Five (5) lessons to make you think about the way we treat people.
1 - First Important Lesson - Cleaning Lady.
During my second month of college, our professor gave us a pop quiz. I was a conscientious student and had breezed through the questions until I read the last one: 'What is the first name of the woman who cleans the school?' Surely this was some kind of joke. I had seen the cleaning woman several times. She was tall, dark-haired and in her 50s, but how would I know her name? I handed in my paper, leaving the last question blank. Just before class ended, one student asked if the last question would count toward our quiz grade. 'Absolutely,' said the professor. 'In your careers, you will meet many people. All are significant. They deserve your attention and care, even if all you do is smile and say 'hello.' I've never forgotten that lesson. I also learned hername was Dorothy.
2. - Second Important Lesson - Pickup in the Rain One night, at 11:3 0 p.m.
An older African-Americanwoman was standing on the side of an Alabama highway trying to endure a lashing rainstorm. Her car had broken down and she desperately needed a ride. Soaking wet, she decided to flag down the next car. A young white man stopped to help her, generally unheard of in those conflict-filled 60s. The man took her to safety, helped her get assistance and put her into a taxicab. She seemed to be in a big hurry, but wrote down his address and thanked him. Seven days went by and a knock came on the man's door. To his surprise, a giant console color TV was delivered to his home. A special note was attached..It read: 'Thank you so much for assisting me on the highway the other night. The rain drenched not only my clothes, but also my spirits. Then you came along. Because of you, I was able to make it to my dying husband's bedside just before he passed away... Godbless you for helping me and unselfishly serving others.' Sincerely, Mrs. Nat King Cole.
3 - Third Important Lesson - Always remember those who serve.
In the days when an ice cream sundae cost much less,a 10-year-old boy entered a hotel coffee shop and sat at a table. A waitress put a glass of water in front of him.'How much is an ice cream sundae?' he asked.'Fifty cents,' replied the waitress. The little boy pulled is hand out of his pocket and studied the coins in it.'Well, how much is a plain dish of ice cream?' he inquired.By now more people were waiting for a table and the waitress was growing impatient. 'Thirty-five cents,' she brusquely replied. The little boy again counted his coins. 'I'll have the plain ice cream,' he said. The waitress brought the ice cream, put the bill on the table and walked away. The boy finished the ice cream, paid the cashier and left. When the waitress came back, she began to cry as she wiped down the table. There, placed neatly beside the empty dish, were two nickels and five pennies
You see, he couldn't have the sundae, because he had to have enough left to leave her a tip.
4 - Fourth Important Lesson. - The obstacle in Our Path.
In ancient times, a King had a boulder placed on a roadway. Then he hid himself and watched to see if anyone would remove the huge rock. Some of theking's wealthiest merchants and courtiers came byand simply walked around it. Many loudly blamed the King for not keeping the roads clear, but none did anything about getting the stone out of the way. Then a peasant came along carrying a load of vegetables. Upon approaching the boulder, the peasant laid down his burden and tried to move the stone to the side of the road. After much pushing and straining, he finally succeeded. After the peasant picked up his load of vegetables, he noticed a purse lying in the road where the boulder had been. The purse contained many gold coins and a note from the King indicating that the gold was for the person who removed the boulder from the roadway. The peasant learned what many of us never understand! Every obstacle presents an opportunity to improve our condition.
5 - Fifth Important Lesson - Giving When it Counts...
Many years ago, when I worked as a volunteer at a hospital, I got to know a little girl named Liz who was suffering from a rare & serious disease. Her only chance of recovery appeared to be a blood transfusion from her 5-year old brother, who had miraculously survived the same disease and had developed the antibodies needed to combat the illness. The doctor explained the situation to her little brother, and asked the little boy if he would be willing to give his blood to his sister .I saw him hesitate for only a moment before taking a deep breath and saying, 'Yes, I'll do it if it will save her.' As the transfusion progressed, he lay in bed next to his sister and smiled, as we all did,seeing the color returning to her cheek. Then his face grew pale and his smile faded. He looked up at the doctor and asked with a trembling voice, 'Will I start to die right away?' Being young, the little boy had misunderstood thedoctor; he thought he was going to have to give his sister all of his blood in order to save her.
'Work like you don't need the money,
love like you've never been hurt,
and dance like you do when nobody's watching.'
Wow.
Wednesday, December 26, 2007
Friday, December 21, 2007
Merry Christmas and Happy Holidays !!!
Merry Christmas 2007. See you all next year !!!
Automotive Finance F&I Insurance
http://www.AFItoday.blogspot.com
Automotive Finance F&I Insurance
http://www.AFItoday.blogspot.com
Monday, November 19, 2007
Automotive Finance F&I Insurance - GOOD STUFF!!!
