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I am buying my car out of state and need to have it financed be for they will ship the car. Any one every try Lending tree.com or any other site to compare loan's. Any advice?

 

 

I tried Eloan and they basically sent my info to a bunch of other places. Got back a quick your approved from them and someone would contact me. After 24hrs of waiting I called the people who approved me. Assuming I would get there advertised rate of 6-7%(cant remember exactly) they gave me all the details and said like 13% and I was like your crazy. Totally a waste of time for me. I ended up going with my Credit Union for around 7%. This was last spring so hopefully you might have better luck with lending tree.

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In my experience, credit unions seem to be able to offer the best rates. I'm planning on taking out a home equity loan to cover the balance of my Shelby. The interest rates on HE loans are usually a point or two higher than auto loans, but you can write off the interest on HE loans. Plus, you have more flexibility with the term of the loan. If I wanted to, I could drag mine out for 20 years. The drawback being, if you default on the loan, you lose your house. On the other hand, you do keep your Shelby :wacko:

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In my experience, credit unions seem to be able to offer the best rates. I'm planning on taking out a home equity loan to cover the balance of my Shelby. The interest rates on HE loans are usually a point or two higher than auto loans, but you can write off the interest on HE loans. Plus, you have more flexibility with the term of the loan. If I wanted to, I could drag mine out for 20 years. The drawback being, if you default on the loan, you lose your house. On the other hand, you do keep your Shelby :wacko:

 

 

..as a bonus, the back seats in the Shelby fold down to accomodate a sleeping bag. :woohoo:

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Credit Unions (CU's) typically have the best rates. The Federal Reserve has been increasing the prime lending rate slowly but surely over the last year, so rates at most banks are around 6-8% for someone with very good credit (not the 4-5% range it was a year or two ago).

 

I used a local CU for my Mach 1 and got much better rates than the banks offered. My wife used E-loan for her deal as they had the best rate going at the time (4.75% for 72 months). E-loan will only finance a small percentage over MSRP (to accomodate tax & license) so if you're buying a GT500 with a huge ADM, be prepared to have to pay for that out-of-pocket as cash down. Same is true of most banks, but there are exceptions. For example, Ford Credit can often approve loans as high as 150% of MSRP for someone with awesome credit.

 

For those buying out-of-state, keep in mind that once the car is back home you'll have to visit your local DMV to buy license tabs and pay your state's sales tax (assuming your state charges sales tax). This is a seperate transaction from the actual automobile sale, so you won't be able to put those amounts in your pre-done loan unless you work it out with your lender in advance. Forgetting to do this, or the inability to do this on your lenders part, means you're gonna pay a lot of money out-of-pocket once you get your car home to register it in your state. For example, a Washington resident who buys a GT500 out-of-state would pay 9.1% sales tax (that's about $4K-$6K, depending on selling price + ADM) if they live in the Seattle area (a little less in the surrounding areas). If your home state doesn't have a sales tax, then this is a moot point.

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The best way to do it is to set up a home equity line of credit to buy the car. I did and I got prime minus .26 of a percentadjustable. at least this way you can write it off on your taxs. However you better make sure you can pay the note or else they will take your house! but at least then you can sleep in your Shelby GT500 and people would call you crazy! :bandance: :happy feet: :shift::shift: :bandance: :happy feet:

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If you need the funds quickly and you have a home equity loan then just write them a check. If not, use a low interest credit card (gasp!) to get the car in your name, then do the finances and pay off the CC quickly. If you have time, get the CU car loan or a home equity loan.

 

JMHO

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If you need the funds quickly and you have a home equity loan then just write them a check. If not, use a low interest credit card (gasp!) to get the car in your name, then do the finances and pay off the CC quickly. If you have time, get the CU car loan or a home equity loan.

 

JMHO

 

 

According to a car dealer friend of mine, many/most dealers will not take a credit card on a car because the dealership has to pay the credit card company 2-3% of the total amount in fees. They might take a card for a down payment, but not the entire car.

 

I actually pondered the credit card option because I have an airline miles card with a $50K limit. I'd love to get all those miles.

