So I am considering getting a car using one of the car buying programs. I am a costco member, so I am trying theirs, plus I am getting some leads from edmunds and truecar. What has been peoples experience with these programs? Any recommendations? It seems like they are more of a way to generate leads for companies, but I want to see what people think and what your experience has been.
About a month ago, we used TrueCar to buy a new vehicle for my daughter. We got a car that was exactly what we'd been looking for, and we paid about $1500-2k less for the car compared to local options because we were willing to go outside of the Jacksonville market to make the purchase. A short ride to Daytona saved me enough coin to make it well worth the 180 mile round trip.
Quote:So I am considering getting a car using one of the car buying programs. I am a costco member, so I am trying theirs, plus I am getting some leads from edmunds and truecar. What has been peoples experience with these programs? Any recommendations? It seems like they are more of a way to generate leads for companies, but I want to see what people think and what your experience has been.
Don't bother with Costco. We tried using it and we got to the dealership and they had better
regular offers. Plus we had to take a hike to get to the dealership in
Orlando.
Certified pre-owned coming off lease is the way to go IMO. Let someone else take that initial depreciation hit.
Cash. Money talks B.S. walks as far as I'm concerned. I recently bought a new truck (2015) and got a pretty good price on it. If you're going to finance, then I recommend using your credit union or bank.
The key is to shop around and make the dealership EARN your business, not the other way around.
Quote:About a month ago, we used TrueCar to buy a new vehicle for my daughter. We got a car that was exactly what we'd been looking for, and we paid about $1500-2k less for the car compared to local options because we were willing to go outside of the Jacksonville market to make the purchase. A short ride to Daytona saved me enough coin to make it well worth the 180 mile round trip.
Had a similar experience going through my credit union. Only difference is they delivered a car to me from San Diego.
If you do it, just don't fall for any of the add-ons, most of which you can do yourself much cheaper.
Quote:Cash. Money talks [BAD WORD REMOVED] walks as far as I'm concerned. I recently bought a new truck (2015) and got a pretty good price on it. If you're going to finance, then I recommend using your credit union or bank.
The key is to shop around and make the dealership EARN your business, not the other way around.
I always assumed paying interest on a loan was better than paying cash. Guess I need to start paying with cash.
Sarcasm aside, I do agree with the credit union thought. Got a 2% loan on current car. Hard to beat that.
Quote:Cash. Money talks [BAD WORD REMOVED] walks as far as I'm concerned. I recently bought a new truck (2015) and got a pretty good price on it. If you're going to finance, then I recommend using your credit union or bank.
The key is to shop around and make the dealership EARN your business, not the other way around.
^^ this ^^
cash/credit union for the purchase
TrueCar sounds like the way to find what to purchase, I've just never used them.
Take a look at this web site and consider whether it would help you or not (you need to pay their fee to get all their info on a particular vehicle). It helped me on my purchase a few years ago. This is generally for new vehicles.
http://fightingchance.com/
The gist is that dealerships need to hit certain sales marks to qualify for higher levels of rebates from the manufacturer. A dealership on the verge of hitting the next sales mark is going to be more apt to cut you a deal to get there especially toward the end of the month when time is on your side. Though which dealership is NEEDING the sale the most is not usually readily apparent. The process outlined in their guide helps you flush out which dealership(s) needs your business that month the most. (it won't be the same dealership every month) You have to be willing to possibly drive out of market to get the deal. I ended up getting my last vehicle in New Smyrna Beach and ended up saving over $4k off of sticker which ended up being about 10%. The guide tells you to send out a specifically worded email on a specific day of the month to 10-15 dealerships that carry the specific vehicle you are looking for. A third or half may respond and you will end up having those that do bid for your business. Those are the ones on the verge of the next sales goal. You're also doing this without having to step into a dealership to negotiate.
Do you have to buy new? I always feel that used with very low mileage is the way to go.
Quote:I always assumed paying interest on a loan was better than paying cash. Guess I need to start paying with cash.
Sarcasm aside, I do agree with the credit union thought. Got a 2% loan on current car. Hard to beat that.
