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My quote for a monthly charge doesn't make sense. They said I miss the tier 1 credit rating so will likely get 6-7% interest rates and a monthly payment of $322 for 60 months.

My trade in is worth $8000.

So according to Honda I'm spending $27,320 on my CR-Z.... What am I missing here?
 

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^What's the hold up? You got pix in your sig and avatar!
again, not my car... that's the Euro model and i made that sig/avy months ago... even b4 it came out in Europe :popcorn:
My quote for a monthly charge doesn't make sense. They said I miss the tier 1 credit rating so will likely get 6-7% interest rates and a monthly payment of $322 for 60 months.

My trade in is worth $8000.

So according to Honda I'm spending $27,320 on my CR-Z.... What am I missing here?
maybe they gave you a quote w/o factoring in your trade? how upside-down are you on that trade if at all? you don't have to answer if this is personal for you... but these are some of the questions to ask...
 

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My quote for a monthly charge doesn't make sense. They said I miss the tier 1 credit rating so will likely get 6-7% interest rates and a monthly payment of $322 for 60 months.

My trade in is worth $8000.

So according to Honda I'm spending $27,320 on my CR-Z.... What am I missing here?
You are financing $16,200 for 5 years at 7%. this works out to a monthly payment of $322.76/month.

If your trade was worth $8000, then you are paying a total of $24,200. The additional $3120 is the interest on the loan.
 

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You are financing $16,200 for 5 years at 7%. this works out to a monthly payment of $322.76/month.

If your trade was worth $8000, then you are paying a total of $24,200. The additional $3120 is the interest on the loan.
I'm not a finance major so here is my math:

$16,000 X .07 = $1134
Add to finance figure = $17,334
Divide by 60 = $288.90

So the extra $33.86 a month is just an interest charge on top of financing?

maybe they gave you a quote w/o factoring in your trade? how upside-down are you on that trade if at all? you don't have to answer if this is personal for you... but these are some of the questions to ask...
My Civic is paid off. The value of the car is included on my purchase order form. I wasn't aware they also charge additional interest on top of interest already on a loan :angry:
 

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I'm not a finance major so here is my math:

$16,000 X .07 = $1134
Add to finance figure = $17,334
Divide by 60 = $288.90

So the extra $33.86 a month is just an interest charge on top of financing?



My Civic is paid off. The value of the car is included on my purchase order form. I wasn't aware they also charge additional interest on top of interest already on a loan :angry:
Is your interest rate 7% for 5 years or 7% per year in the 5 years term?
 

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I'm not a finance major so here is my math:

$16,000 X .07 = $1134
Add to finance figure = $17,334
Divide by 60 = $288.90

So the extra $33.86 a month is just an interest charge on top of financing?



My Civic is paid off. The value of the car is included on my purchase order form. I wasn't aware they also charge additional interest on top of interest already on a loan :angry:
Hmmm.... You've only calculated the interest for one year, but you've got a 5 year loan so there is interest added for each year that there is a remaining balance. Rather than try to go into a lengthy explanation of how interest is calculated, go to this site and plug your numbers in to see for yourself.

Loan Calculator

Z
 

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Ah I see now, thank you. The numbers add up using the calculator. Eh this is my first loan so I wasn't aware of the hidden charges behind the rate. Might be better to choose a CU loan.
You are learning the realities of credit and financing. And that is that interest rate, or in the case of leasing, financing factor, are A significant part of you car or lease payment. This is why car manufacturers sometimes sponsor Low or even 0% financing when they are trying to move slow selling vehicles. The low interest financing helps keep the monthly payment low. Since the CRZ is new, Honda is not offering such financing on it.

The mistake that many new car buyers make is thinking that the car dealer is doing them a favor by arranging their financing. The dealer will often offer a buyer a higher than market interest rate and will get a kick back $$ from the financing company for delivering this naive customer for higher than market rate financing. As a result many car buyers think that they got a "good deal" on the purchase price of a new car, only to give much of this good deal back in the form of a bad deal on their financing.

You are almost alway better off getting a loan from your credit union or bank rather than thru the dealer's arranged finance, unless the dealer has access to low interest rate financing sponsored by the manufacturer. Now someone with poor or no credit will usually have to pay a higher rate than someone who has good credit.

People with a house, and equity in their house, will usually find that taking a home equity loan is more beneficial because the interest on such a loan is tax deductible where the interest on a typical car loan is not deductible for an individual.

Soapbox altert!
If you youngsters (I'm 50) have hung into this post this far, please heed my advice that you should work towards not having any kind of car loan. The idea that one must always have a car payment, like a mortgage payment or rent payment, is bad financial management.

You should try to get enough saved to buy your new car in cash and use the trade in or resale value of each car you buy to make your next car affordable. I am not a rich guy and have never earned more than $85,000 in any year of my life, but I have owned many great cars and have not had a car payment for the past 23 years. Don't let your car be a drag on your own financial security.
 

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You earn $85,000 don't consider yourself rich :blush:

I'd probably qualify as living in poverty going by that measure lol. old man yelling at cloud rant noted :p
I didn't say that I earn $85,000/year. I said that I have never earned more than $85,000 in a year (during my 35 year working career)

When I was 27 and I was earning $25,000/year and I bought a new 1987 Acura Legend Coupe for $26,000. I financed $16,000 and paid off that loan in 18 months. After that car, I never financed another car. My point is you don't have to be a rich person to save up your money and pay cash for your car. But buying and financing new car beyond your means can keep you poor for the rest of your life.
 

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Discussion Starter · #16 ·
Yea, stealerships always find away to fuck you over. I'm glad I'm not the only one. I mean, i wish it wouldnt happen to everybody, but I'm just saying.

Btw i just found out my interest is 5.5 percent.
 

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Hmmm.... You've only calculated the interest for one year, but you've got a 5 year loan so there is interest added for each year that there is a remaining balance. Rather than try to go into a lengthy explanation of how interest is calculated, go to this site and plug your numbers in to see for yourself.

Loan Calculator

Z
going by that calculator i'd be right around $331/month... with a HORRIBLE interest rate :(
 

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My first car I bought was 27k and I put 17k down on it. Then proceed to finance the rest for 5 years. That only lasted 2 years before I paid it off. Debt to me is much more of the thinking of 30 to 40 years ago. It gives me nightmares! I really just think too much. Luckily that same car I was able to sell for 20k after 3 years, so Ill be buying this cr-z outright and not have to worry about any financing until I have to pull out student loans:cry:
 

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Another question: (Sorry this is my first car purchase without assistance)

Filled out the purchase order form and put down a deposit. But I want to change the financing terms. Can that be done or am I sealed by the paper?

 
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