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The best way to do it is to set up a home equity line of credit to buy the car. I did and I got prime minus .26 of a percentadjustable. at least this way you can write it off on your taxs. However you better make sure you can pay the note or else they will take your house! but at least then you can sleep in your Shelby GT500 and people would call you crazy! :bandance: :happy feet: :shift::shift: :bandance: :happy feet:

 

I don't know that I agree with this. What if interest rates rise dramatically? If you get a fixed loan NOW at, say 7%, and your HELOC is at 6% NOW but rises to 10% over the next few years, you would have been better off with the lower rate...even adjusted for the tax-deductability of the HELOC. Remember, you can only deduct the INTEREST you pay, not the entire payment. Also, check the fees on the HELOC. In some cases, you may require an appraisal of your home to ensure you have enough equity...which may negate any tax savings you have. Also remember that the attractiveness of tax-deductibility is largely a function of your tax bracket. If you are in a high marginal tax bracket, then it's a good deal. If you are in the lowest bracket, it's not going to save you much.

 

I agree that USUALLY credit unions offer the best rates. What is your FICO score? If it's above 720, you should try negotiating with a local bank for a better rate....they may drop it given your high FICO score.

 

Good luck.

 

Dave

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I don't know that I agree with this. What if interest rates rise dramatically? If you get a fixed loan NOW at, say 7%, and your HELOC is at 6% NOW but rises to 10% over the next few years, you would have been better off with the lower rate...even adjusted for the tax-deductability of the HELOC. Remember, you can only deduct the INTEREST you pay, not the entire payment. Also, check the fees on the HELOC. In some cases, you may require an appraisal of your home to ensure you have enough equity...which may negate any tax savings you have. Also remember that the attractiveness of tax-deductibility is largely a function of your tax bracket. If you are in a high marginal tax bracket, then it's a good deal. If you are in the lowest bracket, it's not going to save you much.

 

I agree that USUALLY credit unions offer the best rates. What is your FICO score? If it's above 720, you should try negotiating with a local bank for a better rate....they may drop it given your high FICO score.

 

Good luck.

 

Dave

 

 

The CC route should ONLY be used if you need to do the transaction TODAY. It is a stopgap. Once you have the car in your name there is nothing stopping you from mortgaging it within a week or 2 and using the funds to pay off the CC. But if you (can) use this route you absolutely need to follow up with other financing and get the balance on your CC paid off ASAP.

 

As for the HELOC, the tax savings will usually offset any rate hikes.

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B)--><div class='quotetop'>QUOTE(Five Oh B @ Aug 10 2006, 12:04 PM) 34242[/snapback]</div><div class='quotemain'><!--quotec-->

 

For those buying out-of-state, keep in mind that once the car is back home you'll have to visit your local DMV to buy license tabs and pay your state's sales tax (assuming your state charges sales tax). This is a seperate transaction from the actual automobile sale, so you won't be able to put those amounts in your pre-done loan unless you work it out with your lender in advance.

 

If one could get the dealer to write the bill of sale at MSRP(might be possible as a sort of quid pro quo to the ADM) do you have to declare the total cost? Just curious.
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I am buying my car out of state and need to have it financed be for they will ship the car. Any one every try Lending tree.com or any other site to compare loan's. Any advice?

 

 

Capital One Auto Finance is awesome. Best rate going other than CU. Super fast approval, will send you a blank check to give dealer overnight. I did one at 4 pm on a Friday and had the check before 10am on Saturday. They will drop rate another 1//2% if you let them auto draft payment each month. Other than a HELOC, they are the way to go. My banker of 25 years can't touch their rate.

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I don't know that I agree with this. What if interest rates rise dramatically? If you get a fixed loan NOW at, say 7%, and your HELOC is at 6% NOW but rises to 10% over the next few years, you would have been better off with the lower rate...even adjusted for the tax-deductability of the HELOC. Remember, you can only deduct the INTEREST you pay, not the entire payment. Also, check the fees on the HELOC. In some cases, you may require an appraisal of your home to ensure you have enough equity...which may negate any tax savings you have. Also remember that the attractiveness of tax-deductibility is largely a function of your tax bracket. If you are in a high marginal tax bracket, then it's a good deal. If you are in the lowest bracket, it's not going to save you much.

 

I agree that USUALLY credit unions offer the best rates. What is your FICO score? If it's above 720, you should try negotiating with a local bank for a better rate....they may drop it given your high FICO score.

