Anyone who financed there Legacy...HELP!!!

[Dam itz Lou]

Am I missing something with the interest ? If the interest is 7%, dont I just 7% x the total amount = INT.

 

I dont know where he gets $4349 in interest. Thats almost a 3rd of the car.

[Verwilderd]

it's a simple interest note meaning the interest is calculated daily off of 72 months (or how ever many he did you at...didn't read the papers completely)

[am1awmak]

hehehehe dont sign ...it's missing a hood scoop on the hood....

 

[Dam itz Lou]

Is that the way all dealers do it ? $4349 is way to much no ?

[05pearl]

Am I missing something with the interest ? If the interest is 7%, dont I just 7% x the total amount = INT.

 

I dont know where he gets $4349 in interest. Thats almost a 3rd of the car.

 

No, it's compound interest, not simple interest. 7% for 72 months is not cheap.

[TPLGT]

Car Loans are amortized....the total interest is over the life span of paying on the car.

[FJ60]

I used to do loans (albeit 20 years ago). I've never heard of a compound interest auto loan. Every auto loan I worked on was simple interest. A 7% rate (or whatever they are charging you) is annually based, but calculated daily. The math is pretty straightforward for each month's interest: (principal) X (annual interest rate) / (365) is the daily amount you're charged. You then multiply that amount by the the number of days you held that balance. So if you carried $15,000 for 30 days @ 7%, your daily interest charge is: (15000)(.07) / 365 = $2.88. Whatever amount you pay, $86.40 ($2.88 x 30) goes towards your interest, and the remaining goes towards the principal. The process now repeats, but now it's based on your new balance. Just taking 7% of the loan amount does not take into account the multiple years you carry the loan nor the decreasing balance throughout the term of the loan. IIRC, it varies by state whether banks can charge interest on late charges or unpaid interest on loans like a credit card account.

[BruceBruce]

IIRC, the wheel bearings had a TSB issued, and are now covered to 100K. The extended warranty is crap, there is a $100 deductible for any warranty work done under the Suburu extented warranty. So I am in the other boat, I have only had one item fixed under the extended warranty... Cost me $100, total savings $75. Not worth the 2K I paid for it *sigh*

only the right rear is covered under the extend warranty, or maybes its both rears but i know the fronts are not covered in the extended warranty. I brought my car in for them to fix under warranty and they would only do the rear one. Then said i would have to pay 370 for the front to be fixed. F that. Bought the wheel hub from fredbeansparts.com for 133 shipped to me instead of the 193 my dealership wanted and am doing it myself.

[Dam itz Lou]

I used to do loans (albeit 20 years ago). I've never heard of a compound interest auto loan. Every auto loan I worked on was simple interest. A 7% rate (or whatever they are charging you) is annually based, but calculated daily. The math is pretty straightforward for each month's interest: (principal) X (annual interest rate) / (365) is the daily amount you're charged. You then multiply that amount by the the number of days you held that balance. So if you carried $15,000 for 30 days @ 7%, your daily interest charge is: (15000)(.07) / 365 = $2.88. Whatever amount you pay, $86.40 ($2.88 x 30) goes towards your interest, and the remaining goes towards the principal. The process now repeats, but now it's based on your new balance. Just taking 7% of the loan amount does not take into account the multiple years you carry the loan nor the decreasing balance throughout the term of the loan. IIRC, it varies by state whether banks can charge interest on late charges or unpaid interest on loans like a credit card account.

 

Appreciate that. Im definitely gonna pass unless I could get a cheaper APR. Me giving the dealership basically a 3rd of the car worth is a bit to much.

[__raj]

Visit your local credit union even bank. They do not screw you over during car loans. Basically using a dealer for any financing is setting yourself up for some serious pain unless they offering a good/low rate usually from car maker backing(new ones).

 

My Brother in Law is in auto business as finance director of major dealership and states that majority of money is made on financing, extended warranties and whatever else they throw at buyer more than purchase price.

 

FYI, dealer and bank at least in my state can charge 3% over the real rate you are eligible for. So the real rate is say 3.99% but bank and dealer split 1.5% each on up selling the interest rate and charging you 6.99%. The certified piece being thrown at you is pure selling BS to trick and confuse the buyer.

 

Visit your local Credit Union and find the "real rate" you are eligible for.

