Financing a used car- HELP!!

Ancalagon

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Feb 23, 2010
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@Hitchcock

Let's look at the quotes you found:
In such cases, shopping around will have little or no impact on a credit score.

My my.... that seems to agree with what I said on the previous page? Surely it is wrong?

Most scoring models take the appropriate steps to make sure your score is not lowered because of the multiple inquires that might occur in a specific time period as a result of shopping for the best terms in an automobile loan, home loan, or insurance coverage.

Uhhhhh I'm confused. You say that I am wrong, but the quotes you find support my statements? And yet you call me a "clever guy" and still disagree with me.
 

Hitchcock

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Does not matter, it is your credit record, you do with it what you want. You have the information you need to make an informed decision.
 

Hitchcock

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Don't get taken in by this "two types of F&I" BS either - you will either be dealing with a financial person from the bank, or one from the dealership - they are both doing exactly the same work, however, one will be bank specific, and the other will be able to look at all the banks and shop around for you.

-----

you will either be dealing with a financial person from the bank, or one from the dealership .

Is that not what I said? You drunk?

To the contrary, what everybody told you here -

Firstly, there are two types of F&I's:

On most reputable dealership floors you will find the bank's own F&I. Some dealerships may have more than one F&I from more than one bank on their floor. These F&I's work for the bank and get paid by the bank.

Then you get independent F&I's - people who done the course and qualified and are appointed by the dealership. They work for the dealership and they get paid by the dealership.


In the motor industry, for those who really worked there before, an F&I employed by the dealership is known as an independent F&I.

LOL :)
 
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Fazda

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-----



Is that not what I said? You drunk?




In the motor industry, for those who really worked there before, an F&I employed by the dealership is known as an independent F&I.

LOL :)

No I'm not drunk, and you are simply trolling as usual.
 

Pitbull

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:D LOL - whatever. Your posts above don't make sense, whatever the reasons for that may be...

I have shopped around for interest rates on vehicles, home loans and even loans before. NEVER have my credit score been affected negatively. Not paying an account for 1 month will set you back way more than a couple of hundred enquiries :D
 

Hitchcock

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I have shopped around for interest rates on vehicles, home loans and even loans before. NEVER have my credit score been affected negatively. Not paying an account for 1 month will set you back way more than a couple of hundred enquiries :D

Have you checked your physical credit score before and after? Not listed as a bad payer or anything, but your credit score. Also like I said, your score goes down after the second and third enquiry, but is restored when you sign the agreement and it is reported to the credit bureau. Most people don't even know about this.

I can show credit reports, especially fraudsters who gets enquiries by 4 banks and their score dropped by about 50 points - not because of fraud, but enquiries made by banking institutions where they tried to apply for home loans and vehicle finance and the agreements were not signed.
 
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supersunbird

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Have you checked your physical credit score before and after? Not listed as a bad payer or anything, but your credit score. Also like I said, your score goes down after the second and third enquiry, but is restored when you sign the agreement and it is reported to the credit bureau. Most people don't even know about this.

I can show credit reports, especially fraudsters who gets enquiries by 4 banks and their score dropped by about 50 points.

But Experian and Transuinion, as per the links you posted, says it doesn't affect it or affects it very little... are you trying to argue against that again?
 

Hitchcock

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But Experian and Transuinion, as per the links you posted, says it doesn't affect it or affects it very little... are you trying to argue against that again?

Not at all. I know how the algorithm works.

When you get a certain number of enquiries in a certain time frame, your score automatically drops. Their system does this. But, if you sign the agreement within a certain number of days, the algorithm pushes your score up again. If not, your score will remain lower.

The problem is that people do not look at their credit scoring. They only see if they are blacklisted. Get a proper credit report indicating your scoring. Try to apply for a loan at three banks and get that same report the day after that. You will see what I mean.

It does not affect you in such a manner that you cannot apply for credit, but if you have a score of 820 and they take off 50-80 points (due to shopping around) - and you apply for credit where their system requires 800 points, that will affect you. That loan or finance will probably not be granted to you.
 
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Foxhound5366

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Oct 23, 2014
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Hi Alice

Has somebody shown you this useful tool that you can play around with to your heart's content?
WesBank Repayment calculator: https://www.wesbank.co.za/partners/calculators/repayment.xhtml?siteID=wesbank

Just plugging in the exact info you've mentioned, it seems clear that the F&I is adding in at least R6 000 for 'on the road' costs ... that's assuming you didn't select any extras along the way that you've forgotten to mention. It's not unusual to pay that much (it's how dealerships make a lot of their money), but you can usually bargain them down to a figure you're more comfortable with (and end up with a sub-R2000/month repayment).

Most people advise against getting a fixed interest rate, because you're liable to actually end up paying more in the long-run than you would otherwise. Banks tend to have a better idea what the interest rate is going to do in the future than you do, so they package all of that fluctuation in with a little margin for safety ... you're highly unlikely to 'save' money unless something extreme happens (like World War 3).

The one thing I'd suggest is ask the F&I to put an application through to MFC instead. I've used them for my last two cars, and they generally give the best deals. They're owned by Nedbank, not that it matters much, and my interest rates have usually been around the 12% mark (and that's even with the added risk of adding a residual payment to the deal).

