Question about financing with new rates

[darrink]

Looks like the finance rates from 22 are toast for me since my order just went to a 23. My plan was a large down payment and 0% for 36. I don't plan on getting penalized with a 5% or higher interest rate just because they need a year and half to build me a car. I've never bought a new car so looking for advice on the best way to deal with the finance department. I'm apprehensive that I'll get into some long debate if I say I want to buy the car outright. Or even worse, that they'll tell me take it or leave it with financing. So can I just agree with whatever the rate is, drive the car off the lot and send them a check for the balance? Is there a penalty for early payment of the loan? Thanks.

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[jsus]

You're getting way far ahead of yourself.

If it comes down to such an ultimatum, just read the finance agreement they put in front of you. If there's an early payment penalty, if the loan requires all the interest that would've been paid, to still be paid, even if paid off early, it'll spell that out.

A reputable lender such as Ford Credit will typically have no such provision.

 

[gte105u]

Don't talk financing until the OTD price is agreed upon. Same for trade in if applicable. If they are doing their own financing (which is what they usually push if they get pushy) there's no telling the terms for early payment penalty. Typically for financing through Ford there isn't one that I recall.

 

[commadorebob]

You finance what you owe. The less you owe compared to the value combined with the duration of the loan will dictate your finance rates (in addition to your credit history). I too plan to make a large payment upon delivery. Your best bet is to go to a credit union or your bank with the loan terms. Making a large payment mean your loan-to-value ratio will be low enough a credit union will bite. That way you don't even need to bother with the dealer's finance office.

Even including right after my personal bankruptcy 12+ years ago when I as assaulted by the Great Recession, I have never had a loan with a prepayment penalty. In fact, the law governing prepayment penalties is so strict, most banks will simply just deny the loan rather than deal with any consumer who might otherwise have required a prepayment penalty to begin with.

 

[Maverickblues]

Aren't you supposed to receive a private offer from Ford? That is supposed to cover price increase as well as additional finance cost, but some credit unions have rates lower than the best they will offer you. The rates from early 2022 or before are long gone if it's a 23'

 

[GonnaGetItOneDay]

Aren't you supposed to receive a private offer from Ford? That is supposed to cover price increase as well as additional finance cost, but some credit unions have rates lower than the best they will offer you. The rates from early 2022 or before are long gone if it's a 23'

The private offer might make up the difference in the financing rates if you have a basic XL hybrid but anything more than that and you will still end up paying more in interest over the long term.

I did the math for my situation and the private offer will lower the price of my 23 by almost $500 than what my 22 was priced at, but the Ford financing rates will raise by 2-4%. When I did the math on a 2% interest rate increase (1.9% to 3.9%) I would end up paying over 1k more in interest over the life of the loan.

 

[Fancy Farm]

Interest is going up. You will ride the wave like everyone else. No one likes it but it is a fact so just deal with it. 0 interest spoiled a lot of peope me included. It is over move on.

 

[skadizzle]

Aren't you supposed to receive a private offer from Ford? That is supposed to cover price increase as well as additional finance cost, but some credit unions have rates lower than the best they will offer you. The rates from early 2022 or before are long gone if it's a 23'

The private offer for me doesn't even cover the price increase, let alone the finance rates. I'm going to pay about $800 more for the car itself and another $1,500 in interest. FORD

 

[CTYankee]

Maybe this will help you ask the right questions of the dealer or lending institution:

Prepayment Penalty On Car Loans: Do I Have To Pay Them?- RateGenius

 

[RLader]

Once you get the deal that shows the total amount they will finance. Give them a check for that amount. They won't like it but there is nothing they can do about it.

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