Article from Dealer F&I: (http://www.imakenews.com/dealerfi/e_article000955564.cfm?x=bbDBJgD,b5R7V6RL)
November 16, 2007 Survey:
One-third of Americans concerned about credit... As woes in the subprime mortgage market persist, a new survey indicates that Americans shopping for car loans and other forms of credit are beginning to get nervous.
The survey of 1,000 consumers was fielded in late October by market researcher Synovate of Chicago for GDEXAuto – a new Web-based marketplace that promises auto dealers and financial institutions can come together to securely package, buy and sell asset-backed debt.
In response to the question – “Given the fallout in the subprime mortgage market, how concerned are you that your ability to obtain credit for something like a car loan will be affected?” -- one-third of the sample (33 percent) said they were “extremely” or “somewhat” concerned their credit may be at risk.
“Our survey highlights a continuing need to offer lending to a number of cash-strapped segments, with emphasis on the family/young adult market,” said Michael Sheridan, founder and president of GDEXAuto. “Next to mortgage lenders and home builders, no one is keeping a closer watch on sub-prime finance trends than America’s automobile dealers and affected lenders.” In 2006 those financial institutions made more than $50 billion in auto loans to sub-prime borrowers, according to J.D. Power and Associates.
Among the survey’s key findings:
* Youths Feel at Risk. Concern increases with younger respondents; fully 45 percent of 18-24 year-olds are concerned, along with 43 percent in the 25-34 group, compared to only 15 percent in the 65+ age bracket -- individuals who are less likely to be seeking credit for a car or other big-ticket item.
* Concern Matches Credit Need. By income, the greatest concern (43 percent) lies in within the $25K-$50K segment -- people with enough income to have an interest in a car loan, but not so much that they don't need the loan.
* Kids Raise the Stakes. Likewise, respondents with children in the household – individuals who are more likely to be in the market for a car loan – expressed greater concern (44 percent) than respondents in households without kids (27 percent).
* Credit Impact Already Felt. For some of those in the lowest income bracket, this isn’t a theoretical question; 12 percent say their credit has already been affected.
* Genders Share Concerns. Men are marginally more concerned than women – 35 percent to 32 percent -- but 6 percent of women say their credit has already been affected, against just 2 percent of men.
* Employment Offers Little Relief. Having a job doesn’t significantly diminish these concerns. While 40 percent of the unemployed say they are “extremely” or “somewhat” concerned, 37 percent of those employed fulltime share those concerns. Perhaps less surprisingly, 8 percent of the unemployed are already seeing changes in their ability to get credit.
* Dixie Worried. The perceived credit squeeze is hitting the South hardest; 40 percent expressed concerns – about 10 percent higher than any other region in the country.
* Marked Racial Divide. The racial disparity is even more pronounced – 52 percent of nonwhites expressed concern, versus 30 percent of whites. Likewise, 9 percent of nonwhites say their credit has already been affected.
The GDEXAuto/Synovate survey has a margin of error of +/- 3 percent.
For a full copy of the survey results, email info@edgecommunicationsinc.com.Based in Alamo, Calif., Global Debt Exchange, LLC (GDEX) is a privately held start-up venture that says it simplifies auto finance by offering GDEXAuto, the first Web-based marketplace..
As always, the two best sites for automotive finance wisdom can be found at:
http://www.autofinanceinsider.com/
http://www.autofinanceinsider.blogspot.com/
Two good sites for credit repair info:
http://www.creditrepairedtoday.blogspot.com/
http://www.creditrepairsecrets2.blogspot.com/
Article from Dealer F&I: (http://www.imakenews.com/dealerfi/e_article000955564.cfm?x=bbDBJgD,b5R7V6RL)
November 16, 2007 Survey:
One-third of Americans concerned about credit... As woes in the subprime mortgage market persist, a new survey indicates that Americans shopping for car loans and other forms of credit are beginning to get nervous.
The survey of 1,000 consumers was fielded in late October by market researcher Synovate of Chicago for GDEXAuto – a new Web-based marketplace that promises auto dealers and financial institutions can come together to securely package, buy and sell asset-backed debt.
In response to the question – “Given the fallout in the subprime mortgage market, how concerned are you that your ability to obtain credit for something like a car loan will be affected?” -- one-third of the sample (33 percent) said they were “extremely” or “somewhat” concerned their credit may be at risk.
