Auto Loans

bestkeeper14

bestkeeper14

CAGiversary!
Since I am in the loan business and know most of the in's and out's of what happens behind the scenes at car dealerships, I figured this would be perfect for a finance section.

So, if you are in the market for a car feel free to ask questions here on the buying process.  Where can I get the best rate?  What are all these terms banks and dealers use?  How to get the best deal on a car? What are some good long lasting cars?

All these questions can be answered here through my personal advice and also your fellow CAGers.

How do banks and dealers calculate my interest rate?

  • Most of it is based off of your credit score and also the term of the loan.
  • However, what most people do not know is that with some auto loans, they will increase the rate you were approved for and pocket the difference.
  • Example:  I am approved for 2.99%, dealer will contract at 4.99% and pocket 2% of the loan
How to avoid that: get approved for your loan before hand!

  • This is the only way to go when getting a loan so you know your rate and the dealer does not have a chance to increase it for their benefit.
  • another thing that is taken into account can be LTV.  LTV stand s for Loan to Value.  This is the   calculation of how much the car is priced over value.  This means that the moment you drive off the lot you are upside down a certain amount.  If the car is too much upside down, lenders may charge a higher interest rate to protect them if the car ever gets totaled.  When buying a car you do not want     to pay too much over the value, obviously, so do your research with NADA values and understand that getting as close to 100% is where you want to be.  
  • You can also put money down to help LTV, and it is why some lenders or dealers require it.

What kind of products will a dealer offer?  

  • Dealers offer many different things that can make them a lot of money.  
  • Examples are Service Warranty, Gap, Maintenance, Security, Life insurance, Disability, Tire protection, and perma plate.

Should I buy these extras for my car?

  • This answer all depends on you.  Things like a warranty, gap, and even maintenance can be beneficial to you, however, it all depends on price.  
  • All extra products are negotiable on price and something that many people do not know.  
  • Also some state laws regulate these products while others do not.  For example. Colorado requires that gap does not exceed either 2% of the amount financed, or it can be a flat $300.  Honestly there should be no reason to pay more than $300 on gap as there are many third party companies you can get gap for that price even if the dealer won't do it.  Remember that everything is negotiable no matter what they say.


If anyone has anything else to bring or questions regarding an auto purchase feel free to ask.

 
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Thanks bestkeeper14. Will keep this thread in mind if I ever need a loan. I was lucky and purchased my vehicle in 2002 with 0% interest loan. I am thinking of getting something newer but can't stand the idea of a loan on a depreciating item. After reading your OP it looks like I should go to my bank for a loan before heading to the dealership. Is this the case or is better to use something like GMAC financing?
 
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Ironman8 said:
Thanks bestkeeper14. Will keep this thread in mind if I ever need a loan. I was lucky and purchased my vehicle in 2002 with 0% interest loan. I am thinking of getting something newer but can't stand the idea of a loan on a depreciating item. After reading your OP it looks like I should go to my bank for a loan before heading to the dealership. Is this the case or is better to use something like GMAC financing?
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Honestly you should go to a credit union first and get the loan. You will get the best deal overall unless you are buying completely new. If you are buying new you can get better deals from Dealers because they go through the franchise offices and can have offers like 0% interest. Most banks and credit unions will not offer that. But if you are buying used, then get the loan first. My credit union for instance does 2.49% up to 66 months for anyone with a credit score above a 740. add more term rate goes up.

 
You are spot on with everything you have written.  It is very kind of you to share this information with all of us.  I hope more people take a look at this thread and get something from it.  My brother was a car dealer for a few years and clued me in to just about everything you have mentioned here.  It is very valuable information especially for those whom are just starting out and maybe buying a car for the first time alone.  I remember hearing from my brother the fact that you can negotiate the Service Warranty, Gap, Maintenance, Security, Life insurance, Disability, Tire protection, and perma plate.  Another thing is a lot of these dealerships are popping up with these "Lowest Sticker Price, No Haggle" deals.  The price on the car might be pretty good, but they get you on all the extras, that's where you can negotiate.  You can even negotiate the interest rate.  Very cool of you to share bestkeeper14!!!

