New Tacoma OR

My SIL just bought a new Sequoia and had her financing lined up at a credit union - 2.2% for 72 months and the dealership got her 1.89% at the same credit union! That's nuts! I did hear the finance guy tell her cuz her credit was above 850, he was able to pull some strings and get her that rate.

 

Nice! What was her purchase price, DP, and final payment like?

 

She went with a MGM nightfall - got them to down to $64200k - MSRP was $68756 or something like that. Dropped $18k down and her payment is $722 OTD. It's sweet looking and she loves it. My wife's jealous and won't shut up about wanting a new ride

 

Care to explain why not? Never heard this before.

All of the banks/credit unions I've spoken to offer their best rate once your credit score is over 750. From there it's quoting around and going back and saying x offered me lower, can you beat it? That's been my experience at least.

To OP, a lot of good advice in this thread. I'm hoping by now you have an out the door price. A buyer's order or similar document would be a good idea to obtain if you haven't already. This will tell you the vehicle price, processing fee, trade in, taxes, license, title, registration, and any other charges, MINUS your deposit and any amount you agreed to put on it as a down payment for your total OTD. You can always (and should) negotiate further once the vehicle arrives and you test drive it, but this will be good to provide to lenders and so that they don't try to drive up the price once it arrives due to whatever other circumstances.

A word on interest rates from Toyota, the finance guy offered me a percent off if he could sell me the add-on warranty. I don't remember how the conversation ended up going from there, but I ultimately walked out with the lower rate, and the warranty, for less than the OTD price I had originally discussed with the sales guy prior to vehicle arrival. I'm not sure how I got there, and I probably could have saved more money by rejecting the warranty, but here we are.

And congrats on your new truck! Post pictures when you get it.

 

I've driven into my kids that Credit Scores are king. I've had crazy-high credit scores for decades and it's really pretty simple...
Don't get in over you head ( asset to liability ration ) and pay your damn bills on time better yet 3-5 days before they are due
and never pay the minimum, I think I'd either pay credit cards completely or at least 40% or higher. Of course I'm a cheap bstard
and never spent much to begin with.

 

Check your credit score and then check your local Credit Unions for rates. That is the best option for best finance price. Do not finance through the dealer for sure and I would stay away from generic banks.

 

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Almost all Credit Unions have cross-collateralization clauses within their contracts. Most hapless folks agree to these hyper -aggressive terms when they open accounts without reading the dang fine print. If these folks default on their truck loan through them, they can automatically deduct the assets from any other holdings they have within the credit union. They do not first have to file suit, win the suit and thereafter collect on the judgment. Most regular banks and lenders do not have such clauses. With regular banks, if you do default on your truck loan, they can't touch any other assets until obtaining a judgment and executing on it. This is a process that takes 60- 180 days giving you time to withdraw any and all remaining funds to use for whatever purposes you need.

Seen this happen many , many times. What's insanely unfair is that it should be an independent tribunal that gets to determine if a person defaulted on their loan, not some wanker banker in a credit union that can do so at the flip of a switch. You'd be plum-shocked how many ways a credit union member can default on a loan.

 

Very helpful information, thanks.

 

Congrats! My situation was nearly identical to yours! I took delivery of a ‘21 OR a week ago. I financed through BOA who had better rates than my credit union. Upon applying online I was immediately approved, followed a couple of days later by a call by a BOA rep who told me my dealer is a participating BOA dealer, meaning just bring the approval letter.
One of the reasons dealers like to finance is the ability to wrap “driver-value additions” (aka overpriced worthless options) into your loan.
“Ceramic coating will last you a lifetime but will only cost you an additional $32/ month....”

 

Hello Welcome aboard

 

When they try to sell me the extended warranties, I have 2 answers. 1) "I wouldn't be buying an XXXX if I thought I needed an extended warranty." If that doesn't work then I use 2) "How long do I have to decide about the extended warranty?" (And the answer to #2 is until your 3/36 is up, so you really have up to 3 years to buy the extended warranty).

 

If you haven't already, I would recommend asking if they have a dealer mark up or dealer installed options that you HAVE to buy. I bought my taco about a month ago here in California. I called just about every dealer between Santa Barbara to San Diego. They all had 5k to 10k dealer markup. I ended up buying mine out of Temecula. The did not have a dealer mark up but they did have a couple of dealer installed options that you HAVE to buy in order to get the truck. I went with them since it was still less than 5k and you at least get something for your moneys worth.

 

I've gotten great rates right from the dealerships. In my case they just reach out to the local banks and credit unions that they work with. Each time I've had less than 3% interest rates.

The flip side of the coin is relatives who've also gotten screwed. My fiance got a 4.5% because she had no credit score (even though she had already paid off her student loans in only 2 years). She was lucky to get that because one wanted to offer her 8%. Her parents also got like 4% or so through Toyota financing and they beat the banks at that time.

 

Sometimes they’ll work the sales price a little to get you the same ‘payment’ as a lower interest rate alternative.

That’s well and good, but the amortization curves might be slightly different. At current rates, it’s probably not worth worrying about.

 

The trick to not defaulting on any car loan is to not buy over your head in the first place.

Have the money in other forms of savings or investments that you could tap to pay off said loan in a pinch if you get laid off or other.

I realize everyone does their money in their own way. Saving up the money or investing up the money may not be possible for some that choose to live on the edge of their paychecks just so they can always have the latest and greatest toys in life. It works, but creates unnecessary risks IMHO.

 

Toyota Financial Service actually is very easy to qualify, 690+ credit score should do to get those special APRs.

 

If I can't put 50% or more down I don't buy - and if I don't have twice that much in reserves I don't buy.

I dropped 64% down on my SR5 and have twice that amount laying up in savings and 3 times that amount
setting in a dormant 401K... boy would I love to cash that out it's doing nothing for me but it would shoot us
up into a bigger tax bracket. Guess I could piece-meal it out.

Just before covid hit I was shown-the-door after spending 15 years at a company because they said policy
on working from home changed ( duh )... had I still been working I would have paid cash for the SR5...
so I filed for so-so-security and spend my days doing what I do best, which is nothing at all. I got a real
knack for it LOL...

Put as much down as you can, finance for as few years as you can, and stash every friggin loose nickle
you find.

 

Another good tip, if you do let the dealership pull your credit make sure to tell them to only run your credit with one bank. Otherwise those yahoos will pull your credit score multiple times, with multiple banks.

It is a myth that multiple credit pulls within a 45-day window will only hurt your score once. Every hard pull will drag your score down and make your credit file look bad (source: I worked for Bank of America and my wife is an auditor for a credit union). This is why I always bring my own financing unless I know the dealership is running a special that my credit qualifies for.

Don't just start give away you SS# and start signing for things. Execute a well thought out plan that is going to protect you. Specify exactly what you want when dealing with dealer and bank staff.

I tell the staff straight up I don't want any extras and I want the process to be as quick as possible, that I've bought a lot of cars and I know how the game runs. My experience is that they get straight to the point when you are upfront with them like this.