Ford's Flex Buy Program, what's the major disadvantages ?

[fwashjr]

Hello all - I know this is off topic so forgive me for this I was wondering if you guys like the idea of Ford's Flex Buy program or not really. I'm the guy that can't stay in a vehicle more than 3 years so the lower payments at the beginning of the term seem tempting could ya all chime in and let me know what you think? there must be some MAJOR disadvantages to it right?

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[Darnon]

You're effectively deferring 15-18% of what would be payment to principal to the back of the loan. So if you can get it with a really good interest rate (<2-3%) then it's okay. At the 5%+ that's more typical now maybe not so much. Because you're paying less to principal then it also increases the risk of becoming underwater more unless you put down a good-sized down payment.

If, as you say you are, the sort to trade in frequently after only a few years then you're much more gambling that slower payoff against the depreciation. Mavericks have mostly done okay on the depreciation front, but that doesn't mean you're immune to something that could significantly affect the value like a major accident or outright totaling event. GAP could offset that, but then you're increasing the cost you were trying to avoid in the first place.

Honestly, you're probably better off with a traditional loan or leasing (although Ford generally doesn't lease particularly attractively).

It was a much more attractive option when there were the promo rates like 1.9% available, or if you're in certain circumstances where you're guaranteed an income boost to compensate for the payment hike in the back half of carrying the loan in full.

 

[fwashjr]

You're effectively deferring 15-18% of what would be payment to principal to the back of the loan. So if you can get it with a really good interest rate (<2-3%) then it's okay. At the 5%+ that's more typical now maybe not so much. Because you're paying less to principal then it also increases the risk of becoming underwater more unless you put down a good-sized down payment.

If, as you say you are, the sort to trade in frequently after only a few years then you're much more gambling that slower payoff against the depreciation. Mavericks have mostly done okay on the depreciation front, but that doesn't mean you're immune to something that could significantly affect the value like a major accident or outright totaling event. GAP could offset that, but then you're increasing the cost you were trying to avoid in the first place.

Honestly, you're probably better off with a traditional loan or leasing (although Ford generally doesn't lease particularly attractively).

It was a much more attractive option when there were the promo rates like 1.9% available, or if you're in certain circumstances where you're guaranteed an income boost to compensate for the payment hike in the back half of carrying the loan in full.

Thank you very much for this info it will be very helpful Darnon, with a credit score of 740 would that maybe qualify for the 2-3% with Ford Financing you think?

 

[L30n1d45]

Thank you very much for this info it will be very helpful Darnon, with a credit score of 740 would that maybe qualify for the 2-3% with Ford Financing you think?

the only person that could tell you that would be Ford Financing, imo.

 

[dochawk]

I believe that 680 is the score that "tends" to be the cutoff for "well qualified".

of course, you have several differen numbers from each of the agencies, so . . .

 

[colinl]

I believe that 680 is the score that "tends" to be the cutoff for "well qualified".

of course, you have several differen numbers from each of the agencies, so . . .

super prime typically is around 780, so he will likely not see the best rates available.

a traditional lease could be a good option if you stay under the mileage cap. if you don't, traditional financing. the Maverick's strong resale value helps you a lot when/if you want to trade in 3 years.

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