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4x4ord

Alberta

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Joined: 12/23/2010

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Posted: 08/28/19 01:16pm Link  |  Quote  |  Print  |  Notify Moderator

cummins2014 wrote:

troubledwaters wrote:

Huntindog wrote:

Financing is never free. It is rolled into the price when it is offered. If you look hard enough, you can buy it for less if you forgo the "free" financing

Just one of the many games the car biz plays.
With all due respect, you can get a rock bottom deal and great dealer financing also. Actually the dealer doesn't finance anything, they just have good connections at lending institutions that can give the "good credit" buyers really low rates. Every deal I've ever made, I negotiated a rock bottom price first; including all possible incentives. At the same time, I've always went in knowing exactly what the lowest bottom line finance rate I could get on my own was. Then if a dealer could get me a lower rate, I would take it. Sometimes they could beat the rate I got sometimes they can't. You can have your cake and it too; you just have to be as well informed as the dealer.

Works the same way for zero percent financing vs. a cash incentive. Take which ever one works out best when you do the math. It's an either or proposition, not rocket science.



I have to agree with you, but some seem adamant about paying cash. After the deal was done on my last purchase , 2014 Ram 3500 , the loan was 1.69%. It seemed foolish to use my money , maybe WE are wrong, but doing the math on what that money I didn't pay cash on the truck, did a lot better then 1.69%. . Now that truck is paid off, and I still have my money in the investment it was in . Again maybe WE are wrong, but would sure like to see it shown, or explained differently then the way I am figuring it .



Mathematically you're right. If you can do better on your investments then what the bank is charging you for interest then you are money ahead borrowing all you can to invest with. If I ever borrow money for a major purchase such as a real estate purchase I work towards paying it off.... when it is paid off I don't borrow against it to put the money into the stock market. I would rather own my stuff than have the bank own what I call mine and me own what someone else's calls theirs.


2017 F350 SRW Platinum short box 4x4.
B&W Companion
2008 Citation Platinum XL 34.5

troubledwaters

Potomac

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Posted: 08/28/19 02:19pm Link  |  Quote  |  Print  |  Notify Moderator

cummins2014 wrote:

troubledwaters wrote:

Huntindog wrote:

Financing is never free. It is rolled into the price when it is offered. If you look hard enough, you can buy it for less if you forgo the "free" financing

Just one of the many games the car biz plays.
With all due respect, you can get a rock bottom deal and great dealer financing also. Actually the dealer doesn't finance anything, they just have good connections at lending institutions that can give the "good credit" buyers really low rates. Every deal I've ever made, I negotiated a rock bottom price first; including all possible incentives. At the same time, I've always went in knowing exactly what the lowest bottom line finance rate I could get on my own was. Then if a dealer could get me a lower rate, I would take it. Sometimes they could beat the rate I got sometimes they can't. You can have your cake and it too; you just have to be as well informed as the dealer.

Works the same way for zero percent financing vs. a cash incentive. Take which ever one works out best when you do the math. It's an either or proposition, not rocket science.



I have to agree with you, but some seem adamant about paying cash. After the deal was done on my last purchase , 2014 Ram 3500 , the loan was 1.69%. It seemed foolish to use my money , maybe WE are wrong, but doing the math on what that money I didn't pay cash on the truck, did a lot better then 1.69%. . Now that truck is paid off, and I still have my money in the investment it was in . Again maybe WE are wrong, but would sure like to see it shown, or explained differently then the way I am figuring it .
You are not wrong. Over the last 9 years my investments have earned 8.59% average annualized return. I have several loans, the highest is 6.0%, and a few others at around 4.5%. I can pay them off anytime I want to; but why would I. I'm making more keeping my money invested.

Hammerboy

Zeeland, MI

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Posted: 08/28/19 02:21pm Link  |  Quote  |  Print  |  Notify Moderator

So..... anyway, congrats on the truck can't wait to see it.

