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first auto-loan -- what is best way to finance?

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Sk323i
Regular Contributor

first auto-loan -- what is best way to finance?

I dont have a reliable car and want to make an investment into a new car. 

 

I'm looking at a Toyota Tacoma Off-Road with some upgrade fors about 40K

 

I'm thinking about putting down $5000 and financing the rest.

 

I just bought a house 2 weeks ago.

 

My score is now 690.

 

What is the best way to finance the new auto-loan? Through the dealer? Easy creditor like Cap One?

 

Through US bank -- where I am not currently a member -- but US bank will also be the bank that will service my loan starting next month.

 

Through a local Arizona Credit Union?

 

Through a Federal Credit Union - anyone know one that might also be in Arizona?

 

A international bank like HSBC or ING where funds may be safer long term, away from risks associated with US institutions. 

 

I'm only 27 - so looking for a reliable institution that can handle my auto, home, commercial business financing needs over the next 70+ years.

 

 

 

 

525 score as of 9/2015 --- only way to go is up!
3 REPLIES 3
StartingOver10
Moderator Emerita

Re: first auto-loan -- what is best way to finance?

The best advice I ever received was "Don't put all your eggs into one basket".  This is especially true with financial institutions. Have several lenders that you work with for various types of services.  Why?  Because you want to protect yourself if some financial difficulty comes down the pike. At 27, you are likely to go through several recessions or economic hardships (this is normal) during your lifetime and the first thing that banks and CU's do is tighten up their existing credit lines to their own consumers.

 

My personal preferences follow (others may have different ideas):

  • Use non-bank mortgage originators for mortgages. They usually sell your loan servicing to a bank to service at some point soon after closing.
  • Use CU's for auto loans, credit cards, and some accounts
  • Use big box banks for checking and savings - but have back ups elsewhere

Remember all financial institutions have their own version of cross-collateralization so if you have your financial deposit accounts in one CU and you have a loan at that same CU and you default on the loan, the CU can tap the deposit account for payment without going through the court process. It is in their terms and conditions.This is SOP - so plan your finances accordingly. 

 

As to getting a reliable vehicle:  have you done a cash flow analysis with your new house payment yet?  How much vehicle (payment) can you afford with the new housing payment and not negatively affect your savings?  

Message 2 of 4
Anonymous
Not applicable

Re: first auto-loan -- what is best way to finance?

I'm with Starting Over
Young ppl have been SOLD a bill of goods on SIMPLYING things by having ONE place for everything.

Get a combo meal don't FRET about thinking things out, running the numbers, that's too much WORK and all that trouble...
Just let the one biggo place handle everything and ya'll jus sit back n play yer self some video games and drink some flavored coffee, while THEY handle all that stuff conveniently....Details metails friend everything will be jus Fiiinnnne
Till it isn't

As mentioned, shopping is in order and spreading the love is a must...
Too many institutions want to get to deeply involved in too much of our lives today.

Example
CK offers the Free report, with alerts and all...OK fine
Now, they offer Free Tax Prep!

So now every stitch of your finances on display and cross sell to every CK advertisor?

So the credit vendors may as well just fill out the apps FOR you, they have EVERYTHING at that point, just don't like it.

Heck, married ppl sometimes aren't THAT open to share 😊
Message 3 of 4
Anonymous
Not applicable

Re: first auto-loan -- what is best way to finance?

Credit unions in general offer great financing for auto loans and low fees for banking.  NFCU and Penfed are both excellent ways to go to establish a good auto loan and banking relationship.  We use NFCU and even though there isnt a branch within 100 miles of where we live its not been an issue and the customer service is excellent.  

Message 4 of 4
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