 

Good luck.

 

Dave

 

 

If you are in a low income tax bracket you should not be even getting the car.

You should go buy some food for your kids!

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According to a car dealer friend of mine, many/most dealers will not take a credit card on a car because the dealership has to pay the credit card company 2-3% of the total amount in fees. They might take a card for a down payment, but not the entire car.

 

 

Depends what kind of profit margin you're dealing with. We took a $30k down payment with Amex because the guy was financing a Ford GT ($$$). Normally our limit is $4000 though.

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If one could get the dealer to write the bill of sale at MSRP(might be possible as a sort of quid pro quo to the ADM) do you have to declare the total cost? Just curious.

 

 

In the state of Washington, sales tax is due on the full sales amount (including ADM's and before any rebates are deducted). Hiding part of the total cost would be fraud against the state and likely carries hefty fees and/or jail time for those involved.

 

Rules likely differ around the country, so check with an expert where ever you live.

 

 

Depends what kind of profit margin you're dealing with. We took a $30k down payment with Amex because the guy was financing a Ford GT ($$$). Normally our limit is $4000 though.

 

 

Our store has a policy of $10K maximum on a credit card, regardless of whether it's the sales dept, parts dept, service dept, or body shop.

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As for the HELOC, the tax savings will usually offset any rate hikes.

 

Whether or not the tax savings will offset rate hikes depends upon many factors, including your marginal tax rate, the term of the loan, rate "spread" between the two loans, downpayment, market interest rate, etc.

 

Below is a quick analysis I did assuming 6% fixed rate loan vs. 7% and 8% HELOC loans assuming no interest rate changes. I also assumed the borrower had a marginal tax rate of 25%, which would apply for families with AGIs between $61,300 and $123,700. As you can see, the NPV (net present value) of the 7% "deductible" loan is better (a lower negative number) than the fixed rate loan. However, when going to the 8% "deductible" loan, the NPV is worse...meaning at that point you'd be better off with the 6% fixed rate loan. I assumed a 4% market interest rate, which is about what most people can earn with zero risk in today's environment.

 

Remember, this assumes rates are constant. Doing this analysis assuming rising rates on the "deductible" loans would require additional complexity and time, but would tip the analysis in favor of the fixed rate loan.

 

Dave

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Why I make a living working of of other people money. Let's sat I get a loan for the car at 8%. That is nothing compared to the profit I can make using the money in my business. If I turn the money every 2 weeks and earn 10% profit on that money every 2 weeks that would mean I would earn 10% 26 times in one year compared to paying 8% for the use of the money for that year.

Then if I compound that money with the money earned off of the profits I would more than pay for the car in a 1 year peroid.

You know when I think about it it will pay the car off in less than 1 year.The first month alone on a $50K loan would earn me $10,500.00.

Put that in you pipe and smoke it.

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Why I make a living working of of other people money. Let's sat I get a loan for the car at 8%. That is nothing compared to the profit I can make using the money in my business. If I turn the money every 2 weeks and earn 10% profit on that money every 2 weeks that would mean I would earn 10% 26 times in one year compared to paying 8% for the use of the money for that year.

Then if I compound that money with the money earned off of the profits I would more than pay for the car in a 1 year peroid.

You know when I think about it it will pay the car off in less than 1 year.The first month alone on a $50K loan would earn me $10,500.00.

Put that in you pipe and smoke it.

 

So, if your description is accurate and you can scale, then all you have to do is borrow some money...or raise it from friends and family if you don't have it already...and invest $1,000,000. That's a relatively small amount and should be easy enough to do. You'd make $210,000/month or $2,520,000 per year. That's 252%/year. That's before compounding. Heck, even if you invested only $250,000, you'd make $756,000/year.

 

Now, assuming the $1 million investment...if you did that every year for 10 short years and compounded annually, you'd end with $10,327,742,656 (...I haven't taken taxes into account). Look at that number...it's a little over 10 BILLION. I think I can find you some investors. Warren Buffet might even be interested.

