credit app over the phone. I got a call back Monday saying they had a bank that approved me. I asked about specifications of the loan (how much did they approve me for, is it new or used car, etc). The finance rep kind of dodged my question a bit and said I have to choose a car first to get loan terms, but they approved me for up to $600/mo. She was really vague and just asked me to bring in my DL and paystubs when I came into the dealership. She also said "Yeah well I just put it through a bank that I knew would approve you, but we may even end up switching banks." I asked her about down payment and she said "I wouldn't worry about that, we'll probably be able to get that through rebates". Anyone else been through this before? I'm confused how they would approve me for a 600/mo payment with no terms as to new or used, or any sort of guidelines. I really wanted to know specifics so I could be prepared and have an idea what I'm looking at. Is this a shady way of getting you to come into the dealership? Saying they approved you when in fact they don't even really have a concrete approval?
She's lying through her teeth and just trying to get you in the door. You're just a hot lead they are pursuing. That's why they want you to bring all your info.
My advice, go to the banks or credit union and get a loan. The dealer is going to try to rip you of first with in house financing. If they can't get that, then they will shop around at the banks. This is what they are doing while you sit in the lobby for 5 hours. Eliminate all this by getting your own financing approval on your terms, not theirs. Then all you have to do is haggle the price of the car. DON'T tell the sales guy you have pre approval for a loan set up. Only mention this AFTER you signed the sales agreement and are sitting in the financing chair.
I love the people on here who say if you can't pay cash you can't afford it...
These are usually kids who's parents bought them a car or adults who are financing a car. They are laughable and to be ignored.
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