Or try to see if I can finance it with 0% for X amount of months and then pay it off then? My credit is decent but I would love for a higher credit score.

11/25/2011 4:04:44 PM

If you can get 0%, then you should take the loan. No brainer.

11/25/2011 4:30:16 PM

The one and only time I bought a vehicle new off the lot I financed it then paid it off on the third monthly payment. I'm afraid I don't know how that affected my credit rating however.

11/25/2011 4:53:56 PM

What would be your interest rate?

11/25/2011 7:47:31 PM

I'm not sure, haven't applied for a loan yet

11/25/2011 8:29:02 PM

That is going to be the deciding factor.

11/25/2011 8:38:36 PM

From what I've seen they will give you a better deal if you pay cash when they offer 0%. For example, they might offer you a car for $20k if you do 0% financing or $18.5k if you do cash. You should inquire with your salesperson. If your cash is generating 1% at the bank you're not going to lose much by paying up front.

11/25/2011 9:15:50 PM

Buying a new or used car from a salesman is a shell game. They plan to make their money on you somewhere, be it in interest, price, add-ons, trade-in, etc.

My technique would be to negotiate for the lowest price you could, irrespective of interest, then either refinance it or pay off the loan outright afterwards.

Quote :

"If you can get 0%, then you should take the loan. No brainer."

[NO]. 0% financing is never a free lunch. They will never give you as good of a price with 0% financing as they will otherwise.


I've seen banks and credit unions that will finance even used cars at 1.99-2.99%. I could buy any car that I would reasonably own with cash, but at 2% interest, I would finance without even thinking twice. I'd rather have the cash on hand, and there's an opportunity cost with not investing it elsewhere--even conservatively--at >2%.

11/25/2011 10:13:05 PM

I would think it depends on if you have any other debt and its interest rate. If your debt is at a higher interest rate than a car loan I would pay off the debt first.

11/27/2011 10:18:05 PM

I have zero debt.

11/27/2011 10:22:25 PM

If you dont have much credit, and you dont have a house already, then finance it. You need to build a credit history, and financing a car is a good start.

I suspect since you have no credit card debt, your credit score is lower because of lack of credit. This is only going to affect you more the older you get. Paying a large loan on time for a long period of time is going to increase your score.


[Edited on November 28, 2011 at 2:17 PM. Reason : .]

11/28/2011 2:16:04 PM

credit score is pointless. if you can really afford a house loan, then you can get it underwritten.

11/28/2011 2:55:40 PM

I know people that have great jobs, have shunned credit and assets, and its given them grief when they needed it.

Quote :

"credit score is pointless"

I'm not sure how I respond to a completely ridiculous statement. If you intend on never having a loan, then it is pointless. Otherwise, it isnt.

Just so we are clear here. If the poster is lacking credit, and the loan rate is low, the poster should consider financing it.

[Edited on November 28, 2011 at 3:26 PM. Reason : .]

11/28/2011 3:13:06 PM

Quote :

"credit score is pointless. if you can really afford a house loan, then you can get it underwritten."

what.................the.....................fuck?

12/6/2011 8:04:15 PM

that's the response that statement usually gets. if you enjoy living free and clear without debt, you don't need a fucking credit score. really a shame that debt has become the norm.

12/7/2011 6:09:56 AM

Quote :

"that's the response that statement usually gets. if you enjoy living free and clear without debt, you don't need a fucking credit score right now, but will be hating life when you actually need a substantial loan for something like a house and they check your..... CREDIT SCORE.. really a shame that debt has become the norm."

Fixed it for you. It IS a shame debt has become the norm, but it's stupid not to use your ability to manage money PROPERLY to achieve a stupid high credit score that gives you the ability to obtain the lowest rates on loans when you actually need it for something like a house. I'm not saying you should carry a balance on your credit cards month to month, but financing a car at a very low interest rate while helping build a credit history and high credit score is not the same thing as running up your Chase card and carrying a balance at 15% interest and paying the monthly minimum.

I'm going to assume you're trolling from this point forward. You have to be smart enough to see the benefits of using your "free and clear" cash to build a true credit history in a legitimate fashion vs. "being in debt".

12/7/2011 7:28:11 AM

^ you can't argue with ^^... some people are blinging enough to buy a house in cash outright.

however, 99.9% of the world can't.

12/7/2011 7:31:39 AM

^more like 99.9% of the world doesn't want to wait to save up cash on hand to buy their house...

12/7/2011 8:10:27 AM

Quote :

"will be hating life when you actually need a substantial loan for something like a house and they check your..... CREDIT SCORE"

like i said, if you can actually afford a house, you can get it manually underwritten.

12/7/2011 10:05:00 AM

http://bit.ly/rFJHGx

Not that it isn't still possible to do, but you make it much more difficult one yourself for really no reason. I'm not saying that you don't have a point if you're trying to make the point that credit scores are a racket of sorts. It's a game that credit companies want you to play and hope that they win and you lose out so you incur interest fees.

But it's an easy game to win as a consumer, particularly if you have a lot of liquid assets. There is very little reason NOT to achieve a high credit score because it's incredibly easy to do if you can manage your money. If you're the type of person who can get a loan manually underwritten... you're the type of person that should be smart enough to play the credit score game and come out way on top. It just makes your life much easier.

I'm not saying you cannot successfully go through life without ever trying to establish a credit history. You can, people do it. It's just a lot more hoops to jump through just to be a hipster.

12/7/2011 10:49:20 AM

haha this house buying conversation is silly.... guys, really, i'll slap any of you on the back if you can save up in any reasonable timeframe $120k+ to buy a fucking house outright and say 'atta boy'.


fuck that shit. OP, buy the car already and lets' get back to gayragin



EDIT: and I know two people that poo-poo'd the whole credit thing until they actually needed a decent credit score.

