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Discussion Starter #1
Ok so I have a car that is $43259.73 out the door.
I want to put $20K down.
Finance the rest ($23259.73) for either 36 Months or 48 Months.
They gave me the following numbers after typing it in their computer system:

6.59 interest rate.
if I do 36 months: 713.94 a month.
if I do 48 months 552.56 a month.

For some reason my math doesn't come up with the same numbers. Can someone explain how they arrived upon these numbers?
 

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Discussion Starter #2
I did it on an online calculator and it looks correct. I guess I am not doing it right because of compounding. But I would still like someone to show me the math behind it if possible.
 

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My business calculator comes out within a couple cents of what you got for payments.
 

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BringsMeWomen said:
yes, but can anyone show me the math behind it?? Any math wizes or financing people in here?
This is an internet amortization calculation I use all the time, to figure out what things should cost. Enter in your principal amount, 48 payments, 12 payments per year, etc, and your 6.59 interest rate, and it will display exactly what the dealership quoted you.

If you check the "show amortization schedule" it will print out exactly how much of each payment is going towards interest or principal.

http://ray.met.fsu.edu/~bret/amortize.html

--gos
 

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BringsMeWomen said:
Ok so I have a car that is $43259.73 out the door.
I want to put $20K down.
Finance the rest ($23259.73) for either 36 Months or 48 Months.
They gave me the following numbers after typing it in their computer system:

6.59 interest rate.
if I do 36 months: 713.94 a month.
if I do 48 months 552.56 a month.

For some reason my math doesn't come up with the same numbers. Can someone explain how they arrived upon these numbers?
If you have good credit, you should be able to get a finance rate under 6%.

A quick checks shows variable rates at 4.75% and fixed and 5.75%.

5.75% would drop your payment about $10 per month almost covering Sirius subscription although the first year is free.

Tell your dealer the rate is too high and that you can get 5.75%, I bet they match it or beat it no questions asked.
 

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Math figures

BringsMeWomen said:
Ok so I have a car that is $43259.73 out the door.
I want to put $20K down.
Finance the rest ($23259.73) for either 36 Months or 48 Months.
They gave me the following numbers after typing it in their computer system:

6.59 interest rate.
if I do 36 months: 713.94 a month.
if I do 48 months 552.56 a month.

For some reason my math doesn't come up with the same numbers. Can someone explain how they arrived upon these numbers?
=====================
I cannot do pennies. Rounded off to loan of $23,260.00.
-36 Months = $713.85.
-48 Months = $552.58.

I tried to send you the complete month by month print outs. Had to much material.:thumbup:
 

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chuck92103 said:
If you have good credit, you should be able to get a finance rate under 6%.

A quick checks shows variable rates at 4.75% and fixed and 5.75%.

5.75% would drop your payment about $10 per month almost covering Sirius subscription although the first year is free.

Tell your dealer the rate is too high and that you can get 5.75%, I bet they match it or beat it no questions asked.
Even if you can swing 6.59% -> 6.00% for your financing (try a credit union first if you belong to one, then try a bank), that'll save you a bit..

total interest = $3263 over 4 years at 6.59% ($552.57/mo)
total interest = $2960 over 4 years at 6.00% ($546.26/mo)
total interest = $2832 over 4 years at 5.75% ($543.59/mo)
total interest = $2705 over 4 years at 5.50% ($540.94/mo)

It's worth it to spend a few hours shopping for a better rate, as that'll save you a few hundred over a few years. It saves even more obviously, the more you finance.

Granted, over 3/4 years it's less of an impact as opposed to 5 years, and by putting so much down that really helps too, but either way, money is money and it all adds up in the end...

--gos
 

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If the interest rate is the same for both options and there's no prepayment penalty, you can always finance for 48 months and make the 36 month payment. I didn't finance this car, but that's what I did on my previous car. You still pay it off in 3 years and pay no more than you would have if you chose the 36 month option, but you're not locked into the higher payment.
 

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BringsMeWomen said:
Ok so I have a car that is $43259.73 out the door.
I want to put $20K down.
Finance the rest ($23259.73) for either 36 Months or 48 Months.
They gave me the following numbers after typing it in their computer system:

6.59 interest rate.
if I do 36 months: 713.94 a month.
if I do 48 months 552.56 a month.

For some reason my math doesn't come up with the same numbers. Can someone explain how they arrived upon these numbers?
================
I tried to send you the month by month break-down for the figures. I cannot get my attachment to attach to the Bimmerfest (I am not a computer type). If you want to send me your email address, I can send you the figures. (Not sure if we are allowed to do this) In any event, figures look fine to me.:dunno:
 

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gos said:
Even if you can swing 6.59% -> 6.00% for your financing (try a credit union first if you belong to one, then try a bank), that'll save you a bit..

total interest = $3263 over 4 years at 6.59% ($552.57/mo)
total interest = $2960 over 4 years at 6.00% ($546.26/mo)
total interest = $2832 over 4 years at 5.75% ($543.59/mo)
total interest = $2705 over 4 years at 5.50% ($540.94/mo)

It's worth it to spend a few hours shopping for a better rate, as that'll save you a few hundred over a few years. It saves even more obviously, the more you finance.