Generally you don't want to over-think a secondhand car too much ... there's nothing worse than losing one you liked when it gets sold out from under you, and having to start the process all over again. Just keep focus on the big picture, and don't try quibble over fractions of a percent which ultimately cost R100 here or R200 there. Sure you CAN, but do you need that hassle in your life? I've always committed to a ball-park budget before, and accepted so long as the offer falls within my accepted range.
 

Ancalagon

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Not at all. I know how the algorithm works.

When you get a certain number of enquiries in a certain time frame, your score automatically drops. Their system does this. But, if you sign the agreement within a certain number of days, the algorithm pushes your score up again. If not, your score will remain lower.

The problem is that people do not look at their credit scoring. They only see if they are blacklisted. Get a proper credit report indicating your scoring. Try to apply for a loan at three banks and get that same report the day after that. You will see what I mean.

It does not affect you in such a manner that you cannot apply for credit, but if you have a score of 820 and they take off 50-80 points (due to shopping around) - and you apply for credit where their system requires 800 points, that will affect you. That loan or finance will probably not be granted to you.

The end result is that her score will be restored to what it was, because she needs finance. So, in fact, there is no material difference to her credit score. If she decides not to take finance, then her score may be affected, for a month or two. Can shopping around really make as much as an 80 point difference on your score? Can you prove that?

Besides which, lets not forget that credit score is not the only thing taken into account. Solvency, income and expenses are also taken into account, as are age and other demographic information. When you apply for credit, the credit report that they see will list what has impacted your credit recently. They will see that your slightly lower score is due to other credit applications - which should not come as a surprise to them.

You are the only person arguing this. You are the only person that thinks it is bad to shop around. You are the only person who will just take whatever interest rate you get. Do you know much money I have saved by shopping around and getting a better rate? LOTS. I'm not the only one.
 

SykomantiS

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May 7, 2012
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3,609
This is an interesting question, as the exact same thing happened to me last year. In the end the stealership just flat-out refused to sell me a car when I tried to get finance on my own from my bank- it got approved for a lower interest rate than what they could get me. And I refused to take the car knowing I could get a better interest rate. Everbody loses.

What gets me though is that nobody can confirm if the stealerships actually do get kick-backs negotiating the interest rates. Everybody says they do, they obviously say they don't, but no one has given me concrete proof one way or the other. (btw, what does F&I stand for?). Personally, I call them stealerships for a reason. I am fed up and tired of being offered these high interest rates.

My advice to OP, if you don't like the finance offer, move along. Plenty of other stealerships and plenty of other cars to choose from. They are not doing you any favours, despite what they might think and what they tell you- took me a while to learn this lesson.

Good luck and happy car hunting.
 

Hitchcock

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This is an interesting question, as the exact same thing happened to me last year. In the end the stealership just flat-out refused to sell me a car when I tried to get finance on my own from my bank- it got approved for a lower interest rate than what they could get me. And I refused to take the car knowing I could get a better interest rate. Everbody loses.

What gets me though is that nobody can confirm if the stealerships actually do get kick-backs negotiating the interest rates. Everybody says they do, they obviously say they don't, but no one has given me concrete proof one way or the other. (btw, what does F&I stand for?). Personally, I call them stealerships for a reason. I am fed up and tired of being offered these high interest rates.

My advice to OP, if you don't like the finance offer, move along. Plenty of other stealerships and plenty of other cars to choose from. They are not doing you any favours, despite what they might think and what they tell you- took me a while to learn this lesson.

Good luck and happy car hunting.

F&I - Finance and Insurance Manager

Yes, if the F&I is a bank employee and the dealership has an agreement with only that bank(s), there is no way the F&I will look elsewhere. Best is to move along.

Yes, rather look for Independent F&I's who look at all banks.

Also, I am sure that there are some financial benefits to dealerships - whatever they may be.
 

Fazda

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Apr 24, 2009
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11,414
This is an interesting question, as the exact same thing happened to me last year. In the end the stealership just flat-out refused to sell me a car when I tried to get finance on my own from my bank- it got approved for a lower interest rate than what they could get me. And I refused to take the car knowing I could get a better interest rate. Everbody loses.

What gets me though is that nobody can confirm if the stealerships actually do get kick-backs negotiating the interest rates. Everybody says they do, they obviously say they don't, but no one has given me concrete proof one way or the other. (btw, what does F&I stand for?). Personally, I call them stealerships for a reason. I am fed up and tired of being offered these high interest rates.

My advice to OP, if you don't like the finance offer, move along. Plenty of other stealerships and plenty of other cars to choose from. They are not doing you any favours, despite what they might think and what they tell you- took me a while to learn this lesson.

Good luck and happy car hunting.

Having worked for several years in a dealership, I can confirm that they DO get a kickback, obviously, the lower the interest rate, the lower the kickback - do your own finance, and there is no kickback at all.

If a dealership insists on you using "their guy", walk away from the deal.

Any dealership that is relying on bank kickback for every deal, is not worth its salt.
 

Pitbull

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Apr 8, 2006
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Have you checked your physical credit score before and after? Not listed as a bad payer or anything, but your credit score. Also like I said, your score goes down after the second and third enquiry, but is restored when you sign the agreement and it is reported to the credit bureau. Most people don't even know about this.

I can show credit reports, especially fraudsters who gets enquiries by 4 banks and their score dropped by about 50 points - not because of fraud, but enquiries made by banking institutions where they tried to apply for home loans and vehicle finance and the agreements were not signed.

Yea, you pay R 100 I think with transunion and you can pull your credit score and your credit profile. :confused:
 
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