[Edited on December 7, 2011 at 11:05 AM. Reason : we're all not moneybags]

12/7/2011 11:03:59 AM

Eh, I ended up getting a 4% loan that was 0% for the first 6 months, will pay off in 6 months. Hopefully that's enough time for my credit score to improve a little.

12/7/2011 11:17:15 AM

+1 for DrPepper, not only do you offer 23 delicious flavors, but you also offer sound posting advice. Back to The Garage it is.

12/7/2011 11:17:35 AM

Or you could do what I did...
Put up $4500 cash and take out a $9000 loan from a local bank (Crescent State Bank in Cary) on a nearly new car. Pay off the loan in 18 months. Try to get a credit card from your current bank only to get denied for having no credit whatsoever.

Not all lenders report to credit agencies and just because you paid off a loan doesn't mean it has added to your credit score.
FYI.

It's just a sad situation...I did the responsible thing (at the time) and didn't take any of the credit offers that are pretty much shoved down your throat as a college student. Then, as a new hire, I financed a reasonable car and paid it off early. I was denied for a Kohls card when I was like 24 years old with zero debt and zero bad credit. A KOHLS CARD.

I had no idea if/when I'd be able to mortgage a house at the time and I didn't want to buy some new junk just to build credit.

Secured loans are a cheap way to build credit if you have cash. You can take out a $10k loan with your bank and secure it with $10k from your savings. The savings will continue to generate a nominal amount of interest and your loan interest will be pretty low because they're guaranteed to get paid. You're basically buying credit. I did this when I bought a BMW motorcycle that was barely less expensive than my savings balance at the time.

Also, look for banks providing ridiculously high interest on checking accounts if you switch. Toss some money their way and call it almost even. When I bought my Civic I had a bank paying me 4.05% interest on my checking account and I was paying 4.95% interest on my loan. I let it run until the bank lowered their rates and then I paid off the loan. It added to my credit and only cost a nominal amount.

Just a few thoughts since we're on the subject of credit.

listen to me. i know what the fuck i'm talking about.

[Edited on December 8, 2011 at 9:50 PM. Reason : -]

12/7/2011 4:17:25 PM

Quote :

"haha this house buying conversation is silly.... guys, really, i'll slap any of you on the back if you can save up in any reasonable timeframe $120k+ to buy a fucking house outright and say 'atta boy'."

I could come up with that much cash if I needed to, but if I bought a house with cash (especially if I had to liquidate any retirement savings to di it, which I would), I wouldn't want a slap on the back--I'd want a slap in the face for being such an idiot.

Money is cheap right now. When you can finance a car at 3%, or especially when you can finance a house at 3.7% AND deduct the interest on taxes, it just doesnt make much sense to pay cash.

12/7/2011 7:09:40 PM

i don't think anyone itt ever suggested paying cash for a house

all i was trying to say is that paying interest on something just so you can "build credit" is unnecessary, imo

[Edited on December 7, 2011 at 7:53 PM. Reason : ads]

12/7/2011 7:51:56 PM

Arguable and probably situationally dependent, but interest is no reason not to finance a car right now if you can get it at 3%.

Shit, I saw a credit union a couple of months ago running a promotion where they'd finance any car up to 10-years old at 1.99% for applicants with requisite credit scores (I think it was 740-750 or so).

12/8/2011 12:44:02 AM

^ Penfed if I am not mistaken... Isn't just for 48mo. financing, otherwise it's 2.99% for up to 60mo. financing?

12/8/2011 1:51:12 AM

Quote :

"i don't think anyone itt ever suggested paying cash for a house all i was trying to say is that paying interest on something just so you can "build credit" is unnecessary, imo "

that clarifies it for me.

12/8/2011 8:34:14 AM

Quote :

"like i said, if you can actually afford a house, you can get it manually underwritten."

you really have no clue. you can not just walk into a bank and say i want a loan and you need to manually underwrite it. of course there are some loans which are manually underwritten (Jumbo Loans are manually underwritten but these are loans above the standard conforming limits of $417,000) but 99% of mortgage loans are submitted through an AUS System (DU,LP,GUS) which returns an underwriting recommendation. i will leave it at this......if your loan is manually underwritten then guess what......your credit score and credit history typically suck!



[Edited on December 8, 2011 at 9:49 PM. Reason : -]

12/8/2011 9:23:38 PM

ok

12/8/2011 10:15:41 PM

it's usually a better idea to get an almost new CPO in great condition than a new car. that car loses several thousand dollars in value the second it leaves the lot.

12/9/2011 8:19:15 PM

I always imagined having $25K and just dropping it on a table in front of a guy, pointing to a car that's worth close to $30K, and saying that I have $25K and I want to walk out of here with that car. If they couldn't make it happen, I'd take these bills and drop by the next dealer over. I always wondered if there was a psychological edge in having cash instead of a check or credit card and if it could provide leverage to the person with the money.

12/9/2011 11:10:15 PM

^ They might say no just because they don't want to hassle with IRS form 8300

12/10/2011 12:06:50 AM

^agreed. i bought my pops a '10 nissan versa for 11,900 that had a sticker of 16,200 and intended to pay cash. they preferred i write them a check. so i did, a personal check of 11,900 out the door. they called the bank to verify funds. good deals can be had without plopping down a pile of cash.

12/10/2011 8:23:27 PM

Conversely, some Places like green money so it never gets reported to the IRS at all, haha

12/10/2011 8:28:45 PM

^Buy Here Pay Here

lulz

12/10/2011 9:15:08 PM