Granted, over 3/4 years it's less of an impact as opposed to 5 years, and by putting so much down that really helps too, but either way, money is money and it all adds up in the end...

--gos
:stupid: you are in the driver's deat with a $20k down payment. Don't let the dealer hoodwink you. You are a rare catch in any bank's mind.
 

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BringsMeWomen said:
Really? I didn't know you can negotiate on rates as well. I thought that was a rate set by the banks and are non-negotiable.
Car dealers have access to fund at lower rates than banks in some cases. Everything is negotiable.

Again, simple phone call to the dealer, don't even have to go in, tell them you will sign if they meet or beat your bank's rate. They still make money off the financing, just not as much.

Again, $20k, you are in the driver's seat.

Let us know how it goes. I guarantee you with good credit you will be well under 6%.
 

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Discussion Starter #15
chuck92103 said:
:stupid: you are in the driver's deat with a $20k down payment. Don't let the dealer hoodwink you. You are a rare catch in any bank's mind.

Well actually it is true. I checked with my credit union and they say 5.25-11% depending on credit rating and I've got a pretty good credit rating. So at what percent should I take their offer?
 

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BringsMeWomen said:
Well actually it is true. I checked with my credit union and they say 5.25-11% depending on credit rating and I've got a pretty good credit rating. So at what percent should I take their offer?
Tell them you can get 5.25% from your bank but you don't want to go through the hassle. If they can come close to that you will use them for financing, otherwise go to your bank.

Keep in mind, even if you sign with the dealer at 6.75%, you have 10 days to go to your bank and get a lower rate and then drop a cashiers check off at the dealer.
 

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I just did a search on www.bankrate.com for New York area rates.

Auto Loan Calculator


Available monthly payments for a loan amount of******** language=javascript type=text/javascript> document.write(showCalcAmount()); *********> $24,000​
<TABLE class="tableChart results" style="TEXT-ALIGN: center" cellSpacing=0 cellPadding=0 width="100%" border=0>*******><TR class=highlight><TD>Monthly Terms</TD><TD>36</TD><TD>48</TD><TD>60</TD><TD>66</TD><TD>72</TD></TR><TR><TD>APR † (Excellent) </TD><TD>5.39% </TD><TD>5.75% </TD><TD>5.75% </TD><TD>6.19% </TD><TD>6.19% </TD></TR><TR class=highlight><TH style="TEXT-ALIGN: center">Monthly Payment</TH><TH style="TEXT-ALIGN: center">$724</TH><TH style="TEXT-ALIGN: center">$561</TH><TH style="TEXT-ALIGN: center">$461</TH><TH style="TEXT-ALIGN: center">$430</TH><TH style="TEXT-ALIGN: center">$400
</TH></TR>********></TABLE>
 

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Discussion Starter #18
The finance manager called me back. They wouldn't budge at all with the rates. She said the bank gave her that number and she can't do anything about it.

I guess I will go to either my credit union or worst case scenerio, another bank to see what I can do.

Any suggestions on where?
 

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BringsMeWomen said:
The finance manager called me back. They wouldn't budge at all with the rates. She said the bank gave her that number and she can't do anything about it.

I guess I will go to either my credit union or worst case scenerio, another bank to see what I can do.

Any suggestions on where?
The dealer generally deals with many banks, not just one. But I would stick to your guns.

If you want the car now, go ahead and sign. It is only a few hundred bucks in savings.

But on monday, call your bank and see what they can do. It is a little more trouble, but they will tell you over the phone the rate they will give you and process the paperwork in a day.

You can also try www.eloan.com.

Another thing to consider, is only putting 10K down. If you can handle the higher payments. Take the other $10k, and put it in a CD or some other investment vehicle. When you car is paid off, you will have about $12-13k still in the bank. Money is cheap right now, just depends how much of a payment you want. You will find the interest earned on the $10k will almost cover the interest you paid on the loan.

http://www.sdccu.com/pages/calculators/SimpleLoan.asp
 

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chuck92103 said:
The dealer generally deals with many banks, not just one. But I would stick to your guns.

If you want the car now, go ahead and sign. It is only a few hundred bucks in savings.

But on monday, call your bank and see what they can do. It is a little more trouble, but they will tell you over the phone the rate they will give you and process the paperwork in a day.

You can also try www.eloan.com.



Another thing to consider, is only putting 10K down. If you can handle the higher payments. Take the other $10k, and put it in a CD or some other investment vehicle. When you car is paid off, you will have about $12-13k still in the bank. Money is cheap right now, just depends how much of a payment you want. You will find the interest earned on the $10k will almost cover the interest you paid on the loan.
Thanks for the tip. On a financial standpoint, you are probably right about the CD... But to tie my money up to pay for that extra few hundred dollars in interest is probably not for me. But I will definitely shop around for a better rate and go with one lower than 6.59. From what people are saying and from my credit union, it seems that getting a point lower wouldn't be out of the question.
 
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