“Our survey highlights a continuing need to offer lending to a number of cash-strapped segments, with emphasis on the family/young adult market,” said Michael Sheridan, founder and president of GDEXAuto. “Next to mortgage lenders and home builders, no one is keeping a closer watch on sub-prime finance trends than America’s automobile dealers and affected lenders.” In 2006 those financial institutions made more than $50 billion in auto loans to sub-prime borrowers, according to J.D. Power and Associates.
Among the survey’s key findings:
* Youths Feel at Risk. Concern increases with younger respondents; fully 45 percent of 18-24 year-olds are concerned, along with 43 percent in the 25-34 group, compared to only 15 percent in the 65+ age bracket -- individuals who are less likely to be seeking credit for a car or other big-ticket item.
* Concern Matches Credit Need. By income, the greatest concern (43 percent) lies in within the $25K-$50K segment -- people with enough income to have an interest in a car loan, but not so much that they don't need the loan.
* Kids Raise the Stakes. Likewise, respondents with children in the household – individuals who are more likely to be in the market for a car loan – expressed greater concern (44 percent) than respondents in households without kids (27 percent).
* Credit Impact Already Felt. For some of those in the lowest income bracket, this isn’t a theoretical question; 12 percent say their credit has already been affected.
* Genders Share Concerns. Men are marginally more concerned than women – 35 percent to 32 percent -- but 6 percent of women say their credit has already been affected, against just 2 percent of men.
* Employment Offers Little Relief. Having a job doesn’t significantly diminish these concerns. While 40 percent of the unemployed say they are “extremely” or “somewhat” concerned, 37 percent of those employed fulltime share those concerns. Perhaps less surprisingly, 8 percent of the unemployed are already seeing changes in their ability to get credit.
* Dixie Worried. The perceived credit squeeze is hitting the South hardest; 40 percent expressed concerns – about 10 percent higher than any other region in the country.
* Marked Racial Divide. The racial disparity is even more pronounced – 52 percent of nonwhites expressed concern, versus 30 percent of whites. Likewise, 9 percent of nonwhites say their credit has already been affected.
The GDEXAuto/Synovate survey has a margin of error of +/- 3 percent.
For a full copy of the survey results, email info@edgecommunicationsinc.com.Based in Alamo, Calif., Global Debt Exchange, LLC (GDEX) is a privately held start-up venture that says it simplifies auto finance by offering GDEXAuto, the first Web-based marketplace..
As always, the two best sites for automotive finance wisdom can be found at:
http://www.autofinanceinsider.com/
http://www.autofinanceinsider.blogspot.com/
Two good sites for credit repair info:
http://www.creditrepairedtoday.blogspot.com/
http://www.creditrepairsecrets2.blogspot.com/
Automotive Finance F&I Insurance
Article from Dealer F&I (http://www.imakenews.com/dealerfi/e_article000955564.cfm?x=bbDBJgD,b5R7V6RL)
November 16, 2007 Survey: One-third of Americans concerned about credit... As woes in the subprime mortgage market persist, a new survey indicates that Americans shopping for car loans and other forms of credit are beginning to get nervous. The survey of 1,000 consumers was fielded in late October by market researcher Synovate of Chicago for GDEXAuto – a new Web-based marketplace that promises auto dealers and financial institutions can come together to securely package, buy and sell asset-backed debt.
In response to the question – “Given the fallout in the subprime mortgage market, how concerned are you that your ability to obtain credit for something like a car loan will be affected?” -- one-third of the sample (33 percent) said they were “extremely” or “somewhat” concerned their credit may be at risk.
“Our survey highlights a continuing need to offer lending to a number of cash-strapped segments, with emphasis on the family/young adult market,” said Michael Sheridan, founder and president of GDEXAuto. “Next to mortgage lenders and home builders, no one is keeping a closer watch on sub-prime finance trends than America’s automobile dealers and affected lenders.” In 2006 those financial institutions made more than $50 billion in auto loans to sub-prime borrowers, according to J.D. Power and Associates.
Among the survey’s key findings:
o Youths Feel at Risk. Concern increases with younger respondents; fully 45 percent of 18-24 year-olds are concerned, along with 43 percent in the 25-34 group, compared to only 15 percent in the 65+ age bracket -- individuals who are less likely to be seeking credit for a car or other big-ticket item.
o Concern Matches Credit Need. By income, the greatest concern (43 percent) lies in within the $25K-$50K segment -- people with enough income to have an interest in a car loan, but not so much that they don't need the loan.
o Kids Raise the Stakes. Likewise, respondents with children in the household – individuals who are more likely to be in the market for a car loan – expressed greater concern (44 percent) than respondents in households without kids (27 percent).
o Credit Impact Already Felt. For some of those in the lowest income bracket, this isn’t a theoretical question; 12 percent say their credit has already been affected.
