Used Car Loans

[Hawkeye]

Originally Posted by se15679875

Why would a credit union give you 2%? They're hardly keeping up with inflation at that rate.

My credit union refinanced my 2016 GMC at 1.74%

[Hawkeye]

Originally Posted by EnVe46

I tend not to ask questions when I benefit but I also took the longest term they offered, 72 months, so I'm sure that has something to do with it.

Generally the longer the term the higher the interest rate... so that doesn't help your point

[EnVe46]

Originally Posted by Hawkeye

Generally the longer the term the higher the interest rate... so that doesn't help your point

Shows how much I know Hahaha Ive always carried the longest term and never had higher than 2.5%. Suncoast CU is the one I use and Ive been extremely satisfied with them. I refinanced a truck that I bought thru a dealer and they refinanced at 2%. I hustled the dealer into giving me a better deal if I used their finance, then refinanced three months later. They had me at 5.4%.

[eluded]

Pay cash.

[Hawkeye]

Originally Posted by eluded

Pay cash.

If a bank is giving an interest rate of <2%, why the hell would you pay cash? That just doesn't make sense. You can get guaranteed fixed rates over 2% right now.

[Red Bread]

Originally Posted by Hawkeye

If a bank is giving an interest rate of <2%, why the hell would you pay cash? That just doesn't make sense. You can get guaranteed fixed rates over 2% right now.

There's always a contingent that argues for cash. It's like the picture of a guy with bear arms in any gun discussion. It's just gonna happen. Not everyone is good at the monies.

[se15679875]

Originally Posted by qba335i

Revolving vs installment credit. Both have impact on your credit score. If you have over 750 it does not really matter how you achieved it as you will get the best rates.

Originally Posted by qba335i

It's a personal preference. At rates so low it makes sense to finance, especially if you earn more on your investment than you pay in finance charges.

On the other hand, some people just don't want to deal with monthly car payments so a few extra dollars is not worth it for them.

I would finance in a heartbeat if I got some of the rates people are getting in this thread.

1.74%? 2%? These rates are off from what I'm getting by nearly a factor of 2. It must just be location.

I'm looking to purchase a car for around $80,000 with the next 6 months. Financing that amount at 2% would be a game changer. I think it's reasonable for me to get a 3.5-6% CAGR in the market over a 5-ish year period (increase that range to maybe 2-8% for a 3 year period).

As of now my plan is to write a check for the car.

[StuP]

Originally Posted by Hawkeye

If a bank is giving an interest rate of <2%, why the hell would you pay cash? That just doesn't make sense. You can get guaranteed fixed rates over 2% right now.

Genuine question, who's offering fixed return rates at 2% ? I've an emergency fund I keep on short term, I'd be happy to get 2% return !

[RickFLM4]

Originally Posted by StuP

Genuine question, who's offering fixed return rates at 2% ? I've an emergency fund I keep on short term, I'd be happy to get 2% return !

FDIC money markets aren't quite to 2% (presumably what you want for liquidity) but CDs and treasury yields are over 2%.

https://www.bankrate.com/banking/mma...account-rates/
https://www.bankrate.com/cd.aspx#testid=10582932774_a
https://www.cnbc.com/2018/05/10/boe-...-in-focus.html

[se15679875]

I use University Federal Credit Union and get 0.25% on my money market account (and rarely .05% when that account exceeds $250k which generally doesn't happen as I'll transfer money over to TD ameritrade as needed)

I've heard stories of people using non-FDIC (duh) foreign banks getting astronomical returns on their money. We're talking 4-7%. Too chicken to try, though.

[qba335i]

Originally Posted by StuP

Genuine question, who's offering fixed return rates at 2% ? I've an emergency fund I keep on short term, I'd be happy to get 2% return !

Open a brokerage account and buy a Money Market fund. The returns are now close to 1.8% and should hit 2% next month when they (Fed) raise rates.

Example: FZDXX - Fidelity Premium Money Market Fund.

[Hawkeye]

Originally Posted by StuP

Genuine question, who's offering fixed return rates at 2% ? I've an emergency fund I keep on short term, I'd be happy to get 2% return !

Depends on your strategy. My CU offers 3% on my rewards checking with just a few stipulations (this is my ~30k cash fund I don't have invested)

If you have the cash to buy a car outright you are better off getting a loan (I see rates around 2.5 to 2.75% right now) and then getting a CD. 45 Month CD (at the same CU as the car loans) is 3% for up to $100k and 3.1% if over 100k.

Even the 18 months CD is at 2.4% (2.5% if over $100k)

The difference in rates doesn't make sense from a pure investment standpoint, I have to assume they can account for each of them differently and still come out ahead (no arbitrage)

What qba said is a safe bet as well, just not currently above 2%

[hooligan_G01]

Originally Posted by ShopVac

My credit union was offering 2.25% on a 48 or 60 month loan. To hit that rate, you couldn't finance more than 80% of the value and you had to have a direct payment from the account. Otherwise it was 3%

I've been noticing a trend upwards over the last couple years. In 2014 through 2016...1.5 to 1.9% was not unheard of.

I had 1.9% through Ford Credit on a used Fusion Titanium that I had briefly last year.

[Never_Enough]

Originally Posted by qba335i

Open a brokerage account and buy a Money Market fund. The returns are now close to 1.8% and should hit 2% next month when they (Fed) raise rates.

Example: FZDXX - Fidelity Premium Money Market Fund.

Can that be cashed out immediately & without penalty should an emergency arise?

If I can get more than the 1% or so I get via my savings account & just as easy, I'm in. That's my emergency fund $ so if shit happens, I still need to get to it.

[Tyresian]

Never_Enough There are a few trusted banks offering good interest rates. I've used both Ally Bank which is at 1.6% for a Fee-Free Savings Account and Capital One has their Money Market at 1.6%.

I've been really happy with Ally, switched from Capital One (Originally had ING Direct before they were bought out, had a 3.5% savings account at one time, just had very little money to put in it during college unfortunately).

Also Ally Bank will increase your savings account rate over time, it's been on a climb with interest rates rising in general. It can go down of course as well so the ride doesn't last forever. But they seem to be the most reliable and consistently good rates, plus easy to work with and decent app support.