Getting a loan for an older used car?

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Vermonster
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Getting a loan for an older used car?

Postby Vermonster » Sat Dec 08, 2012 12:59 pm

I'm back and in need of some fairly quick advice.

My girlfriend is looking at getting and auto loan. The car we're most interested in is an 07 Honda Fit with ~107k miles. It will be just under $9k when all is said and done.

The problem is, Chase won't give us a loan for an 07 with over 75k miles, and pretty much everyone else won't do anything older than 08. The problem with the 08s is that there is about a 3k price increase for a marginal increase in quality.

Ideally we were going to be purchasing the car today as she'll need her own transportation on Monday, but it looks like that isn't happening. Any help would be much appreciated.
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cashback
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Postby cashback » Sat Dec 08, 2012 2:07 pm

You've checked with all the local lenders?
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Ratfacedudeguy
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Postby Ratfacedudeguy » Sat Dec 08, 2012 3:50 pm

I agree that you should continue to shop around. My credit union will finance vehicles up to 9 model years old with no cap to the mileage as long as there is sufficient collateral value to secure the loan, so the lenders are out there -- it's just a matter of finding them.
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Rory
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Postby Rory » Sat Dec 08, 2012 5:12 pm

Have you had the car checked out? over 100k miles in 5 years is a hell of a lot of driving. Car was probably owned by a business or rental company. I would try and get as low a price as possible and get it assessed by an independent mechanic.

On the loan ground, check local credit unions. What kind of work do you do? that may make you eligible for a more recognized credit union.
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MemberSince99
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Postby MemberSince99 » Sat Dec 08, 2012 5:13 pm

Agreed. You can get a loan, but the APR won't be anything to write home about, and you may have to put a chunk down. Have you considered a big downpayment? That might sway some lenders who would be on the fence about it due to the high miles.

Since those are highway miles, we all know the car could easily double that. (I've done it). But the bank is only worried about what they will get if you default, and seeing those high miles will scare them off so a big downpayment would be a lower risk to them and they might bite on that. A credit union as suggested is a good idea too. The lower tier lenders should go for it.

Ultimately though, wouldn't it be worth an extra 3k to get something newer or do you really like this particular Fit? I mean if you could put say 3k down, you would only owe 6k on this one and almost surely get someone to bite on loaning you 6k (albeit for a higher APR) or you could get a newer one with more conventional financing.

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Postby paparoach429 » Sat Dec 08, 2012 5:34 pm

I could be wrong but that sounds kind of expensive for that kind of car with those high of miles. I would try to put a big down payment down and if you couldnt finance the rest through a bank then if its a small rinky dink car lot they might do some in house financing. It works pretty much the same way but through them personally, with high apr.

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Postby Vermonster » Sat Dec 08, 2012 6:06 pm

I should have mentioned that we don't really have the money for a down payment. We have about $1300 in cash right now, but a $900 credit card bill. Realistically we could put 1k down and the $300 towards the CC (0% interest for 13 more months so not a big deal). The problem is that Chase is currently the only place that is willing to give a loan for an 07, but the minimum loan amount is $7.5k, so it might not help.

We're starting to look at credit unions in the area and we might be able to get something from one of them.

I understand going for the newer car, and in any other case we probably would. But her max price was originally 6k, but once she set her mind on the Fit she's just been looking at the cheapest cars. To be completely honest, my girlfriend has put this off for almost a month and she's now having to deal with the consequences.
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MemberSince99
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Postby MemberSince99 » Sat Dec 08, 2012 7:07 pm

You're better off to pay off the credit card. Ideally that would have been done before getting the auto loan but I know life isn't perfect.

Yeah she better get on this, gotta get to work that's a big priority.

Maybe this simply is not the car and situation then. She should be able to get a car, but perhaps not this particular one. The really horrible lenders you can get at the buy here pay here places will take her. She's gotta do something but it sounds like maybe this just isn't the particular car that's going to work in your situation.

Vermonster
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Postby Vermonster » Fri Dec 14, 2012 7:02 pm

99 Thanks for the help.

We looked at a few other cars of her choice, all Honda Fits.
Funny side story; We met with a salesman to look at an 08 with 110k miles sticker price was $12k but the online price was $8.9k, so that was the first hesitation. When all was said and done they wanted almost $11k. When we were driving back we simultaneously said "that guy was a douche bag." When he first shook our hands he gave me a strong shake and my girlfriend the "dead fish" handshake. Once he found out she was the one purchasing the car everything changed. You can tell a lot by a handshake.


I looked at another Fit today. It is an 08, 75k miles, new front tires, religiously serviced by the same dealership, 1 owner, immaculate Carfax, just under $11k out the door. I gave the info to Chase and they're giving us a loan for $10,280, 60 months at 5.06%. Other banks will only cover a portion of the value of the car leaving us short a couple grand in most cases.

Included in the price is, $219 VIN etching, ~$800 Sales Tax, and $400 document fee. I'm just wondering if we should be trying to negotiate the prices a bit. I already tried to get the regular price down but they won't budge as it's already 3k under NADA book value.

Now I put a deposit on the car so we don't have to rush but I'd like to hear thoughts. Thanks.
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MemberSince99
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Postby MemberSince99 » Sat Dec 15, 2012 9:41 pm

Well considering that you can get a brand new base Fit 2013 for 15k, I'd say they are NUTS wanting 11k for one that's almost 5 years old with 75k miles. Really the "book" value is the same for one that old as a new one? Honda must REALLY hold its value well then is all I can say. So much for losing a big chunk of its value just by driving it off the lot.

Hell yes you should be trying to negotiate prices. To be honest that VIN etching they EXPECT you to scream about, they will GLADLY take that off to make the sale and still charge you close to 11k making a really nice profit. That's what they HOPE you focus on. And a "document fee" seriously what the hell is that, translated it would more realistically be called "dealer markup fee". Exactly WHAT are they "documenting" here? The fact that some people don't know they are being ripped off? Now getting the title from the state, yeah I know you gotta pay that, is that what this is? Your tags? Otherwise it smells to me just like another way to skim you out of money, and they call it that rather than "owner's slush fund fee" which you'd surely object to.

To be honest I think they want too much. How much would they give YOU if you brought the vehicle in?

And yes I realize they need to make a profit, I and I don't have a problem with that, but you also need the best deal you can get for you.

I love when those guys tell you how "You're stealing all my profit, you're taking food from my children's mouths" I like to turn it around on them and say "your deal would take food from MY children's mouths".

And watch out for the games that start once you think you got a deal done. That's when the REAL profit taking kicks in (the lienance manager). Most devilships I mean dealerships make more there than they do on the cars because people beat them down so bad on that.

But hey I'm going on about other things. Anyway yes, you should negotiate and remember you can walk away they need you as a buyer more than you need their car.



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