Re: I Can Help, I Run A Car Dealership
02-20-2012 12:32 PM
Sometimes it does depending where you live. A friend of a friend has the same position as you in a Mercedes dealership out here (Los Angeles, in one of the upscale neighborhoods), and they have various B-D list celeberties coming through all the time throwing cash at vehicles... the same can't be said for the random Honda dealership in the suburbs.
Webhopper: I'm going to catch some flak for this one, but also consider financing the car, and then writing the check to the lender and you may be out less money. That said, relationship building with a dealer is a two-way street, there are certain expectations you're going to have to meet to keep your end of the bargain and this might not be it.
That said if I were you, think I'd absolutely finance the vehicle depending on the rate you're getting vs. what cash / financing requirements you have to continue pushing your real-estate investing forward if you're still planning on continuing to building your portfolio there. Rates are ridiculously low now and may not be again for decades depending which way the economy goes.
Actually, if I were you again, if I didn't have an immediate investment opportunity, I think I'd take it one step further knowing what I do now: get the financing, and just make way more than the minimum payments if the lender counts them towards future payments. Knock the principal down quickly and let the tradeline idle, getting most of the FICO benefits to having a mid-term seasoned tradeline, and also not costing much out of pocket in interest charges. YMMV by lender but most simple-interest installment loans I'm seeing seem to do this by default.
Depending what my income is come April 1st, I may just keep the 19.35% Wells Fargo DS loan that I have, and just continue throwing my free cash flow towards crushing the balance as I could pay it off in under a year if I so chose at my current rate, and then just do what I suggested in the preceding paragraph without going through the hassle of re-financing games in my case.
Thats actually good advice Revelate. I often encourage customers to finance to help them get a better deal. Letting the dealer finance your loan sweetens the pot a little. Gives the dealer a reason to reach a little deaper on the price to make the deal. Then just pay it off once you receive the first invoice.
Scores: Equ Fico 715 ~ Exp 724 ~ TU Fico 682