How might one know if the price the dealership is asking is actually worth it?  Is there a typical percentage or dollar amount you can expect to negotiate down on any given vehicle? New and used?

 
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ShirtSizeXXXLXT said:
You are spot on with everything you have written. It is very kind of you to share this information with all of us. I hope more people take a look at this thread and get something from it. My brother was a car dealer for a few years and clued me in to just about everything you have mentioned here. It is very valuable information especially for those whom are just starting out and maybe buying a car for the first time alone. I remember hearing from my brother the fact that you can negotiate the Service Warranty, Gap, Maintenance, Security, Life insurance, Disability, Tire protection, and perma plate. Another thing is a lot of these dealerships are popping up with these "Lowest Sticker Price, No Haggle" deals. The price on the car might be pretty good, but they get you on all the extras, that's where you can negotiate. You can even negotiate the interest rate. Very cool of you to share bestkeeper14!!!

How might one know if the price the dealership is asking is actually worth it? Is there a typical percentage or dollar amount you can expect to negotiate down on any given vehicle? New and used?
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The key is finding the NADA retail of a vehicle, then understand they have to make a little bit of money, however most dealers either buy or get a trade at NADA wholesale. My credit union bases the value of the car and how your loan to value is based on NADA retail, so the dealer should be able to get to the price or just above it.

 
Curious if it would be realistic to get a dealer to lower price of car to where they were losing a decent amount of money, but have them think they are making up for it on backend with a higher interest rate. Not sure how you would bring that desire up in negotiations, but just curious. Of course the plan would be to get loan with someone else or pay off completely soon after you drive off the lot.
 
Yea it can happen, my dad did that once... Made them think he was going to need financing and then he pulled out a check, pissed the dealer off so much they gave him the car and kicked him out
 
A good rule is not to take out a loan for a car.  Makes little sense to borrow money to purchase a depreciating asset.

 
More of a credit question but as I plan to get a car sometime next year figure I'd ask as a loan will probably have to happen. I have 3 credit cards I'm in the process of paying off - one is already paid off, the other is nearly paid off just a matter of when I decide to do it and the third has a bit to go. Once they are all paid off fully will this have any effect on my score and how long would it take to reflect that or will it not. I've always heard you should use your cards as long as you are paying on them on time as that actually helps your credit so I'm curious once I pay off these in full (none of them are sky high in debt, I have the money to do it any time I just have been paying minimum) if I should start using them again and paying on them to help my credit or does it really matter?

 
dopa345 said:
A good rule is not to take out a loan for a car. Makes little sense to borrow money to purchase a depreciating asset.
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This is terrible advice, unless you're wealthy or buying a clunker, most people are going to take out a loan for a car, and unless your credit is absolute garbage, it's unlikely you'll ever be paying more than 5% interest anyways, which is nothing. Personally, I've always found the best deals when buying new, as long as you have a couple grand to put for a down payment. You'll get far better financing options buying new, and dealers will frequently be able to get you under 3% on your loan. I think I pay something in the range of $300 a year in interest on my 2014 Subaru Legacy, and my payments are only $230 a month.

 
spmahn said:
This is terrible advice, unless you're wealthy or buying a clunker, most people are going to take out a loan for a car, and unless your credit is absolute garbage, it's unlikely you'll ever be paying more than 5% interest anyways, which is nothing. Personally, I've always found the best deals when buying new, as long as you have a couple grand to put for a down payment. You'll get far better financing options buying new, and dealers will frequently be able to get you under 3% on your loan. I think I pay something in the range of $300 a year in interest on my 2014 Subaru Legacy, and my payments are only $230 a month.
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It's dumb that some people come in here and say things like he did. A majority of people will be getting auto loans, and actually getting advice can help tremendously with being in a better place and position. Also understanding your vehicle, your loan, hidden fees, and things to look out for are huge.