The idea is planning and saving. Think you might want to buy a large ticket item such as a vehicle, home, etc.? The best thing to do is save up money for it. If you don't quite have enough to cover the purchase, at least have enough to cover the depreciation of it (in this case of a vehicle). Then if you do need to finance the balance, a credit union will typically offer better rates and/or payment options.
One thing that I did that floored a dealership one time. They offered a discount on a vehicle ONLY if you used their financing. Let's just say that the vehicle cost after the discount was $35,000.00. I wrote them a check for $28,000.00 as a down payment and told them that I wanted to finance the remaining $12,000.00. Of course, I paid the "loan" off when the first payment came due. The figures are just an example and not the actual figures that we dealt with.
One other thing that I advise against. NEVER pay for credit life and/or gap insurance on a vehicle and NEVER pay for the "special coating" or extended warranties that they offer.
Quote:The idea is planning and saving. Think you might want to buy a large ticket item such as a vehicle, home, etc.? The best thing to do is save up money for it. If you don't quite have enough to cover the purchase, at least have enough to cover the depreciation of it (in this case of a vehicle). Then if you do need to finance the balance, a credit union will typically offer better rates and/or payment options.
One thing that I did that floored a dealership one time. They offered a discount on a vehicle ONLY if you used their financing. Let's just say that the vehicle cost after the discount was $35,000.00. I wrote them a check for $28,000.00 as a down payment and told them that I wanted to finance the remaining $12,000.00. Of course, I paid the "loan" off when the first payment came due. The figures are just an example and not the actual figures that we dealt with.
One other thing that I advise against. NEVER pay for credit life and/or gap insurance on a vehicle and NEVER pay for the "special coating" or extended warranties that they offer.
Paying things off in cash is obviously the ideal way to go, but a lot of people don't have that luxury for big ticket items, even with planning.
With money being so cheap to borrow and interest rates so low recently, the argument could also be made that you could get a higher ROI doing other things with your cash than purchasing something outright, especially with something as low as automotive interest rates.
If I have $65,000 cash in the bank and want to purchase a new car, am I better off buying it outright than borrowing the money at 2.x% and picking up a cheap rental property or throwing it in the market and maybe getting a 6% return on it?
Sure, nothing can ever replace the peace of mind of not owing anybody anything, but there are different options based on your goals.
Quote:Paying things off in cash is obviously the ideal way to go, but a lot of people don't have that luxury for big ticket items, even with planning.
With money being so cheap to borrow and interest rates so low recently, the argument could also be made that you could get a higher ROI doing other things with your cash than purchasing something outright, especially with something as low as automotive interest rates.
If I have $65,000 cash in the bank and want to purchase a new car, am I better off buying it outright than borrowing the money at 2.x% and picking up a cheap rental property or throwing it in the market and maybe getting a 6% return on it?
Sure, nothing can ever replace the peace of mind of not owing anybody anything, but there are different options based on your goals.
Certainly, and your age has a lot to do with it. However, think about this for a bit. Why are loans so "cheap" right now? Is real estate really a good investment?
With the way that the economy is right now, I wouldn't want to hold any debt, and I would rather invest money in something that isn't going to fail in the near future. Consumer loans and real estate is going to take a huge hit in the near future. Because money is "so cheap to borrow" right now is in fact what the problem is. When and if the Fed decides to start raising interest rates, the economy is going to have to correct itself.
There is a false sense of security right now. People seem to think that they can get loans, credit cards, cell phone plans, etc. at "cheap" rates all of the time. That's all going to change soon. Once interest rates start rising again, things are going to change. Not only will the cost of consumer loans go up, but also loans that many businesses rely on in order to stay operational. That in turn is going to raise the cost of products and services as well as possibly cost jobs.
Quite frankly, the economy is headed for a recession if not a depression very soon, and it will be on a global scale. The global markets are dependent on the U.S. markets.
Quote:The idea is planning and saving. Think you might want to buy a large ticket item such as a vehicle, home, etc.? The best thing to do is save up money for it. If you don't quite have enough to cover the purchase, at least have enough to cover the depreciation of it (in this case of a vehicle). Then if you do need to finance the balance, a credit union will typically offer better rates and/or payment options.