o Genders Share Concerns. Men are marginally more concerned than women – 35 percent to 32 percent -- but 6 percent of women say their credit has already been affected, against just 2 percent of men.
o Employment Offers Little Relief. Having a job doesn’t significantly diminish these concerns. While 40 percent of the unemployed say they are “extremely” or “somewhat” concerned, 37 percent of those employed fulltime share those concerns. Perhaps less surprisingly, 8 percent of the unemployed are already seeing changes in their ability to get credit.
o Dixie Worried. The perceived credit squeeze is hitting the South hardest; 40 percent expressed concerns – about 10 percent higher than any other region in the country.
o Marked Racial Divide. The racial disparity is even more pronounced – 52 percent of nonwhites expressed concern, versus 30 percent of whites. Likewise, 9 percent of nonwhites say their credit has already been affected. The GDEXAuto/Synovate survey has a margin of error of +/- 3 percent.
For a full copy of the survey results, email info@edgecommunicationsinc.com.Based in Alamo, Calif., Global Debt Exchange, LLC (GDEX) is a privately held start-up venture that says it simplifies auto finance by offering GDEXAuto, the first Web-based marketplace.
Article from Dealer F&I (http://www.imakenews.com/dealerfi/e_article000955564.cfm?x=bbDBJgD,b5R7V6RL)
November 16, 2007 Survey: One-third of Americans concerned about credit... As woes in the subprime mortgage market persist, a new survey indicates that Americans shopping for car loans and other forms of credit are beginning to get nervous. The survey of 1,000 consumers was fielded in late October by market researcher Synovate of Chicago for GDEXAuto – a new Web-based marketplace that promises auto dealers and financial institutions can come together to securely package, buy and sell asset-backed debt.
In response to the question – “Given the fallout in the subprime mortgage market, how concerned are you that your ability to obtain credit for something like a car loan will be affected?” -- one-third of the sample (33 percent) said they were “extremely” or “somewhat” concerned their credit may be at risk.
“Our survey highlights a continuing need to offer lending to a number of cash-strapped segments, with emphasis on the family/young adult market,” said Michael Sheridan, founder and president of GDEXAuto. “Next to mortgage lenders and home builders, no one is keeping a closer watch on sub-prime finance trends than America’s automobile dealers and affected lenders.” In 2006 those financial institutions made more than $50 billion in auto loans to sub-prime borrowers, according to J.D. Power and Associates.
Among the survey’s key findings:
o Youths Feel at Risk. Concern increases with younger respondents; fully 45 percent of 18-24 year-olds are concerned, along with 43 percent in the 25-34 group, compared to only 15 percent in the 65+ age bracket -- individuals who are less likely to be seeking credit for a car or other big-ticket item.
o Concern Matches Credit Need. By income, the greatest concern (43 percent) lies in within the $25K-$50K segment -- people with enough income to have an interest in a car loan, but not so much that they don't need the loan.
o Kids Raise the Stakes. Likewise, respondents with children in the household – individuals who are more likely to be in the market for a car loan – expressed greater concern (44 percent) than respondents in households without kids (27 percent).
o Credit Impact Already Felt. For some of those in the lowest income bracket, this isn’t a theoretical question; 12 percent say their credit has already been affected.
o Genders Share Concerns. Men are marginally more concerned than women – 35 percent to 32 percent -- but 6 percent of women say their credit has already been affected, against just 2 percent of men.
o Employment Offers Little Relief. Having a job doesn’t significantly diminish these concerns. While 40 percent of the unemployed say they are “extremely” or “somewhat” concerned, 37 percent of those employed fulltime share those concerns. Perhaps less surprisingly, 8 percent of the unemployed are already seeing changes in their ability to get credit.
o Dixie Worried. The perceived credit squeeze is hitting the South hardest; 40 percent expressed concerns – about 10 percent higher than any other region in the country.
o Marked Racial Divide. The racial disparity is even more pronounced – 52 percent of nonwhites expressed concern, versus 30 percent of whites. Likewise, 9 percent of nonwhites say their credit has already been affected. The GDEXAuto/Synovate survey has a margin of error of +/- 3 percent.
For a full copy of the survey results, email info@edgecommunicationsinc.com.Based in Alamo, Calif., Global Debt Exchange, LLC (GDEX) is a privately held start-up venture that says it simplifies auto finance by offering GDEXAuto, the first Web-based marketplace.
Tuesday, October 23, 2007
The hidden numbers behind zero-percent financing:
Nothing could be more enticing than free money, and that's what the current round of zero-percent finance deals seem to offer.
Remember the adage, "There's no such thing as a free lunch?'' Well, free money is equally suspicious. There are strings and conditions to nearly all such offers from manufacturers.