 
IMO the absolute most financially responsible way to purchase a car is to 2-4 year old used car with cash.  Let someone else take the initial "drive off the lot" depreciation.  Jump in an off lease car or grandma who put 3k miles on in a year.

If you have to borrow the money to buy the car then you probably shouldn't be buying it.

Used cars are just fine...new cars are not unbreakable and can be just as reliable.  I have a 15 year old Jeep Cherokee that runs like a champ.

Here is a perfect example...2013 Lexus ES350 is ~38K-39K brand new.  Here it is 2 years later with a 28.8K asking price.

http://www.cars.com/vehicledetail/detail/636489190/overview/

You can potentially save yourself 10-12K if you waited and bought it used.  If you are consistently buy new cars every 3-5 years then you are continually buying things that go down in value.  Keep turning 30K into 15K and see where you are at at the end of the decade.

Good luck...best way to buy a car for a dealer is find the very specific car you want, do tons of research on it via the internet, when ready to buy negotiate the price of car, check the fees and the just write a check and don't buy any warranties.

 
spmahn said:
This is terrible advice, unless you're wealthy or buying a clunker, most people are going to take out a loan for a car, and unless your credit is absolute garbage, it's unlikely you'll ever be paying more than 5% interest anyways, which is nothing. Personally, I've always found the best deals when buying new, as long as you have a couple grand to put for a down payment. You'll get far better financing options buying new, and dealers will frequently be able to get you under 3% on your loan. I think I pay something in the range of $300 a year in interest on my 2014 Subaru Legacy, and my payments are only $230 a month.
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You don't need to be wealthy to buy a 15-20K car without a loan. Many of these people getting loans for these cars have no money...therefore the should stay away from the dealership.

 
jms493 said:
You don't need to be wealthy to buy a 15-20K car without a loan. Many of these people getting loans for these cars have no money...therefore the should stay away from the dealership.
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So what did you drive while you saved up 15 to 20k? You still sound ignorant. The fact is a very large portion of the population can't pay cash for cars, so this thread was in place to give advice to people wanting to finance a car...

 
Sorry I wont hijack your thread. I just do not take out auto loans. I will save up money and buy a car with in my means. I lived at home and worked mowing lawns and delivering papers to buy my first car.
 
I think only the internet thinks people don't get loans to buy cars. The only people I know in real life who don't take out loans are people pulling in 80k+ a year or drug dealers. Fact is most people do, most because their income is low, yes while others do it because they are budget freaks with their money and feel a loan is something they are comfortable with doing opposed to just blowing a huge amount of cash like that on a car. I hear the same tired old statement every time regarding people having to take out loans ("you shouldn't be borrowing money" then) but the reality is you do not know these people to surmise a reply like that to them. So you know their income or at least suspect you do since they are requiring a loan to pay for a car, but you don't know anything else about them like their living conditions, whether they are responsible or not, any additional income they take in, if they are with a spouse or anyone that contributes, etc. There's just so much that goes into it and it's pretty funny and kinda arrogant you will get some people on the internet that feel they are helicopter accountants and financial experts on their lives when the truth is they don't know shit. (this wasn't directed at anyone particular in this thread btw as if it was I would have specified)

 
Plus, buy in a city with more dealers, competition, and volumes moved (quantity profits over smaller volume dealers who cannot afford low widget profits).

Also, you can buy last year's new cars and still get a new vehicle with savings.

An example to highlight OP, 2011 Mazda 6, bought 2012 new with V6 and most feature minus keyless ignition and ash trays, wanted over $33k, but was able to get for $27,7k with check/preapproved loan from bank. I think I put about $5-8k down and got the actual loan of around $20k, and sorry, I'm unsure my interest rate, as it would be beneficial.

Don't forget out-of-state tax and titles fees, which I also forgot what the tax was, but DMV wanted something around $1k for the tax and license.

