jcwls3
Well-known member
- First Name
- Jarrod
- Joined
- Nov 5, 2023
- Threads
- 2
- Messages
- 68
- Reaction score
- 115
- Location
- Midlothian, TX
- Vehicle(s)
- 2020 Porsche 911 Carrera S
There won’t be six rate cuts from the federal reserve this year. Jerome Powell has made it explicitly clear they will hold the line until they are certain inflation is in fact retreating for good. Their target rate is in the two percent range. We won’t see that until late this year, if all goes to plan.
The worst possible outcome would be a few rate cuts, followed by a return of inflation. That’s pure economic cancer. They will be certain inflation is stabilizing into remission before any real moves are made.
Car loans will stay on the higher end of things for some months yet — depending on credit and terms, somewhere between 4.5 and 10 percent-plus. The majority of buyers with good credit, stable employment and reasonable loan-to-value (LTV) will be able to obtain rates in the high five / low six percent range.
I do have a tip that’s been helpful to me several times over the years. Dealers are typically far more lenient on pricing if you take out a loan with their manufacturer’s finance arm, i.e. Toyota Financial Services in this case. They often receive payments for selling those loans, which of course are never disclosed nor passed on to the buyer. But that money can create transactional flexibility.
Most recently, we bought our college-age daughter a new Acura TLX. We went in knowing we’d end up paying cash one way or another, and told the dealer that. They offered to knock off several thousand dollars if we would instead take out a loan through Acura Financial Services. There were no fees for the loan, and most importantly no prepayment penalty after three months. So we wrote a check for the maximum the loan arrangement would allow, then took the discount and paid off the loan a few months later. The costs of a few months’ interest was far offset by the large upfront discount offered.
You could do the same thing without paying cash. Take their best bottom-line price using captive financing relative to cash or an outside loan (key point: tell them you are paying cash at the outset, either lying well or actually meaning it); confirm the terms include zero fees or prepayment penalty; buy the car; then shop for better terms (it usually won’t be hard unless promotional financing is offered, which it won’t for the 2024 Tacoma) and swap one loan for another.
You almost certainly won’t get a discount off MSRP on a new Tacoma. But you might very well be able to parlay it into the dealer removing any “required” add-ons, if your dealer is doing that sort of thing, or otherwise adding additional post-sale goodies (free oil changes, extended warranties, comped window tint, etc.)
The worst possible outcome would be a few rate cuts, followed by a return of inflation. That’s pure economic cancer. They will be certain inflation is stabilizing into remission before any real moves are made.
Car loans will stay on the higher end of things for some months yet — depending on credit and terms, somewhere between 4.5 and 10 percent-plus. The majority of buyers with good credit, stable employment and reasonable loan-to-value (LTV) will be able to obtain rates in the high five / low six percent range.
I do have a tip that’s been helpful to me several times over the years. Dealers are typically far more lenient on pricing if you take out a loan with their manufacturer’s finance arm, i.e. Toyota Financial Services in this case. They often receive payments for selling those loans, which of course are never disclosed nor passed on to the buyer. But that money can create transactional flexibility.
Most recently, we bought our college-age daughter a new Acura TLX. We went in knowing we’d end up paying cash one way or another, and told the dealer that. They offered to knock off several thousand dollars if we would instead take out a loan through Acura Financial Services. There were no fees for the loan, and most importantly no prepayment penalty after three months. So we wrote a check for the maximum the loan arrangement would allow, then took the discount and paid off the loan a few months later. The costs of a few months’ interest was far offset by the large upfront discount offered.
You could do the same thing without paying cash. Take their best bottom-line price using captive financing relative to cash or an outside loan (key point: tell them you are paying cash at the outset, either lying well or actually meaning it); confirm the terms include zero fees or prepayment penalty; buy the car; then shop for better terms (it usually won’t be hard unless promotional financing is offered, which it won’t for the 2024 Tacoma) and swap one loan for another.
You almost certainly won’t get a discount off MSRP on a new Tacoma. But you might very well be able to parlay it into the dealer removing any “required” add-ons, if your dealer is doing that sort of thing, or otherwise adding additional post-sale goodies (free oil changes, extended warranties, comped window tint, etc.)
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