One thing that I did that floored a dealership one time. They offered a discount on a vehicle ONLY if you used their financing. Let's just say that the vehicle cost after the discount was $35,000.00. I wrote them a check for $28,000.00 as a down payment and told them that I wanted to finance the remaining $12,000.00. Of course, I paid the "loan" off when the first payment came due. The figures are just an example and not the actual figures that we dealt with.
One other thing that I advise against. NEVER pay for credit life and/or gap insurance on a vehicle and NEVER pay for the "special coating" or extended warranties that they offer.
I disagree with this. Depending on the person buying the vehicle and the amount they have up front these services can be of great need.
I'm a former underwriter for a local credit union and I can't tell you how many [BLEEP] stories I've heard from the origination side when a elderly couple living off of social security loses their spouse due to age and they are stuck with a $300 car note with 4 years left on it and can't afford to pay it with only one social security income. I've heard the same number of stories where a young person purchased a new vehicle with no down payment and totaled the car a couple months later and are left with a bill because the insurance wouldn't cover the entire cost of what was left on the loan.
In each instance if the elderly couple would've had the credit life protection the entire loan note would've been paid off and the surviving spouse would've been left with a car paid for free and clear. If only the young person would've purchased the $350 gap coverage the remaining balance of their loan would've been paid off and they could shop for a new vehicle without a $3000 bill sitting on their coffee table.
It just depends on each person. If you have a decent life insurance policy or you put down a decent enough down payment up front then I agree these services won't do you any good. But in today's world the majority of people don't have a life insurance policy big enough to cover the remaining balances on large purchases or they don't have a hefty down to cover the depreciation.
If you are interested in financing definitely do it thru the credit union as others have suggested. The rates are normally unbeatable and if you are interested in the extra coverages also get those thru the credit union as well. Gap alone at a dealership can range from $600 on up and the credit union usually offers it for much less.
Quote:So I am considering getting a car using one of the car buying programs. I am a costco member, so I am trying theirs, plus I am getting some leads from edmunds and truecar. What has been peoples experience with these programs? Any recommendations? It seems like they are more of a way to generate leads for companies, but I want to see what people think and what your experience has been.
To answer your question stay away from these programs. Find a certified pre owned vehicle coming off lease or find a car from Enterprise or Hertz car sales. Former rental cars have been maintained meticulously and you can usually find great deals there. If you do decide to go to a dealership then get your financing up front at your local credit union as it's much easier to negotiate with "the devil" with a pre-approved check in your back pocket. To find the best deal at a dealership you may have to travel a few miles out of town but it's usually worth it. For whatever reason cars seem to be somewhat cheaper down south.
Quote:Do you have to buy new? I always feel that used with very low mileage is the way to go.
I've bought new only once before that lesson was learned. Let other people pay the depreciation cost. With the quality of cars these days, finding a good used car that will last for years just requires a little research and vigilance.
Quote:To answer your question stay away from these programs. Find a certified pre owned vehicle coming off lease or find a car from Enterprise or Hertz car sales. Former rental cars have been maintained meticulously and you can usually find great deals there. If you do decide to go to a dealership then get your financing up front at your local credit union as it's much easier to negotiate with "the devil" with a pre-approved check in your back pocket. To find the best deal at a dealership you may have to travel a few miles out of town but it's usually worth it. For whatever reason cars seem to be somewhat cheaper down south.
I agree with all of this except the rental car thing. I was a road warrior for work earlier in my career and even though rental cars are probably maintained well, people beat the crap out of them, which I was guilty of myself. It may be just a small percentage, but the whole aura of buying a rental car scares the crap out of me.
Also agree about finding one out of town. We got an incredible deal on our current car in Orlando. The salesmen are eager. If you tell them what you are looking for and have some patience, you will have multiple people in the know looking for your next car.
Quote:I agree with all of this except the rental car thing. I was a road warrior for work earlier in my career and even though rental cars are probably maintained well, people beat the crap out of them, which I was guilty of myself. It may be just a small percentage, but the whole aura of buying a rental car scares the crap out of me.
Also agree about finding one out of town. We got an incredible deal on our current car in Orlando. The salesmen are eager. If you tell them what you are looking for and have some patience, you will have multiple people in the know looking for your next car.
There's a comedian that does a skit equating buying a rental car to marrying a hooker...both might look good, but you're going to end up with something that a lot of other people have used the hell out of!!