Financing

[Hal]

I'm not a bank loan officer or anything even remotely close, but I would think there would be a problem securing a loan on a vehicle that hasn't been delivered in the sense that the bank doesn't have their collateral very easily accessible to reposses if someone is in default on said loan. I don't see that as an option for that reason alone.

But they are not required to pay for the vehicle until its delivered. I don't recall the specifics, but I believe you can sign/pre-approve a car loan, but I believe it must then get fully executed within 60? days. Otherwise you have to reapply and rates might change.

The problem here is compounded by this Ford order fiasco where ETA's are all changing or TBD. If you knew that your truck would be delivered sometime in January, you could secure the loan now.

 

[Kansan]

That brings up another question. If you refuse to purchase for whatever reason, I would guess the only thing you would lose out on is the interest already paid towards the loan?

You wouldn't start making payments until you bought the car. Your loan approval is, depending on the lender, good for 30/45/60 days. Once you buy the vehicle and the collateral is secured the loan starts.

 

[ThugHunter]

But they are not required to pay for the vehicle until its delivered. I don't recall the specifics, but I believe you can sign/pre-approve a car loan, but I believe it must then get fully executed within 60? days. Otherwise you have to reapply and rates might change.

The problem here is compounded by this Ford order fiasco where ETA's are all changing or TBD. If you knew that your truck would be delivered sometime in January, you could secure the loan now.

So basically you'd only be locking in on the loan and rate with the idea you'll have delivery within a certain time frame. That makes sense, but I thought someone was saying the bank said you'd have to start making payments.

 

[Kansan]

I'm not a bank loan officer or anything even remotely close, but I would think there would be a problem securing a loan on a vehicle that hasn't been delivered in the sense that the bank doesn't have their collateral very easily accessible to repossess if someone is in default on said loan. I don't see that as an option for that reason alone.

I am a loan officer (mortgage) and for this auto loan financing you would get approved for the MSRP (usually, some will go higher), say $70,000. You then have, depending on the bank/lender, 30/45/60 days to complete the purchase and set your loan in place. If you do not complete the purchase in that window no harm/no foul but you must re-apply.

If you get approved for a $70,000 car loan they're not going to hand you $70,000 in cash and hope you buy a car. Funds won't be released until you've purchased the vehicle and they have the paperwork to complete the loan.

If you are afraid rates will be raised, and they probably will, apply for your loan around 12/8 (+/-) before the minutes are released and start your waiting period. If rates are increased you'll have your window to get your truck. If it doesn't happen you're in the same spot you were going to be in anyways.

Raising the Federal Funds Rate will have an impact on small bank loans including auto loans.

Pro Tip: The raising of the Federal Funds rate will not have an effect on mortgage rates which are sold on a secondary market and are backed by a security (MBS).

Done.

Now back to memes.

Edit: Dates, the 10th was a Saturday, you want to get this done on the 8th/9th if going this route.

 

[rohardi]

I am a loan officer (mortgage) and for this auto loan financing you would get approved for the MSRP (usually, some will go higher), say $70,000. You then have, depending on the bank/lender, 30/45/60 days to complete the purchase and set your loan in place. If you do not complete the purchase in that window no harm/no foul but you must re-apply.

If you get approved for a $70,000 car loan they're not going to hand you $70,000 in cash and hope you buy a car. Funds won't be released until you've purchased the vehicle and they have the paperwork to complete the loan.

If you are afraid rates will be raised, and they probably will, apply for your loan around 12/10 (+/-) before the minutes are released and start your waiting period. If rates are increased you'll have your window to get your truck. If it doesn't happen you're in the same spot you were going to be in anyways.

Raising the Federal Funds Rate will have an impact on small bank loans including auto loans.

Pro Tip: The raising of the Federal Funds rate will not have an effect on mortgage rates which are sold on a secondary market and are backed by a security (MBS).

Done.

Now back to memes.

Kansan nailed it. I also was a mortgage loan officer in a past life. But in regards to an auto loan, you can get "pre Approved" and locked in for a period of time 30-60-90 days ect, but the lender is not going to let you start paying on a loan or release funds to Ford until they are able to secure a title for the truck. I'm assuming that would not be posable at this stage in the game for most waiting on a truck.

 

[K1llD4shN1n3]

Yea the potential fed rate hike timing with this ****** rollout process really sucks but if a 1% hike breaks the bank is it really something you should be financing or are you better off saving and waiting for the 2018 release?


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[acg90]

Was just setting up the loan with them and they want the first payment by Mid Jan......sigh.

Yeah that didn't bother me too much, I'll just pay it off quicker.

I am a loan officer (mortgage) and for this auto loan financing you would get approved for the MSRP (usually, some will go higher), say $70,000. You then have, depending on the bank/lender, 30/45/60 days to complete the purchase and set your loan in place. If you do not complete the purchase in that window no harm/no foul but you must re-apply.

If you get approved for a $70,000 car loan they're not going to hand you $70,000 in cash and hope you buy a car. Funds won't be released until you've purchased the vehicle and they have the paperwork to complete the loan.

If you are afraid rates will be raised, and they probably will, apply for your loan around 12/8 (+/-) before the minutes are released and start your waiting period. If rates are increased you'll have your window to get your truck. If it doesn't happen you're in the same spot you were going to be in anyways.

Raising the Federal Funds Rate will have an impact on small bank loans including auto loans.

Pro Tip: The raising of the Federal Funds rate will not have an effect on mortgage rates which are sold on a secondary market and are backed by a security (MBS).

Done.

Now back to memes.

Edit: Dates, the 10th was a Saturday, you want to get this done on the 8th/9th if going this route.

You're talking about a pre-approval where you can go to any dealer and purchase any new vehicle within your pre-approval amount during a certain time period. When you already have the VIN # and you're applying for a loan for a specific vehicle, the funds will only be valid to purchase a certain VIN from a certain dealer. So the payment schedule will start as soon as I sign the loan paperwork.

It's pretty simple and the bank isn't risking anything since the check is only valid for a certain brand new vehicle that they know the value too.

Really not any benefits doing it this way except i'll have everything squared away and ready to go immediately when it's ready.

 

[2014RubyRed]

bump