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On top of that, they keep wanting people to finance cars longer and longer to cover the ever increasing costs while keeping monthly payments the same. We are u

by syshum 5y ago

On top of that, they keep wanting people to finance cars longer and longer to cover the ever increasing costs while keeping monthly payments the same. We are upto some finance offering 84 mo;s now for a new car purchase, 7 years Image buying a car today, still making payments on it 5 years from now, and many of the core features stop working because cell network drops support

overgard 5y ago
The thing is though, afaik there isn't really any penalty for repaying the loan early. Like I have a 72mo on my car, although I expect it to be resolved long before then. I was originally going to do a 60mo but the finance guy was basically like, the longer loan gives you way more financial flexibility with very little downside.. so yeah.
- syshum 5y ago
  Depends on the type of Auto Loan you get, if you have good credit then that is largely true, but there are auto loans that "Add On" the full interest at the start of the loan, so there is no prepayment advantage, rarer but still around are also loans that front load the interest, meaning 100% of your payments are paying the interest first until the full interest is paid off, only then do you start to pay the principle >> the longer loan gives you way more financial flexibility with very little downside.. so yeah. Yea if there is no prepayment mentalities, it make sense to get the longest loan you can as long as they are not massively increasing the rate with length. never know when something else in your life (job loss, medical, etc) may make it necessary to have that lower payment.
FireBeyond 5y ago
Haha. Not even. When I bought my car three months ago, the dealer said (and thought it was as insane as I did) that they had multiple lenders who would write 96 and 108 month loans.
- HWR_14 5y ago
  If you are buying a car and you require 96 months of financing, that's a problem. If you can afford it and the interest rate is low enough why wouldn't you borrow the money?
_fat_santa 5y ago
There was a Reddit thread the other day, apparently a guy financed a Tacoma for 84mo with a payment of like $1002/mo.

by syshum 5y ago

overgard 5y ago

The thing is though, afaik there isn't really any penalty for repaying the loan early. Like I have a 72mo on my car, although I expect it to be resolved long before then. I was originally going to do a 60mo but the finance guy was basically like, the longer loan gives you way more financial flexibility with very little downside.. so yeah.

syshum 5y ago
Depends on the type of Auto Loan you get, if you have good credit then that is largely true, but there are auto loans that "Add On" the full interest at the start of the loan, so there is no prepayment advantage, rarer but still around are also loans that front load the interest, meaning 100% of your payments are paying the interest first until the full interest is paid off, only then do you start to pay the principle >> the longer loan gives you way more financial flexibility with very little downside.. so yeah. Yea if there is no prepayment mentalities, it make sense to get the longest loan you can as long as they are not massively increasing the rate with length. never know when something else in your life (job loss, medical, etc) may make it necessary to have that lower payment.

FireBeyond 5y ago

Haha. Not even. When I bought my car three months ago, the dealer said (and thought it was as insane as I did) that they had multiple lenders who would write 96 and 108 month loans.

HWR_14 5y ago
If you are buying a car and you require 96 months of financing, that's a problem. If you can afford it and the interest rate is low enough why wouldn't you borrow the money?

_fat_santa 5y ago

There was a Reddit thread the other day, apparently a guy financed a Tacoma for 84mo with a payment of like $1002/mo.