Dan


2019 Chevy crew LTZ 2500 HD Duramax
2017 Wildcat 29rlx fifth wheel

ksss

Eastern Idaho

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Posted: 08/28/19 08:34pm Link  |  Quote  |  Print  |  Notify Moderator

Being in business and construction specifically what I have learned over the past 25 years is that cash is KING. Cheap interest rates are what makes my method work for me. I put a down payment to get the monthly number that I can live with. Sometimes its a lot, sometimes its not. I do that because when things go bad and they always do, turning equipment or vehicles into cash doesnt work so well. Having cash on hand allows me flexibility during down times. It kept me alive during the 2008-2011 years when other guys were dumping equipment for dimes on the dollar. It also gives me a killer credit rating. The commercial salesman had never seen a credit rating as high as I have. That CR saves me money on insurance, makes bonding much easier and cheaper. So I pay some interest (always less than what a CU advertises because of CR), but in the big picture I get that back, either in actual return, or in peace of mind.

This may not make sense for others, but it works for me.

Now back to the game....I am really interested in hearing a tow report on this new 2020. Test driving them in the lot, only scratches the surface both good and bad. I have seen more and more of these on the road. I think they look good.


2006 GMC 3500 CC 4X4 DRW D/A
2013 Fuzion 342
2011 RZR Desert Tan
2012 Sea Doo GTX 155
2018 Chevy 3500HD CC LB SRW 4X4 D/A
2015 Chevy Camaro ZL1

4x4ord

Alberta

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Posted: 08/29/19 03:44am Link  |  Quote  |  Print  |  Notify Moderator

troubledwaters wrote:

cummins2014 wrote:

troubledwaters wrote:

Huntindog wrote:

Financing is never free. It is rolled into the price when it is offered. If you look hard enough, you can buy it for less if you forgo the "free" financing

Just one of the many games the car biz plays.
With all due respect, you can get a rock bottom deal and great dealer financing also. Actually the dealer doesn't finance anything, they just have good connections at lending institutions that can give the "good credit" buyers really low rates. Every deal I've ever made, I negotiated a rock bottom price first; including all possible incentives. At the same time, I've always went in knowing exactly what the lowest bottom line finance rate I could get on my own was. Then if a dealer could get me a lower rate, I would take it. Sometimes they could beat the rate I got sometimes they can't. You can have your cake and it too; you just have to be as well informed as the dealer.

Works the same way for zero percent financing vs. a cash incentive. Take which ever one works out best when you do the math. It's an either or proposition, not rocket science.



I have to agree with you, but some seem adamant about paying cash. After the deal was done on my last purchase , 2014 Ram 3500 , the loan was 1.69%. It seemed foolish to use my money , maybe WE are wrong, but doing the math on what that money I didn't pay cash on the truck, did a lot better then 1.69%. . Now that truck is paid off, and I still have my money in the investment it was in . Again maybe WE are wrong, but would sure like to see it shown, or explained differently then the way I am figuring it .
You are not wrong. Over the last 9 years my investments have earned 8.59% average annualized return. I have several loans, the highest is 6.0%, and a few others at around 4.5%. I can pay them off anytime I want to; but why would I. I'm making more keeping my money invested.



Do you max out your debt to keep money invested in the markets or do you have some kind of rule or formula that you follow that prevents you from having debt on everything you own? Do you have any desire to be debt free at some point? There have been times that I have considered borrowing money against some of the real estate I own and investing the borrowed money into the stock market. Maybe from a financial perspective it's foolish not to? Once I start down that road I'm not sure where I'd stop.

hvac

Michigan

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Posted: 08/30/19 03:19pm Link  |  Quote  |  Print  |  Notify Moderator

I dunno, this old man at age 63 would still sign on that one for the right truck. Difference is its in my retirement budget with 3% inflation built in. Especially for a tow vehicle, new and reliable is worth it.
Each his own.

