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When its time to go into the finance office

kahmyah
Valued Member

When its time to go into the finance office

I have been shopping around for a car loan and manage to secure financing through cap one. I look at this as a last resort sort of thing..I can take it for now and refinance it later if everything else is not working in my favor (in terms of finding a better APR or rate). anyway, when I will go into the finance office I am sure they will say hey we can get you a better rate. obviously it would be in ones best interest to at least listen and try. my question(s) are this. if they run another credit report, that would count as a hit against me since cap one already did this when they approved me for financing. one of my scores went down a point due to this. do you think it would be best if I just went in with my scores from here to show it. also, I am sure they are going to try and sell me some "extra stuff" for the car, like rust proofing, you know stuff like that. in your opinion what stuff should I consider and what should I say no thanks to since I am sure they will be looking to make more money off of me. any suggestions is greatly appreciated.. Tu - 676, Experian 681, Equifax 676.. APR I got from Cap One, it sucked 9.34 fro 72 months but the plan is to pay extra each month on the car and have it paid off in 60-66 mos..
Message 1 of 5
4 REPLIES 4
1111mel
Valued Contributor

Re: When its time to go into the finance office

You can app to as many people as you want within 14 days for the same type of loan and have it only count as one inquiry.
 
Buy NOTHING extra.  Check with you Insurance carrier to see if they offer GAP Insurance (you MUST have this)  As long as your insurance carrier offers GAP insurance with no limit then it will be cheaper to buy through them (My last car it would have cost me $600 dollors for 72 months, thru my Insurance it is $11 for every 6 months)
 
An extended warranty can always be purchased at the end of the Factory Warranty so you do not want to finance that.  Rustproofing, paint protectant, desert packages, winter packages etc. are all put on at the factory not added once the car is received at the dealership (but they they tell you it is).  They always talk by saying for only $11 more you get xyz, but that is $11 per monthly payment and not worth it.
 
Good Luck!
Mortgage Lenders Mid-Score 778 I AM A HOMEOWNER!!!!! 30 Year 5% Fixed Rate, closed on 3/18/09
Message 2 of 5
ivyalmighty
Valued Contributor

Re: When its time to go into the finance office

ALWAYS buy GAP insurance. NEVER buy GAP insurance from the dealership.
I know NFCU offers it if you finance through them. Check w/ your bank or CU and see if you can get pre-approved through them, and see if they offer GAP. It will be at a MUCH (as in, $500 or more) lower rate than you would get through the dealership.
Message 3 of 5
Schoolbuskid
Valued Contributor

Re: When its time to go into the finance office

With those scores i think a CU would be your best option as far as getting a better rate and possibly a larger loan! CU's are the best!
Rebuilding and Reducing Debt, is my game plan.
Message 4 of 5
CreditMizer
New Contributor

Re: When its time to go into the finance office

Don't ALWAYS* get GAP insurance.

If you are putting 10% down and/or trading in another vehicle already paid off and/or buying for substantially less than MSRP and/or have short term loan (36-58mo) at very low APR it is possible that the value of car will always be more than the loan balance. In that case GAP insurance is worthless.

Remember insurance companies pay approx the "used dealer retail price of the vehicle" since this would be the "replacement value". You can get a pretty good idea of the insurance payout in a total loss by looking it up on Edmund's and/or KBB. If your loan balance at the beginning will be = dealer used retail it likely will always be (due to slope of amortization vs depreciation).

However since most consumers:
1) Buy with negative equity from previous bad car purchase.
2) Put no or minimal $$$ down.
3) Have no idea the "value" or car and pay whatever salesman asks.
4) Finance for 60,66,72,84 months at higher APR for "lower payments".

then it does make sense to buy GAP insurance. Of course doing #1-#5 is bad for so many reasons other than GAP insurance which in long run costs consumers much much much more $$$ but that is another story. NEVER buy it from dealer. Dealer markup is pretty close to 100%.
Message 5 of 5
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