Financing Issue(s) getting financed?

[timswi]

Wow!!! This has kinda kinda turned into a personal finance/micro-economic disussion. Anyway, the OP had a foreclosure--Massive risk to the finance company and the fact that they wanted additional assets to secure the loan is no issue in my world. In fact, he's lucky they even considered it--Would any of you given the risk of "farm equipment" kinda just dissapearing?...Keep in mind that most contracts have a "call" option but it is rarely enforced on consumers..If it was, they would have called in his existing loan and the flatbed would have arrived in his driveway.

What I said about car financing: I stand behind...Cash will generally cost more unless the dealer wants the car off his lot--aint happenin without some level of profit from somewhere andmost of it comes from dealer reserves and add-on's...

Credit card are lethal if one doesn't have a full understanding of what they are doing..If you do, good for you.

All I can say is that this is a good discussion.

 

[ovrszd]

It's a very good discussion. Steve has added some very readable data.

I agree about the lethal effect of CCs. I stand behind what I said about the vast majority of our society not being able to play Russian Roulette in that regard.

No one would get any sort of cash back from their CCs if the financiers weren't making a killing on those that lose at the "scam".

 

[hystyk24]

Wow!!! This has kinda kinda turned into a personal finance/micro-economic disussion. Anyway, the OP had a foreclosure--Massive risk to the finance company and the fact that they wanted additional assets to secure the loan is no issue in my world. In fact, he's lucky they even considered it--Would any of you given the risk of "farm equipment" kinda just dissapearing?...Keep in mind that most contracts have a "call" option but it is rarely enforced on consumers..If it was, they would have called in his existing loan and the flatbed would have arrived in his driveway.

What I said about car financing: I stand behind...Cash will generally cost more unless the dealer wants the car off his lot--aint happenin without some level of profit from somewhere andmost of it comes from dealer reserves and add-on's...

Credit card are lethal if one doesn't have a full understanding of what they are doing..If you do, good for you.

All I can say is that this is a good discussion.

You clearly didn't read much of the thread or understand the structure of the proposed deal... I posed a very simple question. What would be the downside of the deal? The bottom line: if you can't articulate the downside for Kabota, then its just talking... In 17 pages one fellow made a good point that the actual loan officer could have a downside should the loan go bad. That was the downside. The point of the thread, and substantiated by the lack of a single person showing a downside, was the new loan left them in a much better position then the current loan that would be left in place. The payment was cut in half, the balance of the loan was less then the current one and the value of collateral increased by $2500. It's just that simple and the only point I was making. Actually, I was looking for other finance stories that make people shake their head, only posted my experience because all the posts were asking for the details...

I agree it is a good discussion on financing...

 

[hystyk24]

Good stuff. Did you inquire about cash discount or did the dealers offer that information?

I prompted him by asking if the reduced price was the best he could do? He asked if I was financing? Then offered another $400 off and another 2.5 % if I wrote a check instead of using a CC. So, $4100 for not financing or $4000 for not using a CC. A perfect example of a seller giving a cash incentive but remember, they don't make anything on the 0% financing other then a $50 fee and maybe forced insurance policy. On my end it's just a simple financial decision. The 4K transaction is worth $80 if I redeem it on travel expenses or $40 if I redeem the miles for cash...

 

[paulfun9]

Wow!!!
What I said about car financing: I stand behind...Cash will generally cost more unless the dealer wants the car off his lot--aint happenin without some level of profit from somewhere andmost of it comes from dealer reserves and add-on's...


All I can say is that this is a good discussion.

You will have a very hard time convincing me of this based on my personal experience. I have had to order and wait for delivery and still got better a better price with cash than any credit offer that was put on the table. I have also gotten better deals than anything the dealership has offered when I walked into the showroom and told them "I am pre approved from my bank at --%, have this much in my pocket and will be paying my bank $--- per month for --months. Make the car/truck fit and I will drive it home!"

Never let them even run my credit anymore as its just a waste of time and when I talk with others who recently purchased the same car/truck/motorcycle or boat so far I haven't found anyone who has done better with finance. Now admittedly I haven't talked to everyone but when you compare more common things like my Ram 3500 or motorcycle that you can get a lot of conversations started on it seems I always get the "How the ______ did you pull that off.

All deals get better when they need to move something and I have also purchased at this point in time and still did better with cash than credit. So what this leads me to believe is just as I said before most are not strong enough to know when to walk away and actually do it. If they don't deal on cash the next dealer down the road will and after telling them that I have been stopped at the door, in the parking lot and called on the phone before I could even get to the next place with a much better offer. Yes sometimes it takes time and I once spent many hours working a deal but the thousands I saved added up to way more than the few hours I spent working it.