Aside from the usual requirement of sparkling credit, there are ways in which zero-percent car loans can trip up a buyer.
Most interest-free financing offers require financing terms of three years or less. So you'll have to shell out some pretty hefty monthly payments if you qualify.
Example: Let's say you're borrowing $20,000 to pay for your new car. With a three-year term at zero-percent interest, your family would have to shell out more than $555 per month in car payments. A five-year term at 3.9 percent with monthly payments of $367.43 may be more manageable, even though you have to pay interest.
If you are financing $20,000 ...
Interest rate
Monthly payments
Total interest
3 years
0%
$555
$0
5 years
3.9%
$367.43
$2,045.71
And some zero-percent offers come with the stipulation that the buyer has to put down as much as 25 percent, whereas most other finance deals can be had with 10 percent or even nothing down, though it's often not wise to cut your down payment to a minimum because it will take longer to build equity.
originally posted by Bankrate.com
Nothing could be more enticing than free money, and that's what the current round of zero-percent finance deals seem to offer.
Remember the adage, "There's no such thing as a free lunch?'' Well, free money is equally suspicious. There are strings and conditions to nearly all such offers from manufacturers.
Aside from the usual requirement of sparkling credit, there are ways in which zero-percent car loans can trip up a buyer.
Most interest-free financing offers require financing terms of three years or less. So you'll have to shell out some pretty hefty monthly payments if you qualify.
Example: Let's say you're borrowing $20,000 to pay for your new car. With a three-year term at zero-percent interest, your family would have to shell out more than $555 per month in car payments. A five-year term at 3.9 percent with monthly payments of $367.43 may be more manageable, even though you have to pay interest.
If you are financing $20,000 ...
Interest rate
Monthly payments
Total interest
3 years
0%
$555
$0
5 years
3.9%
$367.43
$2,045.71
And some zero-percent offers come with the stipulation that the buyer has to put down as much as 25 percent, whereas most other finance deals can be had with 10 percent or even nothing down, though it's often not wise to cut your down payment to a minimum because it will take longer to build equity.
originally posted by Bankrate.com
When you look at financing that new car, your usual choices are going to be:
Go with something the dealer offers you, or get financing on your own from a bank, credit union or other lender.
Deciding which way to go can be confusing because manufacturers and dealers offer a wide array of promotional finance deals. One car company a few years ago even offered a loan with no payments for the first year. Sounds good, huh? Until you looked at the fine print and discovered that it was a five-year loan and the payments for the last four years were jacked up to cover what you didn't pay that first year.
So consider any special deals as just a starting point, especially when there's a choice of cut-rate financing or a cash manufacturer's rebate.
Rate is only one factor. A really low interest rate, undeniably, is attractive. Keep in mind that the interest rate is only one of many factors and numbers that go into the overall cost of your new vehicle and it can be calculated in different ways: The APR (annual percentage rate) is the best rate to use for comparisons.
Getting a "low, low'' interest rate might not save you money in the long run if the numbers are inflated elsewhere in the deal. The same is true of a rebate.
So what's a better deal: Snapping up an ultra-low financing rate or pocketing a $1,000 rebate? It depends.
First, everyone is eligible for a manufacturer's rebate, which isn't true for the financing deals, which may depend on a high credit score.
Consider this rebate vs. finance deal comparison:
Rebate vs. finance
Is it better to take a $1,000 rebate with an 8% interest rate? Or a 2.9% rate with no rebate?
•
Loan is $15,000 over four years
•
$7,500 x .05 = $375
•
$375 x 4 years = $1,500
Say a person considering a small sedan must choose between taking 2.9 percent financing on a four-year, $15,000 loan, or taking 8 percent financing on a four-year loan and snapping up a $1,000 rebate.
Start by taking half of the loan amount and multiplying it by the difference between the two financing rates. This gives an idea of how much money can be saved per year with the cheaper financing rate. For simplicity's sake, round off the 2.9 percent interest rate to 3 percent.
In this case, multiply 7,500 by .05 (5 percent, which is the difference between the two interest rates of 8 and 3) for a total of $375.
Then multiply that $375 by the number of years in the loan -- in this case, four.
The answer, $1,500, is the amount this sedan buyer would save by taking a four-year loan at the lower interest rate. Because the rebate is $1,000, this customer would save an additional $500 by choosing the low-rate financing over the rebate.
Of course, people with good credit ratings can get the best of both worlds by taking the rebate from the dealer and getting the same low rate -- or lower -- somewhere else.