[Verwilderd]

^ the certified part is legit in that if you get the car certified, Subaru motor finance will offer a better rate (assuming you have good credit).

[Theride]

dont fear...i got my 2.5 there in march and its the same bull. granted i got a 09 which was 15+. its the same interest rate i got 6.9 with it being certified. its cheaper than the 9.7 i was getting at capital one bank. i took the deal because i am almost 2 years out of bankruptcy and that it was good enough to manage the payments.

 

but if you havent signed the paperwork as of yet, make sure you bring your own calculator and do the numbers manually. they use a computer and i wish i had brought my own calculator with me. plus i was in a rush.

[Guest JessterCPA]

xxx

[dease42]

So I made another trip out there and I see where's the $3000 difference.

 

Interest is $4349.94 :spin:

 

Not certified...

 

http://i39.tinypic.com/fa08y9.jpg

 

Certified...

 

http://i40.tinypic.com/5n40t0.jpg

 

Well, first off, from what I can see here, the only differences between "certified" and "un-certified" are 2 things:

1. You have an Xtended warranty on the "certified" sheet, that you don't on the un-certified - Are you sure it's actually "certified" and that's not just what they're calling their xtended warranty? Be wary of wierd definitions.

2. The sales tax is MUCH higher in the certified (may be because of the added warranty costs).

 

Also, you've got the "ACCESS" fee of 200 (I have no idea what that is, I wouldn't pay it), and a document fee of 300, which oddly enough gets lumped under a dmv fee?!? I would flat out refuse to pay EITHER of those, unless there's something different about the registration where you are, but the document fee (I'm pretty sure) has NOTHING to do with registering the car, but with a dealer fee... I have never paid a dealer/document/delivery fee in any of the cars I've bought... ever.

 

Just based on what you've described, and looking at the paperwork, I would avoid this place (my 2c...). I don't think the interest is all that bad, if you follow the right formula, it seems about right.

 

One last piece of advice (especially if you take out this large of a loan) - GET GAP INSURANCE - but don't get it through the dealer...

[dease42]

^ the certified part is legit in that if you get the car certified, Subaru motor finance will offer a better rate (assuming you have good credit).

 

Didn't see this, I didn't realize that was possible.. good to know

 

Still, doesn't it seem kind of odd that "certified" = "xtended warranty"? Maybe not...

[GEE-OTTO]

Here is good advice DONT DO IT JP Chase IS a terrible bank period. walk away from this and next time never tell them you want to put cash down up front the "deal" isnt made by the scum bag selling you the car its by the financial institution so try to get a loan by going right to the bannk and inquiring you will get a better rate, you WONT get shafted in the arse sans lube like you will at a Stealership. I was told when buying my 08 2.5i that:

 

$23600 (this was in 2008) if I put $2000 down my payments would be $508 for 72 months total cost of car around $36800 I was like hmmmmmmmmm NO looked at the paper work 16.04 APR via JP and the dealer had a clause that released all rebates to them totaling $4500.

[09DgmLGT]

Walk, if for nothing else the $500 for NYS DMV fee is moronic. I lived there for 10+ years (1999-2009) and I NEVER saw any fees that high for my cars or my parents cars (new or used).

 

I bought my '01 Prelude from my brother-in-law and I paid 7% Clinton County tax on it but the plates were transferred from my old car (well < $100) and the registration wasn't more than $70 every 2 yrs the 5 yrs I owned that car.

 

So I'd love to know where that $500 is coming from or going for that matter.

[dvran]

That's why you have always figure out how much a new Legacy will be compared to a used one. if you go the whole term, you'll pay almost the amount of a new car because the interest is so high. Factoring in no warranty and mileage, you're at a new Legacy. Look at what Subaru offers. I got my Legacy for 1.9% for 48 months in 2007. Anything less than a 3.9% financing rate is a rip.

 

Save your money and get a new car with an awesome financing rate. Toyota is practically giving away cars right now with a 0% rate and rebates. Shop around.

[NORULZleggy]

WalkKKKKK I got my 2.5I for 15K with 25K miles and they tried to get me to buy this 3K subie extended warranty I was like no that is ok, Now my car has 60K and if you take care of it, you will have no problems.