 

[Tractor Seabee]

I found tractors are a whole different animal with financing. They are not a registered/licensed item like cars, trucks, and motor cycles. Very difficult to repossess, if you can find it. The Big manufactures offering the 0 down, 0 % financing has changed the whole dynamic. It does not apply to used so most folks, that are not active farmers have to use unsecured personal loans. My hired hand just tried to buy a used pickup and the dealer would not sell for cash at all and take it or leave it price. 29% finance rate only. They are one of those dealers that finance their own deals and this guy concentrates on people who cannot get financing such as low income government workers and junior military. He also owns his own wrecker for repos; probably keeps it ready to run every day. He pushes a lot of cars. My worker and had a good laugh on that one. Today we went to a used truck dealer where I know a salesman. They wanted $3600 cash for an old pickup. checked the blue book and it was $1800 average dealer price. The offered $1800. They haggled back and forth, we made final offer 2K. Started to leave and were in my car and the sales manager came running ; said stop you got your price lets write it up. He drove it home 10 minutes later.

Last 8 vehicle deals I have made have all been for cash and at my price. I have walked out of several dealerships in the process. Last 3 were for new cars. Cash still works.

Ron

 

[ultrarunner]

Bought well over 80 vehicles and only for cash...

Never have financed anything other than a first mortgage...

My Grandparents and Dad were products of the Depression where it as all hands on deck... even Dad at 9 was contributing having a paper route...

My Grandmother never approved of loans saying so many got in over their heads and lost it all and then pointed to the homes in the neighborhood lost to foreclosure.

Mr Grandfather had two old weathered signs about his desk...

One is "Prosperity is earning a dollar and needing only 99 cents..." and the other is if "You're so **** smart why aren't you rich..." both from the Depression Era...

 

[mile9c1]

Ultrarunner I like how you think. How about, "A penny saved is 1.5 pennies earned"?

 

[fried1765]

You will have a very hard time convincing me of this based on my personal experience. I have had to order and wait for delivery and still got better a better price with cash than any credit offer that was put on the table. I have also gotten better deals than anything the dealership has offered when I walked into the showroom and told them "I am pre approved from my bank at --%, have this much in my pocket and will be paying my bank $--- per month for --months. Make the car/truck fit and I will drive it home!"

Never let them even run my credit anymore as its just a waste of time and when I talk with others who recently purchased the same car/truck/motorcycle or boat so far I haven't found anyone who has done better with finance. Now admittedly I haven't talked to everyone but when you compare more common things like my Ram 3500 or motorcycle that you can get a lot of conversations started on it seems I always get the "How the ______ did you pull that off.

All deals get better when they need to move something and I have also purchased at this point in time and still did better with cash than credit. So what this leads me to believe is just as I said before most are not strong enough to know when to walk away and actually do it. If they don't deal on cash the next dealer down the road will and after telling them that I have been stopped at the door, in the parking lot and called on the phone before I could even get to the next place with a much better offer. Yes sometimes it takes time and I once spent many hours working a deal but the thousands I saved added up to way more than the few hours I spent working it.

paulfun9....I don't know your age, but I am 76, and have bought cars/tractors/furniture with only cash for many years.
I have walked away several times also. Had a dealer call me next day once, and say OK to the deal we had discussed, my response: Sorry, I bought from a different dealer already.

I charge all other expenses on my 3 credit cards:

A Visa that gives me 5% back on gas, groceries, drugs ($400 yearly max cash back)
A VISA that gives me $2% back on everything (card costs $59 per year) with no cash back limit.
A M/C that gives me 3% at Office Depot, Lowe's, Home Depot, & hardware stores.

I charge EVERYTHING that I can!
From these 3 cards I get more that $1,000 back each year.
I love 'em !!!
Of course I pay the balance due every month.

 

[ultrarunner]

Wish I could take credit but it was my upbringing... my folks and grandparents never bought a new car...

Just prior to Dad passing he said make sure Mom gets her car to replace her 25 year old VW... she liked her VW but no power steering, radio, manual transmission, no A/C... etc she said now being older she could appreciate some of these luxuries properly... especially power steering for parking!

This is when we did a factory order for her 2001 Corolla S and watched it being built... and she paid cash for it...

My grandfather had another sign I found when I was cleaning up things... it was a gift from a friend when he married... I guess signs were popular back in the 1920-40's?

This one show a papa bird dangling a worm over a nest with open mouth chicks... the caption said "In the Spring I was an *** to get married"

 

[paulfun9]

paulfun9....I don't know your age, but I am 76, and have bought cars/tractors/furniture with only cash for many years.
I have walked away several times also. Had a dealer call me next day once, and say OK to the deal we had discussed, my response: Sorry, I bought from a different dealer already.

I charge all other expenses on my 3 credit cards:

A Visa that gives me 5% back on gas, groceries, drugs ($400 yearly max cash back)
A VISA that gives me $2% back on everything (card costs $59 per year) with no cash back limit.
A M/C that gives me 3% at Office Depot, Lowe's, Home Depot, & hardware stores.

