Toyota upgrade program?

LOL. I get that exact template in my email every week.

 

Same experience here. We can get you in a brand new one for a lower payment! My kind response is have you looked at my truck? Why in the hell would I give you this for that?

 

I've left before when that tactic was used on me. One guy literally only discussed payment amount and how much I could afford a month. We pay cash for our vehicles, but I don't disclose that until we're in financing so it doesn't affect the purchase price. Often you don't get the best deal paying in cash.

 

Yep, it's always best to keep it to yourself until the dealer quotes a price, if you are going to pay cash.

Right now, that upgrade program is an insult my intelligence. Do they not think I'll do my calculations regarding the trade in offer and their suggested monthly payments on a 72 month loan?

 

From a dealers's perspective there are three kinds of buyers'.

In order of profitability (best to worst) they are:

1. The "monthly payment" buyer, that cares about nothing but the amount of the payment;
2. The "what's my trade in worth?" buyer, that cares only about how much the trade is worth;
3. The "what is the bottomline cost cash buyer", that has done their research and just wants to know how much will it cost;

With the first they can toss in all kinds of profit and an 84 month loan to reel in the fish; for number 2 they can toss in the profit and write some silly "trade-in value" number on the invoice. So obviously a "payment/trade" combo would be the best.

Number 3 is a car salesman's worst nightmare, especially if the potential buyer in prepared to get up and walk out if they don't get the numbers the're after--to get the best deal be a number 3.

Don't Get Taken Every Time: The Ultimate Guide to Buying or Leasing a Car, in the Showroom or on the Internet

Must reading for any one buying or leasing a car:



Here is an excerpt well worth a read.

If your library doesn't have it ask them to get it for you...

 

same placement!!

 

Is there really such a thing as an 84 month auto loan?

 

There is, my stupid Ex-Fiance had one on her old car and again on her new Explorer.

 

I figured 6 years would be max. I guess it makes sense though, new car prices are going up.

 

I thought the same thing when I was taking out my first auto loan last month. Car prices are going up and it seems that people are just accustomed to having large amounts of debt.

This is a decent read: https://jalopnik.com/84-month-auto-loans-are-becoming-more-common-because-yo-1825414883

 

Sadly you are the minority. Captialism is brutal on stupid people.

Also, paying $50k for a pickup truck is insane

 

This is badass. After you've negotiated sales prices and tell them about cash do they typically reneg on you? I'd like to hear your stories

 

I have kept the same payment for my last five new vehicles. How? Easy.
1. Buy a vehicle with payments you can afford
2. Pay those payments until you have enough equity in your vehicle to trade for a new vehicle and keep the same payment.

Simple. It might take two years for some vehicles, it might take four years for other vehicles. The trick is to get a vehicle with a high residual value, like a Tacoma or 4Runner. They hold their value very well and you don't lose your ass and have to pay massive depreciation just to drive it off the lot like you would with a Cadillac.

Some vehicles I have kept for two years, some, four years. Never longer than four years though because I buy Toyotas and Hondas. They hold their value well. All you have to do it keep it long enough to trade it in and keep your same payment. I always finance for 48 months but everyone's financials are different.

Bottom line, pick a vehicle you can afford, pick a term you can afford and that is what will dictate how long you keep it before buying a new vehicle keeping the same payments.

 

I always tell them I don't care what the payment is and I'm only concerned with my price OTD and they usually still try to pull out a sheet showing me how down payments and terms will change my monthly payment lol.

 

Nope. But we don't buy new cars that often, so I won't have many stories.

When I bought my truck the finance guy told me how dumb it was to pass up 4 percent financing when I could be making 6 percent or better with the same money in mutual funds. I get it and I understand that, but for us it's a mental barrier of not owing anyone or having the liability of monthly payments.

 

I understand your position for sure, but I am that guy who does it the other way. I get the low or no interest note and use my money in investments to make money at a higher rate of return. I could pay off all of my vehicles tomorrow if needed but why? I feel as long as I have enough to pay off my vehicles if necessary then that's good enough.

 

Next time ask him where the paperwork is for the guaranteed 6% is for the same term your guaranteed to pay 4%

When he says that mutual funds don't guarantee.........

Tell him then you'll pay variable, 2% under the mutual fund rate, as he was suggesting. Up or down, 2%. Mutual goes to 10, youll pay 8. Mutual goes to 3, youll pay 1.

Give him something to kabitz about at the next sales tem rah rah meeting.

 

The 84 month loan is what allows lower middde class to buy $60k vehicles. Only in America!

 

Let's say 4 percent in interest paid and 2 percent (the difference between the 4 paid and the 6 earned) in interest gained on 20k (since my old truck was worth 19k and we had some taxes on my 35k truck), were talking hundreds gained best case scenario. Not thousands. Its not even worth messing around with the paperwork in my opinion.

 

Over the past five years I have $6K more than If I would have just paid cash for the truck, and that is a delta of 5% between the finance rate and investment return. That's also the "safe" money lol. If I use one of my higher return accounts, It could be 2X as much.