Shop first for loanThe best way to buy and finance a car is to shop around for the loan first. Internet lenders have proliferated in recent years and often offer very good rates. They usually will approve you for a total amount to be financed before you go shopping, leaving you free to concentrate on price alone.
Remember, the car dealer is little more than a middleman when it comes to financing. Often, dealers bump up the auto loan rates of the banks and finance companies with which they do business. A customer may do better elsewhere.
-- originally posted by Bankrate.com but endorsed by FandI2.blogspot.com.
Go with something the dealer offers you, or get financing on your own from a bank, credit union or other lender.
Deciding which way to go can be confusing because manufacturers and dealers offer a wide array of promotional finance deals. One car company a few years ago even offered a loan with no payments for the first year. Sounds good, huh? Until you looked at the fine print and discovered that it was a five-year loan and the payments for the last four years were jacked up to cover what you didn't pay that first year.
So consider any special deals as just a starting point, especially when there's a choice of cut-rate financing or a cash manufacturer's rebate.
Rate is only one factor. A really low interest rate, undeniably, is attractive. Keep in mind that the interest rate is only one of many factors and numbers that go into the overall cost of your new vehicle and it can be calculated in different ways: The APR (annual percentage rate) is the best rate to use for comparisons.
Getting a "low, low'' interest rate might not save you money in the long run if the numbers are inflated elsewhere in the deal. The same is true of a rebate.
So what's a better deal: Snapping up an ultra-low financing rate or pocketing a $1,000 rebate? It depends.
First, everyone is eligible for a manufacturer's rebate, which isn't true for the financing deals, which may depend on a high credit score.
Consider this rebate vs. finance deal comparison:
Rebate vs. finance
Is it better to take a $1,000 rebate with an 8% interest rate? Or a 2.9% rate with no rebate?
•
Loan is $15,000 over four years
•
$7,500 x .05 = $375
•
$375 x 4 years = $1,500
Say a person considering a small sedan must choose between taking 2.9 percent financing on a four-year, $15,000 loan, or taking 8 percent financing on a four-year loan and snapping up a $1,000 rebate.
Start by taking half of the loan amount and multiplying it by the difference between the two financing rates. This gives an idea of how much money can be saved per year with the cheaper financing rate. For simplicity's sake, round off the 2.9 percent interest rate to 3 percent.
In this case, multiply 7,500 by .05 (5 percent, which is the difference between the two interest rates of 8 and 3) for a total of $375.
Then multiply that $375 by the number of years in the loan -- in this case, four.
The answer, $1,500, is the amount this sedan buyer would save by taking a four-year loan at the lower interest rate. Because the rebate is $1,000, this customer would save an additional $500 by choosing the low-rate financing over the rebate.
Of course, people with good credit ratings can get the best of both worlds by taking the rebate from the dealer and getting the same low rate -- or lower -- somewhere else.
Shop first for loanThe best way to buy and finance a car is to shop around for the loan first. Internet lenders have proliferated in recent years and often offer very good rates. They usually will approve you for a total amount to be financed before you go shopping, leaving you free to concentrate on price alone.
Remember, the car dealer is little more than a middleman when it comes to financing. Often, dealers bump up the auto loan rates of the banks and finance companies with which they do business. A customer may do better elsewhere.
-- originally posted by Bankrate.com but endorsed by FandI2.blogspot.com.
Automotive Finance F&I article originally posted by Bankrate.com
We all know that a new car loses a significant amount of its value when you drive it off the lot. That's where the down payment -- the amount of cash you bring to the purchase -- comes in.
The down payment can demonstrate to a lender that you're willing to make an investment in the deal, and perhaps gain a more favorable interest rate. It also helps take some of the shock out of the instant depreciation so you're not "upside down'' on your loan for years and years.
Upside downWhat's it mean to be "upside down?'' You learned in an earlier chapter that it's the industry term for a car owner who owes more on a vehicle than it's worth.
Almost every new car -- and most used-cars -- transactions involve a period of being upside down on the loan. After all, if you put 10 or even 20 percent down on a car and it depreciates 25 percent in the first three months, you're upside down, at least for awhile.
But where it gets worrisome is when the owner remains upside down three and even four years into a loan.
You've also seen earlier how some folks make matters worse by rolling the old car's remaining debt into a new loan. They're forced to pay interest and make payments on a car they don't even own anymore. And tacking the extra debt on their new auto loan puts them upside down all over again.
Up the down paymentHow do you avoid that situation, aside from making the best initial purchase deal possible and not rolling your old car's loan into the deal?
Make a substantial down payment.
These days, the average down payment for an auto loan isn't much of a payment at all. A typical car buyer puts just 5 percent down. That often doesn't even cover the cost of sales tax and other fees, much less make a dent in the depreciation factor.
