Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Is there a resource somewhere to give a ballpark of what may be considered a good rate?
I am in the process of purchasing a new vehicle, a 2012 Infiniti EX35. Through dealer incentives, I'll be taking out a 34k loan on a 60 month term. I am 23 yrs old with relatively decent credit (low 700s). This will be my first car loan by myself, however I did have a previous note where I had a co-signer with perfect payments over the course of 4 and a half years.
I was approved at 4.99% through Infiniti's manufacturer financing. This is also a new vehicle.
I am trying to figure out if there's somewhere that I can go to learn more about what is considered a "good" rate (especially at my age considering short term credit history), or if I should hold out and do a bit more searching - I'm not sure where I would go to possibly get something lower than this, but I also don't want to pull my credit 15 times in the process.
Last edited by stargirl007; 10-08-2012 at 01:22 PM..
My Credit Union is doing 3.99 (EFT from account) 4.24(Coupon book) on a 5year loan.
Question is at 23,, do you Need a 40K+ car?
I don't have any living expenses outside of utilities, so yes - from a personal standpoint, I am willing to make a purchase on a more expensive vehicle for long term. Especially considering many days I spend more time driving than I do in my own home. It's all personal preference, I feel. While someone may splurge on electronics or other hobbies, I am much more willing to put my money into a great vehicle. I also am an avid, serious couponer as one of my main hobbies - so over the course of the past 3 or so years, I have saved thousands upon thousands of dollars per year on groceries and other household/personal items.
There are several places online that you can get pre-approved up to a certain amount of money for an auto loan. They will send you a blank check and you fill in the amount. You can shop around to several different places online to see what rate you can get. You can also check with your credit union/bank.
Never, ever go into a dealership without working out what financing you qualify for ahead of time. They will tell you that you are too young and without enough credit history, and they have no incentive to give you a competitive rate. If you go in with financing already worked out, they must beat what you already have from multiple sources.
Also, I should reiterate, really think about the opportunity cost of the monthly outlay on this car, especially considering that you mention just recently paying off a car note? Is that car still in good operating condition? I made the same mistake when I was your age of getting a car at 23 with monthly payments, although with a used car about half the price of the one you are looking into. I wish I would have used that money toward long term investments.
It also sounds like this is a somewhat uncertain time for you, with credit card debt that you are paying off plus student loans and having just recently started a new job after a lay off, and considering going back to grad school, be careful what you commit yourself to. All that couponing can be for nothing if you don't apply that same couponing mentality to the larger purchases.
you'll get all sorts of comments on the amount you're spending on a car due to the nature of the forum you're posting this question on, but all I'll say is - if you know you can afford it, then that's your decision.
As for your question, you'll get more favorable interest rates on a shorter term auto loan. my credit union (PSECU - One of the largest credit unions in Pennsylvania) is currently offering 2.49% on a 37-60 month term, or 1.49% on a 1-36 month term. 4.99% is 61-72 month term. Just to give you an idea of what's available out there.
Mortgage Rates Credit Cards Refinance Home CD Rates by Bankrate.com is a good tool for this sort of thing as well. shop around though, because you'll likely get a better rate than 4.99%. if you need to, maybe put a larger down payment to get a better rate. talk to the banks/credit unions.
Your credit might be pulling you down a bit. Top credit should get around 2%, to give you a reference. Try shoping more places. Check local credit unions too.
A good rate for a car loan is any rate UNDER what those same funds are earning in your investments. We took out our first car loan in 20 years because we got 0% financing. It made financial sense to do so.
I would NOT buy a 34K car at your age and stage in life. Sure, NOW you only have utilities to pay, but what about in a year when you want to buy a house or get married or in a couple years when you have a kid. A lot can change in those 5 years---number one being you LOSE YOUR JOB. Sorry, lower your expectations and be reasonable with your expenditures.
Is there a resource somewhere to give a ballpark of what may be considered a good rate? I am in the process of purchasing a new vehicle, a 2012 Infiniti EX35.
Perhaps the Auto forum would've been the place for this, as few there would comment on the borrower. FWIW, I did similar back in the day, and had no regrets...
Now to the loan itself - unlike retail finance, automakers offer rates based on sales, and the EX35 (all versions) is selling very well (based on planned volume) without incentives, thus Nissan isn't offering much in the way of subsidized rates on either loans or leases. In this case, you may be better off w/your bank or CU.
Good luck, & enjoy the ride!
I was in the exact same situation you are in when I graduated college at 22. I bought a car at 23 and I had a credit score that was exactly 691, now its much higher. I was offered a rate of 0.9% for 60 months by Honda, and a rate of 1.9% for 60 months by Volkswagen. It was during the time of the Tsunami so Honda had barely anything in stock so I went with the VW. Volkswagen also paid my first months payment for being a college grad. I just learned recently that Honda now has a 0.0% APR for 60 Months for new buyers. I wish I were looking for a car now to get that rate.
With that being said, I think you are getting a bad deal. But there are a couple of factors that play into it that I am unsure of. 1) Whether or not the fact that I have a college degree makes a difference. 2) The car you are looking to buy is considered "luxury" versus a Honda or Volkswagen.
So let me ask you this. Do you have a college degree? Are you 100% set on buying the Inifiniti?
I worked at a credit union that offered rates as low as 1.99%
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