[Dam itz Lou]

Well, first off, from what I can see here, the only differences between "certified" and "un-certified" are 2 things:

1. You have an Xtended warranty on the "certified" sheet, that you don't on the un-certified - Are you sure it's actually "certified" and that's not just what they're calling their xtended warranty? Be wary of wierd definitions.

2. The sales tax is MUCH higher in the certified (may be because of the added warranty costs).

 

Also, you've got the "ACCESS" fee of 200 (I have no idea what that is, I wouldn't pay it), and a document fee of 300, which oddly enough gets lumped under a dmv fee?!? I would flat out refuse to pay EITHER of those, unless there's something different about the registration where you are, but the document fee (I'm pretty sure) has NOTHING to do with registering the car, but with a dealer fee... I have never paid a dealer/document/delivery fee in any of the cars I've bought... ever.

 

Just based on what you've described, and looking at the paperwork, I would avoid this place (my 2c...). I don't think the interest is all that bad, if you follow the right formula, it seems about right.

 

One last piece of advice (especially if you take out this large of a loan) - GET GAP INSURANCE - but don't get it through the dealer...

 

Access fee is VIN etching, which i dont want.

 

Ya the $300 he told me was a state law in CT. I forgot exactly what he said.

 

DOCUMENT FEE...Got this from yahoo answers...

 

i am actual car dealer in ct the fee you payed is true, there are reg fees of 75 new plus 40 emissions, 10 lien fee and a 25 title Fee plus a 5 dollar greenhouse gas fee, plus the doc fee is not negotiable its a fee the dealer gets by state law for servicing registration and handling paper work for the lenders. none of that stuff is free to us and as far as the dmv fees we pay an additional 20 for having the system there so we can reg you in house. you got by just fine, my dealership charges 329 doc fee.

[Verwilderd]

Didn't see this, I didn't realize that was possible.. good to know

 

Still, doesn't it seem kind of odd that "certified" = "xtended warranty"? Maybe not...

 

When you certify a vehicle it comes with an extended warranty....typically powertrain and from there you can opt to switch that to a bumper to bumper.

 

But for when a Subaru is certified, it goes through the shop and receives a 152pt inspection and the warranty is extended. As a result the vehicle price is slightly higher (because the certification process costs money) but Subaru will offer a lower rate which will help offset the cost.

[Verwilderd]

ooo and if it's not already on it, the cost for a Subaru 6/100K bumper-to-bumper warranty with $100 deductible is roughly $275 on a certified car. You could try to get that put in, but they will mark it up. I would say it's worth it to buy if you can find a tactful way to get the finance manager to sell it to you near cost (it's a business and they are allowed to make money off you).

 

Just realize that this place is trying to make some money on the deal. There's nothing wrong with that and so you need to keep that in mind. If they are shady about things and you don't trust them, don't buy from them. But if you do your research on the car, look up certification interest rates (trust me, they're out there...just need to search) and everything is on par with 3rd party sources, buy the car. Quit worrying about whether they are making money off you. Just make sure you get the vehicle you want and you are comfortable with the price.

 

Past that, you really don't seem to trust them and if that is truly the case, then you should walk away. Give them a chance to make it right and explain what each fee is and make sure all the numbers are clear. If they aren't then walk. Most people are never comfortable asking the finance manager to explain (and dealers know this) numbers. If there are errors, you'll know it when he's doing the math in front of you.

 

To the OP: If you have questions, feel free to pm me and I will try to help in anyway I can. You are in a different state, so there may be things I don't know, but on the whole, I will be more than happy to help!

[Dam itz Lou]

PMed you.

 

I appreciate everyone who helped me with this. I got alot of thinking to do the next 2 days.

[Pyrojones]

Its better to look around and make the dealers work for you and be on your terms. I know its hard to lay off a beautiful car such as that but if you pull the trigger too soon you will grow to hate not only your self but your car. Get the terms and price YOU want, if this car wont allow that to happen it may just be time to walk and look some other place.

Credit Unions are the best way to go, I wish I would have followed all of my own advice.

[Verwilderd]

I've written you back. I will check into everything tomorrow when I'm at work. Please send another pm if you haven't heard from me by the afternoon as sometimes I tend to forget things. I run the Internet Department at my store (at least for the time being) so I'm usually running around like a chicken with my head cut off.