If at all possible, a buyer should plan on putting down at least 20 percent of the purchase price. With that much down, a buyer should begin to see positive equity about two years into a four-year loan, assuming the vehicle's kept in good shape.
If you can't put down 20 percent, scrape up as much cash as you can and keep the term of the loan as short as possible.
You can use Bankrate's auto loan calculator with amortization table to get the remaining balance at any given point. Comparing that with the estimated value of the car at the same point will tell you when you stop being "upside down" in the loan. That calculator also has an "extra payment" feature that will show you the impact it will have if you apply added sums against the principal.
-- Posted: May 1, 2006surance
We all know that a new car loses a significant amount of its value when you drive it off the lot. That's where the down payment -- the amount of cash you bring to the purchase -- comes in.
The down payment can demonstrate to a lender that you're willing to make an investment in the deal, and perhaps gain a more favorable interest rate. It also helps take some of the shock out of the instant depreciation so you're not "upside down'' on your loan for years and years.
Upside downWhat's it mean to be "upside down?'' You learned in an earlier chapter that it's the industry term for a car owner who owes more on a vehicle than it's worth.
Almost every new car -- and most used-cars -- transactions involve a period of being upside down on the loan. After all, if you put 10 or even 20 percent down on a car and it depreciates 25 percent in the first three months, you're upside down, at least for awhile.
But where it gets worrisome is when the owner remains upside down three and even four years into a loan.
You've also seen earlier how some folks make matters worse by rolling the old car's remaining debt into a new loan. They're forced to pay interest and make payments on a car they don't even own anymore. And tacking the extra debt on their new auto loan puts them upside down all over again.
Up the down paymentHow do you avoid that situation, aside from making the best initial purchase deal possible and not rolling your old car's loan into the deal?
Make a substantial down payment.
These days, the average down payment for an auto loan isn't much of a payment at all. A typical car buyer puts just 5 percent down. That often doesn't even cover the cost of sales tax and other fees, much less make a dent in the depreciation factor.
If at all possible, a buyer should plan on putting down at least 20 percent of the purchase price. With that much down, a buyer should begin to see positive equity about two years into a four-year loan, assuming the vehicle's kept in good shape.
If you can't put down 20 percent, scrape up as much cash as you can and keep the term of the loan as short as possible.
You can use Bankrate's auto loan calculator with amortization table to get the remaining balance at any given point. Comparing that with the estimated value of the car at the same point will tell you when you stop being "upside down" in the loan. That calculator also has an "extra payment" feature that will show you the impact it will have if you apply added sums against the principal.
-- Posted: May 1, 2006surance
Here are some questions that you must ask when discussing financing. Write them down or print them out before going to the dealer. Make sure you get answers to these questions that you fully understand. If anything is vague or confusing, walk away and come back after you've had time to think about it. If the sales or finance person makes a claim you think is too good to be true, have them write it on the finance contract and get a manager to sign off.
What's the interest rate I'm really paying? The APR (annual percentage rate) is the best way to know what interest you are paying. It is the actual interest rate you pay annually on the unpaid balance of the loan. The rate you are offered will to a large extent depend on your credit score, a number that dealers get from your credit report.
Are there any possible penalties in my loan? Does paying the loan off early entail penalties? Are there any other possible extra charges that could occur during the term of my loan? Are there "hidden charges'' that effectively are penalties?
What is the precise (down to the penny) price I'm paying for the vehicle?
What is the total amount (be exact) being financed?
What's the dollar amount I'm paying for the credit (finance charge)?
What's the exact amount of each payment?
What is the total number of payments?
Is this deal contingent on getting subsequent approval of the financing from a third party? Some dealers will send you out the door with a car then call a day or two later to say they couldn't get you financed at the rate they quoted, but they have found a lender who will cover the loan at a higher payment. Don't fall for this. Make sure you know who the lender is and that the deal is sealed before leaving the lot. If there's any question, tell the dealer you'll come back and get the car when everything is settled.
What about credit insurance? Your lender may offer, or even demand, credit insurance. First, find out exactly what it will cost you. If you have an existing insurance policy that covers the same thing, make a thorough comparison. It's not required by federal law, and check your state's requirement (through the office of your attorney general or insurance commissioner) if your lender requires it. Make sure it is included in the cost of your credit and see where it is reflected in the APR you are paying.
-- Posted: May 1, 2006
What's the interest rate I'm really paying? The APR (annual percentage rate) is the best way to know what interest you are paying. It is the actual interest rate you pay annually on the unpaid balance of the loan. The rate you are offered will to a large extent depend on your credit score, a number that dealers get from your credit report.