Huntindog

Phoenix AZ

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Posted: 08/31/19 01:15am Link  |  Quote  |  Print  |  Notify Moderator

troubledwaters wrote:

cummins2014 wrote:

troubledwaters wrote:

Huntindog wrote:

Financing is never free. It is rolled into the price when it is offered. If you look hard enough, you can buy it for less if you forgo the "free" financing

Just one of the many games the car biz plays.
With all due respect, you can get a rock bottom deal and great dealer financing also. Actually the dealer doesn't finance anything, they just have good connections at lending institutions that can give the "good credit" buyers really low rates. Every deal I've ever made, I negotiated a rock bottom price first; including all possible incentives. At the same time, I've always went in knowing exactly what the lowest bottom line finance rate I could get on my own was. Then if a dealer could get me a lower rate, I would take it. Sometimes they could beat the rate I got sometimes they can't. You can have your cake and it too; you just have to be as well informed as the dealer.

Works the same way for zero percent financing vs. a cash incentive. Take which ever one works out best when you do the math. It's an either or proposition, not rocket science.



I have to agree with you, but some seem adamant about paying cash. After the deal was done on my last purchase , 2014 Ram 3500 , the loan was 1.69%. It seemed foolish to use my money , maybe WE are wrong, but doing the math on what that money I didn't pay cash on the truck, did a lot better then 1.69%. . Now that truck is paid off, and I still have my money in the investment it was in . Again maybe WE are wrong, but would sure like to see it shown, or explained differently then the way I am figuring it .
You are not wrong. Over the last 9 years my investments have earned 8.59% average annualized return. I have several loans, the highest is 6.0%, and a few others at around 4.5%. I can pay them off anytime I want to; but why would I. I'm making more keeping my money invested.


A couple of points to consider. You have 6% loans outstanding... (which is a pretty normal, non subsidized rate) Depending on your tax situation, 8.59% on investments MIGHT be your break even point. To get 8% in todays market involves taking on some risk...(you can lose money) It can't be done in any sort of savings account,
But paying off, your 6% loans results in 6% earnings, garuanteed, risk and tax free.

Any loans that are below market rates are being subsidized one way or another... And no matter how you slice it, the person paying the subsidy is not the bank, or manufacturer, finance co. etc. They do not make money by giving it away. It ultimately comes out of your pocket.


* This post was edited 08/31/19 02:58am by Huntindog *


Huntindog
100% boondocking
2010 Palomino Sabre 30 BHDS
84 gal. Grey. 84 gal. Black
2 bathrooms, no waiting
2020 Silverado High Country CC DA 4X4 Big Dually.



nickthehunter

Southgate, MI

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Posted: 08/31/19 08:13am Link  |  Quote  |  Print  |  Notify Moderator

Huntindog wrote:

...But paying off, your 6% loans results in 6% earnings, garuanteed, risk and tax free...
Clearly a false statement. You get zero earnings by paying a loan off. You get a savings of your own money you are not spending. Same as making a decision not to buy a snickers bar, money not spent, zero money earned. What you did do however, was lose the ability to earn potentially significant gains on the money you just spent to pay off that loan. And remember, you still have the ability to pay off the loan any time your gains no longer justify having it. In the meantime, you can gain very real earnings on which I gladly pay the tax, as I laugh all the way to the bank. My tax on 8.59% earnings is less than 2%.

* This post was edited 08/31/19 08:26am by nickthehunter *

ksss

Eastern Idaho

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Posted: 08/31/19 08:32am Link  |  Quote  |  Print  |  Notify Moderator

Who is paying 6%? The ZR2 I picked up a couple weeks ago was 3.6 from a CU. The advertised rate was still below 4%.

Me Again

Sunbird(Wa)/snowbird(Az)

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Posted: 08/31/19 08:53am Link  |  Quote  |  Print  |  Notify Moderator

hvac wrote:

I dunno, this old man at age 63 would still sign on that one for the right truck. Difference is its in my retirement budget with 3% inflation built in. Especially for a tow vehicle, new and reliable is worth it.
Each his own.


It is best to go into retirement with newer vehicles and RV's that are paid for!

Having no bills for such things makes one sleep better at night.


2015 RAM 3500 CC SB SRW Our Rig New 2017 Bighorn 3575el. Commuter trailer 2019 Laredo 225MK. Retired and enjoying it!


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