topic Re: New vs used in Auto Loans

New vs used

hoppermech — Sun, 15 Jan 2012 17:06:48 GMT

Am looking at newer trucks, the wife and I are finally going to stop buying used with high mileage to save a buck because in the long run they have only cost us so much more in repairs. I have been searching on auto trader and running the numbers here in my fico on Suzi Ormans don't get swindled calculator. Currently with my score I realize there will be a relatively higher interest rate. my concern is when buying new I now you can extend payments out 60 months there by lowering my payment. on used most will only give 36 mos loans and intrest rate is higher. I have heard that on vehicles less than two years old that you can still get 60 mos financing. is this true at all. for us monthly payment amount is more important than length of loan. any suggestions?

Re: New vs used

Revelate — Sun, 15 Jan 2012 18:34:35 GMT

This is dependant on so many factors.

The short answer is this: yes you can get a 5 year (60 month) note on a used car, especially if it's within the first couple years though the "grace period" is somewhat arbitrary by individual lender. Heck some (Roadloans) writes 72 month notes on very used vehicles. You can get the financing you're looking for from somewhere, just as you alluded to, APR is going to be non-trivial at your (and my) respective FICO scores.

With the wealth of options you're considering, I'd highly recommend that you settle on an individual make / model type, and then start looking at their relative depreciation values. Not all cars depreciate at the same rate, some vis a vis honda / toyota / their upscale siblings, tend to have a different depreciation curve than some of the other manufacturers, though this is start to change on a more broad basis: the fact is nearly most cars with reasonable maintenance can get up to 200k miles now, and if you buy new, you're in control of your own destiny.

In my case I went slightly used (2 year 33k miles), cut 20% off the OTD price and 33% off the financing amount, and received a 60 month note. It can work out in individual scenarios, just figure out what you're looking for, what you can accomodate in terms of payment, and go for it.

Re: New vs used

pizzadude — Sun, 15 Jan 2012 20:51:01 GMT

There are many lenders who will offer 60 or 72 month financing for used cars that are a few years old. I would recommend looking at 2 or 3 year old cars with lower mileage, that would save you a good chunk o change on the purchase price.

Re: New vs used

CS800 — Sun, 15 Jan 2012 20:55:15 GMT

pizzadude wrote:
There are many lenders who will offer 60 or 72 month financing for used cars that are a few years old. I would recommend looking at 2 or 3 year old cars with lower mileage, that would save you a good chunk o change on the purchase price.

Very true.

Re: New vs used

hoppermech — Sun, 15 Jan 2012 21:22:51 GMT

Thank you very much for the advice, people. As always great advice.

Re: New vs used

teenastie — Mon, 16 Jan 2012 02:13:41 GMT

CS800 wrote:
pizzadude wrote:
There are many lenders who will offer 60 or 72 month financing for used cars that are a few years old. I would recommend looking at 2 or 3 year old cars with lower mileage, that would save you a good chunk o change on the purchase price.
Very true.

Just so you know what you are looking for the average person drives 1,000 miles a month= 12k per year. a 2-3 year old car will have 24k-36k miles respectively. Anything higher I would recommend looking elsewhere or negotiate a lower price.

Re: New vs used

webhopper — Thu, 19 Jan 2012 11:05:44 GMT

Maybe a certified used? There are vehicles out there with less than 20k miles which you can get for 60% of the price of a new model. Certified cars and trucks still come with a warranty and you can finance 60 months on them. My best vehicles were purchased this way. Ford motor credit will give loans to people with your scores at 19% apr. My dealership of choice sells ford, mercury, Volvo, and Lincoln, which it is the only dealership I've ever actually trusted to give me the
Straight deal without trying to cheat, hide numbers or play the waiting game to frustrate you, they told me ford looks at it like, you have to have a vehicle to go to work in, so they will approve you, even with a high rate.