Are there any possible penalties in my loan? Does paying the loan off early entail penalties? Are there any other possible extra charges that could occur during the term of my loan? Are there "hidden charges'' that effectively are penalties?
What is the precise (down to the penny) price I'm paying for the vehicle?
What is the total amount (be exact) being financed?
What's the dollar amount I'm paying for the credit (finance charge)?
What's the exact amount of each payment?
What is the total number of payments?
Is this deal contingent on getting subsequent approval of the financing from a third party? Some dealers will send you out the door with a car then call a day or two later to say they couldn't get you financed at the rate they quoted, but they have found a lender who will cover the loan at a higher payment. Don't fall for this. Make sure you know who the lender is and that the deal is sealed before leaving the lot. If there's any question, tell the dealer you'll come back and get the car when everything is settled.
What about credit insurance? Your lender may offer, or even demand, credit insurance. First, find out exactly what it will cost you. If you have an existing insurance policy that covers the same thing, make a thorough comparison. It's not required by federal law, and check your state's requirement (through the office of your attorney general or insurance commissioner) if your lender requires it. Make sure it is included in the cost of your credit and see where it is reflected in the APR you are paying.
-- Posted: May 1, 2006
Where to get the money
By Bankrate.com
Seven out of 10 new cars and trucks are financed, and you can also finance the purchase of a used car. But to do it right, you must be prepared before and after you reach the car lot.
You can get an auto loan from a bank, credit union or other financial institution. You can have these loans approved before you ever hit the showroom.
You can also get financing through the dealer or from the auto manufacturer. There will be occasions when a dealer will actually give you the best deal. Unfortunately, those occasions are not predictable (despite endless "must sell," "lowest rates possible" and "no money down" advertising by dealers) and the only way to be sure is by comparison shopping.
One other choice is a home equity loan. You'll get a good interest rate and the payments could be tax deductible. But be sure such a loan won't leave you in any danger of losing your home.
Know your numbersInterest rates on new cars are lower than on used vehicles. And, in general, new cars can be financed over longer terms than used ones. This equation can make a new car cheaper than a used one in many cases.
Not all the numbers in your deal will be locked in before you buy, especially if you go with dealer/manufacturer financing. The interest rate you pay can vary, and so can the down payment and other details, such as the value of your trade-in or the length of the loan you take. You have to decide
Don't let one number dominate you. For example, a really low down payment is not by itself a guarantee of a good deal. You need to consider all the numbers together to know what sort of deal you're getting.
By Bankrate.com
Seven out of 10 new cars and trucks are financed, and you can also finance the purchase of a used car. But to do it right, you must be prepared before and after you reach the car lot.
You can get an auto loan from a bank, credit union or other financial institution. You can have these loans approved before you ever hit the showroom.
You can also get financing through the dealer or from the auto manufacturer. There will be occasions when a dealer will actually give you the best deal. Unfortunately, those occasions are not predictable (despite endless "must sell," "lowest rates possible" and "no money down" advertising by dealers) and the only way to be sure is by comparison shopping.
One other choice is a home equity loan. You'll get a good interest rate and the payments could be tax deductible. But be sure such a loan won't leave you in any danger of losing your home.
Know your numbersInterest rates on new cars are lower than on used vehicles. And, in general, new cars can be financed over longer terms than used ones. This equation can make a new car cheaper than a used one in many cases.
Not all the numbers in your deal will be locked in before you buy, especially if you go with dealer/manufacturer financing. The interest rate you pay can vary, and so can the down payment and other details, such as the value of your trade-in or the length of the loan you take. You have to decide
Don't let one number dominate you. For example, a really low down payment is not by itself a guarantee of a good deal. You need to consider all the numbers together to know what sort of deal you're getting.
Financing the Deal
These gems provided by Bankrate.com should be referred to again and again. Enjoy.
Financing the deal: Introduction
By Bankrate.com
Get a grip on the financing process as we help you shop for a loan and spell out many key questions you should ask before signing on the dotted line.
Financing your car needs as much research and homework as choosing the car. Here you'll learn the questions to ask about a loan, how to find the best auto-loan rate, how to determine your down payment, and what rebate or loan options may apply to you. We've also got calculators throughout the chapter to help make the homework a little easier.
Financing the deal: Introduction
By Bankrate.com
Get a grip on the financing process as we help you shop for a loan and spell out many key questions you should ask before signing on the dotted line.
Financing your car needs as much research and homework as choosing the car. Here you'll learn the questions to ask about a loan, how to find the best auto-loan rate, how to determine your down payment, and what rebate or loan options may apply to you. We've also got calculators throughout the chapter to help make the homework a little easier.
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