I also agree mixedly with opinions. If you cannot afford to make payments, then you probably won't be approved for an auto loan. However, "never get a loan for depreciating value item" is advice from or for people without reliable incomes. If you have an extra $1600 at the end of the month and are in need of reliable transportation, why would you wait until you have saved $30k over the course of 5-10 years?

Sorry fianance isnt my specialty, but aren't auto loans incredibly low interest?

My home theatre was a $3k no-interest loan, so even tho I am budgeting $300 a month to pay it off before 2 years are up, I should be gaming on a burned-out TV and stock speakers, instead of being incredibly happy with the equipment I have because it will only depreciate?

I think it's only a mistake if you buy a loan to try to sell something and make less profit, but if you are going to use what you get your loans for and need (or heck, want) and are responsible, there is absolutely no reason to not get a loan and some free sound advice from someone in the business of car dealerships.

Well if you take someone's advice from a forum that says "don't get an auto loan" and just stop your pursuit if research or knowledge on the subject, maybe the bus is right for you, but I doubt anyone in the need of transportation is going to just give up due to some negative comments here.

Anyway, just don't get discouraged. You can shop all day for good used prices, too, but you can also get new vehicles that are affordable, reliable, and also "all your's." Plus, I may be borderlining a myth, but vehicles are only lasting longer than their 20-year old counterparts if you keep up on proper maintenance.

Yes new is more expensive than used, but factoring mileages and possible future problems, new can even be a better value than used, but I suppose that's a little upbringing talking and less sourcable facts, but I have been doing this for my last three vehicles and have always been quite pleased with my vehicle purchases and savings.
 
I agree buy from cities where there are lots of dealers.  High volume dealers will cut the price if you ask and play some hardball.  They are all about the volume.

FYI back in the day in the spawn of car dealers loans were forbidden.  Henry Ford resisted the longest but eventually had to give in and now Ford Motor Credit Company is one of the highest grossing branches of Ford.  

I just wish people would think a little different and not just immediately think loan when purchasing a car.  Most people have $100 to their name and think borrowing @25K for a new car is an ok idea or even worse...leasing one.

 
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jms493 said:
I agree buy from cities where there are lots of dealers. High volume dealers will cut the price if you ask and play some hardball. They are all about the volume.

FYI back in the day in the spawn of car dealers loans were forbidden. Henry Ford resisted the longest but eventually had to give in and now Ford Motor Credit Company is one of the highest grossing branches of Ford.

I just wish people would think a little different and not just immediately think loan when purchasing a car. Most people have $100 to their name and think borrowing @25K for a new car is an ok idea or even worse...leasing one.
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Your point again makes no sense. That person with $100 to their name would never qualify for that 25k car, maybe an 8k car so that they can get to work.

And actually in the last tow years or so, leasing has taken over as it has become one of the better ways to get a car. Please explain to me why you think leasing is a bad thing? Besides the Mileage cap.

 
I think maybe the bigger point that jms493 is trying to make is that people, regardless of what financing they can get approved for, are either extremely naive or completely apathetic to their personal financial situation when making decisions on how to purchase a car that will suit them best for their relative income. I don't want to speak for him, but I think he's trying to make a point about moral responsibility when the OP may have geared the thread more towards just helping people make better loan choices. 

I guess my post will inevitably derail this even further, but I'll share my own experience of people who finance foolishly:

You always hear about guys in the military coming back from overseas deployments with wads of cash and doing stupid irresponsible shit with their money. After just one deployment, I saw one low ranked enlisted soldier, who didn't even own a house or a garage to put a car in, buy a Jaguar. Another fool purchased a Dodge Charger and then went out and paid another 4 grand for chrome wheels to put on it. But the worst thing I saw was one of my own squadmates buy a Nissan Sentra or some equivalent and take out a 18% interest loan to pay for it. I ASKED HIM - I said please wait for me to get back from leave and I will help you go through the steps to purchase a car responsibly - but he just wouldn't wait for me and like the other two examples above, he lost the car within a year of purchase. 