I charge EVERYTHING that I can!
From these 3 cards I get more that $1,000 back each year.
I love 'em !!!
Of course I pay the balance due every month.

You need to go back and read my last post to understand my position on different purchases. I do use credit cards when they can benefit me but simply don't normally shop most of those places. I even pay some bills with them as I would be writing a check out every month for the same amount anyway. Also it saves on the cost of checks and for some, like my last bank who wanted to charge you for a statement each month you get a record of your exact spending along with the card bill.

 

[Steppenwolfe]

The very first Kubota I bought was in 1986, December to be exact. It was an L2650, I think, 4wd, with fel and backhoe. So, I was outside looking at it and up walks the dealer, " How much?" I asked, and off he goes back inside. A minute later he comes out and says $19,500. I thought for a second and said " How much if I buy it today? " Off he goes back inside and comes back out and says, $17,500. I said, " OK, how much if I buy it NOW, this minute, cash?" Again, he runs back in, runs back out and says $14,000. I said " Sold...." Cash will always be King...

 

[ultrarunner]

^^^I will try this on my next purchase...

The last Kubota purchase was the L3800...

I have since looked at the RTV but ended up not buying... Dealer had none to show and the ones that just came in were all sold... said simply didn't have any for immediate delivery and did not know when they would.

 

[Steppenwolfe]

^^^I will try this on my next purchase...

The last Kubota purchase was the L3800...

I have since looked at the RTV but ended up not buying... Dealer had none to show and the ones that just came in were all sold... said simply didn't have any for immediate delivery and did not know when they would.

When I bought my mini ex it was the same story, no one could keep one on the lot. I would call to check availability and get, " Well, we have it sold." I decided to visit a local dealer who I really didn't like working with and found he had 3 sitting on the lot, various sizes. It was the week of Thanksgiving, and I used the same method as above. Told him I only wanted one price from him, and that I would write a check that minute if it was the right price. I even had my wife take the check book out of her purse so he could see it as he calculated the amount... Closed the deal in five minutes.

 

[ultrarunner]

An informed buyer ready to commit on in stock inventory is a lot of incentive to not screw up the sale..

Tire kickers come and go.

I still remember the sales manager and this one guy that came in every Saturday and left after an hour and half... for months...

One Saturday the guys said they were going to see if he was all talk... they told him today only by 5 pm they could sell the car 30% off... but it had to be today... they guy said he was going home to get his wife and checkbook... never did show...

Monday, he comes in with his check book and the car was gone... don't know if they really would have delivered but said they would.

We always appreciated a buyer that had a go and no go price... it reduced time wasted and really was reduced to a simple yes or no.

By the way that customer called other Dealers to see if they had a 30% off special... because one called to see what was going on and this was before the Internet...

 

[LD1]

We always appreciated a buyer that had a go and no go price... it reduced time wasted and really was reduced to a simple yes or no.

I have been to a few dealers that DONT appreciate that.

This was back in 2006 or 2007, before we were debt free, and we were buying a truck for the wife. The truck was a 2005 Ram 1500 quad cab with the off-road package. Sharp truck and ~50k miles on it.

They had it on the lot for 22900. And we were pre-approved through our bank at 5.99%.

Since we were gonna finance, the selling price of the vehicle was really an irrelevant number to me. Only thing that mattered was how much am I paying per month, and for how long. Because that is my "real" cost of the truck. And that gives them a little more wiggle room and incentive to get us a good interest rate as well.

After we test drove, my request was simple. Put me in that truck for $400/month for 60 months and we will drive it off the lot now. I told them its yes or no, and do not come back with different numbers. Either you can do the deal, or you cant.

The "salesman" was a friend of mine, but at this dealer, they dont handle finances. The salesman answers any questions, arranges test drives, etc. But once negotiations start, it gets turned over to their finance dept.

Well, we were sitting at the desk and finance guy comes out. He says "great news", and shows me a paper. Says we can put you in that truck for $376 per month for 72 months. I said "dont you listen. I told you $400/60months, I have no interest in financing 72 months. HE said "oh" give me just a second. Came back and said $409 for 60 months is the best we can do. I said ok and got up and me and the were walking out the door.

I herd him ask as we were walking away "are you really gonna walk out over $9 a month?" I turned around and said "I dont like games. Are you really willing to loose a sale over $9 a month?" and we kept walking.

We got to our car, had it started and in reverse and my salesman buddy come over and wanted to know what was going on. I explained everything to him and he said if I can get you under $400 would you still be interested? I said nope. Gotta be under $390 now for jerking me around and you have 3 minutes and we are pulling off this lot.

He comes out about 2 minutes later and says come on back inside and sign with the finance manager here.

The finance "underling" we were dealing with the first time was pi$$ed. I told the finance manager my request was simple. And I wanted a yes or now answer and not to be jerked around. We signed and they payment ended up something like 389.87 or something like that.