Finance Rates
 

Has there been a thread started in the Canadian section for this yet?

Americans are thinking they'll be able to maybe get this car for 1.9%. Any Canadians under the impression they will be able to?

How much wiggle room is there when it comes to negotiating on financing? Is there even any? For instance if Subaru goes and throws a 3.9% up on their website is that the best you'll be able to do without looking elsewhere? Or can you maybe haggle your way into a 2.9% or something?

I think the price is reasonable. But it is going to get unreasonable pretty quickly if things like doc fees and higher interest rates get tacked on at the end.

Anybody been quoted any numbers yet from their dealers?

my game plan is to down as much as I can afford and then from there, accelerate the terms as fast as I can.

I'll down 5-10K, and from there, just pay 1200 per month until its over.

Yeah, the problem for me is that I can't do that. My accountant is going to have it worked out so even though the car will be in my name, my company will lease it from me for the full term.

So making extra payments will just throw a wrench into things.

I don't know, maybe it won't throw a wrench into things. I just assumed it would be more clean if the company was reimbursing me the exact payment amount every month.

1.9%? through who?

MY bank offers 5.5% and the scion i was at had rates posted for all cars but FR-S and they were around the 5% mark also.

1.9 for americans

our current monetary policy calls for moderate interest rates,

i can get a loan from RBC for prime + a points or so due to an asset backed line of credit, with non-compounding interest.

but good luck to anyone finding a loan for less than prime, which is currently at around 3%



i was sorta hoping for a zero financing option like what VW had not too long ago kekekeke

we'll know the finance rates on saturday. our dealership said he received the numbers for this car.

btw, you can haggle a finance rate??

I would look at Scion finance rates now to get a good idea. I believe they range from 2.9% to 4.9% depending on the term.

i believe you can always haggle finance rates with any institution because anything more than 0 is favorable for the person lending you money.

You're assuming that they're lending you cash from a vault but no bank is stupid enough to do that. Paper money that sits on its own devalues to zero long term. All of their cash (minus whatever they're required by law to keep on hand) is tied up in higher yield investments than anything you'd ever pay, except maybe your credit card. What they loan you is what they borrow from the government. So as long as the difference in what they charge you is enough to cover the interest they pay the government (which I think is 1% right now), any of their overhead costs plus whatever income they wish to net, that's what you can hope for. Anytime you hear 0% or 0.9% financing, someone is pulling your prick. A lot of times, they'll offer "cash" discounts or 0.9% financing. All that really means it's that they're taking off the interest revenue they added to the price of the car, which they would have otherwise earned by financing at a normal rate (so they are actually still charging you the same rate).

of course, no one is simply going to give you a low rate or favorable

but i'm speaking strictly conceptually, interest is an entirely arbitrary cost.


if a car dealership is willing you actually give you a car NOW and collect money LATER, they COULD theoretically do that, and charge you a lower interest rate.

it's highly unlikely, but possible.

I personally don't think you can haggle rates. Dealerships will always say their hands are tied by HO in that they dictate cash rebate promotions and they dictate rates.

You can move on the cost of the car + accessories (where dealerships make their money) but not much in financing I don't think. I imagine we'll have a quite high financing rate since they don't need any promotion to move this car. That's why I told my dealer I'd pay cash if the rates are too high since I plan to take out a loan and pay it off quickly.

What I'm saying is that interest isn't actually an arbitrary cost. Some portion of it may be but it's never zero. Anyone to whom the cost of lending out cash is zero has no idea how to manage money, and it's rare for that to be the case for those who have it. So since in most cases this isn't true, there is a cost associated with not taking the full price upfront and you at the very least have to cover that. The dealership doesn't just give you the car and wait 4+ years to get their money back (or worse in the case of a lease). They've bought the car from the factory... that's not much of business model. They get paid by the financing company and that's who you deal with.

So while I agree that in some cases, you can negotiate a rate if the person you're speaking with actually has the access to do that, like a broker, it's still only within a fairly small margin. The bottom line is still there, that being whatever it costs for them to lend the money plus whatever the underwriter says your risk value is. The profit on top of that is what you can play with.

I would think if you don't have any assests listed under your name at the bank that they're unlikely to lower the rate even though you pay off everybill on time,.....

My imagination agrees with yours. The lower rates are only for the high volume stuff.

Banks can actually loan out 10x more money than they actually have. If you have $10,000 in a savings account, your bank is using that $10,000 to borrow out $100,000 to other clients.

Banks lend out money they don't actually have. If everybody tried pulling all their money at once the whole fiduciary system would collapse. Our money system isn't backed by anything.

Trust me, even if they finance at .9% they aren't losing money on you. Unless you consider they could be financing that same amount at 3.9% to somebody else which is obviously in their interest to do.

I would really suggest that everybody do a little research on the financial system before they refinance a big purchase like a house.

Conspiracy theories aside, I just said that banks lend out money they borrow from the government (Bank of Canada), not from deposits. Deposits are invested. And they're not legally obligated to have 100% of their deposit debits available for immediate return, any more than they can demand that you pay back every penny of your loans within a day. If I remember correctly, by law they're only required to keep enough cash on hand to cover up to 50k of anyone's deposit, and I believe this is also federally insured (a necessary thing for back when bank robberies were a real problem).

If I can invest money at 10%+, giving it to you at 0.9% is very much losing money, unless I'm also making 10% on what I'm loaning you money to buy. This is disregarding the fact that maintaining your account takes money (if you saw what it takes to process your cheque, you'd wonder how they're still in business if that's all they did), and there are also the odds that you'll screw me (ie actuary underwriting).

Conspiracies and fact are two very different things. Deposits are invested. Loans are investments. They are one in the same.

I believe in Canada your bank account is insured up to $100,000. If the bank collapses and you had $80,000 in it, you'd get all $80,000 back. If the bank collapsed and you had $1,000,000 in it, you'd get $100,000 back. This is why most people with huge amounts of wealth spread it rather than keeping it one place. Although most people aren't stupid enough to keep large sums of cash sitting in a savings account. But you get the idea.

The bank doesn't have to provide you with all your cash immediately when it's called upon but they do have a set amount of time to get it for you. There were people trying to collapse banks years ago by trying to organize a run on certain banks (which I'm pretty sure is illegal) but anyway, they all failed. You would need a huge percentage of people to be able to do it and even so, it's a horrible ideal to try to collapse your own bank. I think people just wanted to show that the system is flawed.

Part of the chequing system includes NSF Fees (not only the fees charged to the person who wrote it but also the person who received it), and the Overdraft charges that result from said cheques. Trust me. Even if the bank was only in the process of allowing people to write/cash cheques they would still be more than breaking even. And even so, the statement makes little sense because they do in fact do more than just run a chequing system so the point is moot.

Anyway, sorry for hijacking the thread. Carry on!