I have no point to make here other than I can sympathize with those who wish to urge others to avoid loans...but I can also see that if it's done intelligently it doesn't need to be completely ostracized or avoided.

 
JoshTX said:
I think maybe the bigger point that jms493 is trying to make is that people, regardless of what financing they can get approved for, are either extremely naive or completely apathetic to their personal financial situation when making decisions on how to purchase a car that will suit them best for their relative income. I don't want to speak for him, but I think he's trying to make a point about moral responsibility when the OP may have geared the thread more towards just helping people make better loan choices.

I guess my post will inevitably derail this even further, but I'll share my own experience of people who finance foolishly:

You always hear about guys in the military coming back from overseas deployments with wads of cash and doing stupid irresponsible shit with their money. After just one deployment, I saw one low ranked enlisted soldier, who didn't even own a house or a garage to put a car in, buy a Jaguar. Another fool purchased a Dodge Charger and then went out and paid another 4 grand for chrome wheels to put on it. But the worst thing I saw was one of my own squadmates buy a Nissan Sentra or some equivalent and take out a 18% interest loan to pay for it. I ASKED HIM - I said please wait for me to get back from leave and I will help you go through the steps to purchase a car responsibly - but he just wouldn't wait for me and like the other two examples above, he lost the car within a year of purchase.

I have no point to make here other than I can sympathize with those who wish to urge others to avoid loans...but I can also see that if it's done intelligently it doesn't need to be completely ostracized or avoided.
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https://www.youtube.com/watch?v=C1KVINM4t4U

 
JoshTX said:
I think maybe the bigger point that jms493 is trying to make is that people, regardless of what financing they can get approved for, are either extremely naive or completely apathetic to their personal financial situation when making decisions on how to purchase a car that will suit them best for their relative income. I don't want to speak for him, but I think he's trying to make a point about moral responsibility when the OP may have geared the thread more towards just helping people make better loan choices.

I guess my post will inevitably derail this even further, but I'll share my own experience of people who finance foolishly:

You always hear about guys in the military coming back from overseas deployments with wads of cash and doing stupid irresponsible shit with their money. After just one deployment, I saw one low ranked enlisted soldier, who didn't even own a house or a garage to put a car in, buy a Jaguar. Another fool purchased a Dodge Charger and then went out and paid another 4 grand for chrome wheels to put on it. But the worst thing I saw was one of my own squadmates buy a Nissan Sentra or some equivalent and take out a 18% interest loan to pay for it. I ASKED HIM - I said please wait for me to get back from leave and I will help you go through the steps to purchase a car responsibly - but he just wouldn't wait for me and like the other two examples above, he lost the car within a year of purchase.

I have no point to make here other than I can sympathize with those who wish to urge others to avoid loans...but I can also see that if it's done intelligently it doesn't need to be completely ostracized or avoided.
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While I agree with you and your post, my response to the other poster stemmed from a previous post in which he stated no one should be getting an auto loan ever and everyone is pretty much dumb if they do... He then went on to point out the idea that if you can't pay cash you shouldn't be getting the car. While your point is 100% valid and correct, it wasn't exactly what I was talking about.

 
bestkeeper14 said:
While I agree with you and your post, my response to the other poster stemmed from a previous post in which he stated no one should be getting an auto loan ever and everyone is pretty much dumb if they do... He then went on to point out the idea that if you can't pay cash you shouldn't be getting the car. While your point is 100% valid and correct, it wasn't exactly what I was talking about.
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Touche. I got the idea that I was getting a bit off topic halfway into the rant, but just decided to finish it anyway...lol.

Thanks for the tips you've shared. If I had a printed copy of your speech and was still in the Army, I'd hand it to every new soldier that landed on post. Most of them need it.

 
JoshTX said:
Touche. I got the idea that I was getting a bit off topic halfway into the rant, but just decided to finish it anyway...lol.