 

The first part of my point: Something like this is never a straightforward analysis of along the lines: gee, I can borrow money and invest it the same as I invested the last dollar. Scalability and opportunity play into the equation. So does risk and your risk tolerance. You have to ask yourself what YOUR real investment opportunities are and compare those with your cost of funds. You also have to ask yourself if you like borrowing for toys (e.g. if your income is lumpy, you might night like to borrow for toys because it might take some of the fun out of it).

 

The second part of my point: If burnedgt500 can use $50,000 to earn $10,500 per month, then he's nuts to buy this car because his real cost is $10,500 per month ($126,000/year) to own the car...whether he pays cash or borrows the money. This is because, at the end of the day, debt and equity are no different when it comes to earning power...whether burnedgt500 borrows the money or has it in his pocket, he can still use it to make $126,000/year. He forgoes that if he buys the car. So, if he's going to borrow $50,000, he certainly should invest it and capture the income.

 

On a side note, I'm sure burnedgt500 can earn returns as he mentioned on a certain amount of money. But I seriously doubt it scales. And that's critical. Otherwise he'd be hanging with Buffet and Gates very quickly. And I'm guessing he'd be deciding how to borrow money to invest in his business...not to buy a GT500.

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As for an answer, I do borrow money to make money and it has paid off very well for me. Yes there are risk involved thats why I do it in a small scale not in a large scale venture.

The numbers posted above are also a gross amount. After all cost are exttracted I will net around 3%.(net profit each time I turn it)

However if I do not borrow the money it will be a dead cost to operate my business. by using my own capital it becomes money lost until profit returns. So by by borrowing an extra 50k to add to operating capital it would equate to total earnings. minus the 8%apr.

My business had been around for 30 years and is very strong right now. So the risk is not that high.

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I went to CU and got a good rate i have A high credit score so they gave me a really good rate and took .25% off for having it taken out of my account every month.

 

The dealer i am buying from is collecting 6% sales tax (same tax here in florida) so all i have to do is pay for my tags in Florida.

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Btw you can have the state taxes included on the purchase order the dealer just has to cut the check to the dmv. Most CU's do their out of state or non franchised deals via sight draft as opposed to a check. This is basically a promissary note. If this is the case make sure your dealer will take this as payment and not give you a hassle. Also the home equity tactic works if you plan on selling your house. Otherwise I would pay the car note unless you can't get a loan.

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As for an answer, I do borrow money to make money and it has paid off very well for me. Yes there are risk involved thats why I do it in a small scale not in a large scale venture.

The numbers posted above are also a gross amount. After all cost are exttracted I will net around 3%.(net profit each time I turn it)

However if I do not borrow the money it will be a dead cost to operate my business. by using my own capital it becomes money lost until profit returns. So by by borrowing an extra 50k to add to operating capital it would equate to total earnings. minus the 8%apr.

My business had been around for 30 years and is very strong right now. So the risk is not that high.

 

 

Hey, burnedgt500, I wasn't trying to knock you or imply your business isn't good or or low risk or anything like that. It sounds like you've been successful and, as with most successful entrepreneurs, it appears the use of borrowed money or outside equity is a critical component.

 

My point was simply ( a ) choices in front of one individual are different from those in front of another. We all chose from our available alternatives and we all have different assessments of risk even when facing the exact same alternatives, and ( b ) even when looking at ones own choices, the ability to scale and replicate are important to the decision process...in other words, we have to know how realistically we are assessing our alternatives because the alternatives available for dollar one might not be available for dollar two.

 

At the end of the day, that means there is no "pat" answer with respect to whether one should pay cash or borrow the money. It's different for different folks.

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Hey, burnedgt500, I wasn't trying to knock you or imply your business isn't good or or low risk or anything like that. It sounds like you've been successful and, as with most successful entrepreneurs, it appears the use of borrowed money or outside equity is a critical component.

 

My point was simply ( a ) choices in front of one individual are different from those in front of another. We all chose from our available alternatives and we all have different assessments of risk even when facing the exact same alternatives, and ( b ) even when looking at ones own choices, the ability to scale and replicate are important to the decision process...in other words, we have to know how realistically we are assessing our alternatives because the alternatives available for dollar one might not be available for dollar two.

 

At the end of the day, that means there is no "pat" answer with respect to whether one should pay cash or borrow the money. It's different for different folks.

 

+1

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