Thanks for the tips you've shared. If I had a printed copy of your speech and was still in the Army, I'd hand it to every new soldier that landed on post. Most of them need it.
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We see what you explain a lot also with younger people who get great jobs out of college. There is an engineering school by is that is tops in the nations. Kids graduate, get jobs with oil companies, and first thing they do is get that $50,000 plus truck or Sports car. We always have to reel them in and even say, just because you think you have the income, doesn't mean you have to go buy that expensive car for your very first car loan.

 
bestkeeper14 said:
Your point again makes no sense. That person with $100 to their name would never qualify for that 25k car, maybe an 8k car so that they can get to work.

And actually in the last tow years or so, leasing has taken over as it has become one of the better ways to get a car. Please explain to me why you think leasing is a bad thing? Besides the Mileage cap.
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If I had $100 to my name but had a 800 credit score could I get a 25K loan?

 
As for the myth on leasing, it is actually becoming a better option than buying due to the used car market and how hard it is stay right side up on a loan.  

Yes a lease means you technically don't own the car, however if the mileage isn't a problem it is a very good option.  At the end of the lease, if the car is "upside" down in value to your residual, walk away rather than owe money.  If you have equity, trade the car in and get a check or buy out the lease with a regular auto loan.  Then you get a one owner car that you know the history of and won't be taken advantage of by a used car salesman.

Leasing isn't for everyone, but it isn't as bad as most people think it is.

 
Listen I dont want to crush this thread with this stuff…but people should look at the purchase price of the car and not the monthly payment.  Just because the monthly payment fits into your monthly budget doesn’t mean you should buy/lease a $30-40K car.  

 
I dont like leasing for a few reasons.

  • Its the most expensive way to operate a vehicle.  The money factor when actually converted is usually higher than some interest rates.  Essentially it seems like a 7 year loan.  3 year lease then come back and buy it and get a 4 year loan....seems crazy to me.
  • The mileage cap...which actually isn't that bad if you are turning in and buying something else.
  • The difficulty of getting out of the lease if something should happen early in the lease.  Most of the time you will be upside down and most people don't have the money to payoff the difference if they lose their job and need to sell the car.  Not that much different than getting a loan except you usually put a down payment when buying.
  • The idea of me paying all the depreciation and then giving it back for the dealer sell again seems only good for the dealer and not for the buyer.
 
jms493 said:
Listen I dont want to crush this thread with this stuff…but people should look at the purchase price of the car and not the monthly payment. Just because the monthly payment fits into your monthly budget doesn’t mean you should buy/lease a $30-40K car.
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Agreed! No where did I ever say to look at the Payment. The important part is the price of the car. Which is why if you look in my original post I talked about LTV. Do you know what LTV is? Loan to Value, meaning the purchase price of the car. Price of the car vs it's actual value. So no monthly payment isn't important in that aspect, but it is still important as well to know if you can afford it. Negotiate a lower price for the car, and the payment will go down. One should be primary focused on the purchase price.

I actually just leased a 40k car, invoice was 42k, my purchase price was 40k, I then got a $5000 rebate, so purchase price was 35k. So I am leasing for 3 years, the "amount" the car depreciates in those 3 years. yes it is an estimate, but it is also negotiable when you turn in the car. So long as I stay under 12,000 miles a year (I drive between 700-800 miles a month), at the end I can turn in the car without the issue of having to pay extra on the loan due to loss of value. I can easily afford the roughly $380 a month payment for a brand new car that I enjoy driving, is covered under warranty, and provides free maintenance throughout the 3 years.

 
When friends/family ask me about buying a car most will end up up arguing with me on this subject 
and its fine...its your money do what you pleases you.  I did a lease and I had car loans and I finally got fed up
with making these payments for cars all the time.  I changed my ways and only look at what I can pay cash for.
if I can't write a check for it then I can't buy it.  It certainly changes my perspective on just about everything and the result of it is I have more money in the bank/investments.
 
jms493 said:
I dont like leasing for a few reasons.

  • Its the most expensive way to operate a vehicle. The money factor when actually converted is usually higher than some interest rates. Essentially it seems like a 7 year loan. 3 year lease then come back and buy it and get a 4 year loan....seems crazy to me.
Yes, which is why you go for a 2 or 3 year loan, you would be surprised the number of people that are doing 84 month loans now...

  • The mileage cap...which actually isn't that bad if you are turning in and buying something else.

    Yea not bad at all, again you should know if you can stay under the cap

  • The difficulty of getting out of the lease if something should happen early in the lease. Most of the time you will be upside down and most people don't have the money to payoff the difference if they lose their job and need to sell the car. Not that much different than getting a loan except you usually put a down payment when buying.

    This is the biggest negative, however same thing can happen when purchasing a vehicle, can't afford payments and may be upside down unable to trade or give back without it being repo'd
  • The idea of me paying all the depreciation and then giving it back for the dealer sell again seems only good for the dealer and not for the buyer.

    Then keep the vehicle, the best time to give it back is if it is way upside down and in the end the manufacturer loses money on the deal. Heck you can even make money if you have equity by using the lease as a trade
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jms493 said:
When friends/family ask me about buying a car most will end up up arguing with me on this subject
and its fine...its your money do what you pleases you. I did a lease and I had car loans and I finally got fed up
with making these payments for cars all the time. I changed my ways and only look at what I can pay cash for.
if I can't write a check for it then I can't buy it. It certainly changes my perspective on just about everything and the result of it is I have more money in the bank/investments.
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And that's good for you, but the majority of America do not have the means to do that. They may need transportation now and can't take the time to save, or can't put aside enough money to get a car in the time they need. It is AGAIN based on each person's situation, but to think that paying cash is the ONLY way to buy cars may be great for you, but not to a majority. And those people can take advantage of good advice in how to finance or lease a vehicle.

 
Maybe I came in this thread a little too hot...I just want to share my view on purchasing a car.  People need to realize that taking out a car loan is taking on risk.  Life can change in a heartbeat and your job can change.  I could take out that lease with my 10 mile commute no problem until your job changes and now you are driving 40 miles each way...uh oh.
 
Anyway...I hope you can help people because there are lot of good dealers out there and a lot of scummy ones.  Unfortunatley the scummy ones ruin it for everyone.
 
Do tons of research before you go to the dealer...the internet is a wonderful place for this stuff.  Information is $$$
 
Most of this stuff has already been covered in the CAG Car Thread, but yeah, information=$$$. You simply can't do enough research because there's always something new to learn or refresh yourself on.

A good community helps too. That's how I got my car for almost $1k under invoice, which is unheard of considering where I live and the car I bought. Good credit also got me a 1.74% interest rate.

 
spmahn said:
This is terrible advice, unless you're wealthy or buying a clunker, most people are going to take out a loan for a car, and unless your credit is absolute garbage, it's unlikely you'll ever be paying more than 5% interest anyways, which is nothing. Personally, I've always found the best deals when buying new, as long as you have a couple grand to put for a down payment. You'll get far better financing options buying new, and dealers will frequently be able to get you under 3% on your loan. I think I pay something in the range of $300 a year in interest on my 2014 Subaru Legacy, and my payments are only $230 a month.
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Lol, I paid 26% interest on mine. 3 year loan, sale value 4400, ended up paying 10402 after all was said and done. I was young, learned my lesson never took a car loan after that. I save up, walk in with X cash, (a price I decide I'm paying before I talk to a salesman - plus taxes etc) and walk out keys in hand.

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My fiancee and I currently have credit scores in the mid to high 700s, no auto loans, no credit card debt, no debt besides mortgage on our house. Our mortgage including taxes, insurance and HOA is 13 of our monthly income.

We want to buy 2 used cars that financed at current rates for 60 months, the monthly payments would total 4 of our monthly income.

Do you guys see any issues with our bank approving 2 separate loans at the same time?
 
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