TypeS_boi

Guys, I may have a buyer and she is telling me about used cars having high interest rate if she were to buy. Can someone fill me in on this? I've never had to sell a car so I don't know too much about it. Does it make a difference how much interest is calculated depending on how old the vehicle is? You would think the interest would be lower the older the car gets right? Or am I wrong? What do I the seller and the buying party have to expect? Nedd help fast! Thanks -john

mrsteve

iTrader: (1)

It doesn't matter how old the car is. Generally, used car loans carry a higher interest rate than new cars, that's all.

chabanais

Au contraire... age of the car makes a big difference. If the car is over 5 years old then the bank will not like it and will charge more interest.

The bank just wants to make sure, in case of Repo, they can get their money back, so the newer the car the better the interest rate. Also, the better a car holds its value, the better the interest rate.

Have the seller go to www.capitolone.com and apply there. Best chance to get financed and the answer will be ASAP. Or have them go to a credit union. But better hope their credit is okay. The more they put down the better the chance of getting financed.

Trust me, I work for an Acura dealer... I know how this works.

mrsteve

iTrader: (1)

^ He's selling a CL-S... it is less than 5 years old. I don't see why she would be complaining about a high interest rate.

glennanddenise

It really just depends on where she is getting her financing from. Used cars will have a higher interest rate because a new car manufacturer isn't subventing the finance rate vs. a bank that makes its revenue of charging interest on loans.

She should shop around - credit unions typically have an advantage over the big banks.

The only thing you should care about is making sure she's giving you a bank draft that can be verified at a major financial institution. (Or a money order)

sixgearcl

Banks look at all things... how many mile the car has, what year it is, and type of car to determine rates... They wont dramatically change the APR but they do all those factors into consideration...

My bank loan through chase was a 4.9% i was also given the option to purchase a warranty and they would lower the rate to 3.9... it assures them that they are safetly financing a car that wont be burned in a year

so Yes they do look into it

chabanais

Maybe it is a high-mileage car and/or she has bad credit.

TypeS_boi

thank you guys for the quick replies...always count on everyone to give advice. Anymore financial geeks wish to chime in feel free. I'm gonna print this page out and show her. So yea, I guess it could depend on a lot of things which I didn't think about like her credit...etc. Thanks!

F900

Just to give you an example, 2002 Cars and up from someone who has bad credit here in FL the most interest rate they can charge you is 18%, 2001-1999 is anywhere from 19%-29%

Just call any used car dealer in your state, that be the easiest way to find out

TypeS_boi

SHe's gonna call her back cuz apparently she was given a pre-approval offer for some amount. I told her if the rate was higher at her bank then I would sponsor her to join my credit union which may offer her lower like some of you had mentioned. I'll find out tomorrow what the status is.

BlueCLS6

What are you getting instead? 6-Speed?

TypeS_boi

Hey Steve, yea I wish I could! Actually gonna step in the water w/ the grown folks and buy a house. I'm pretty excited and in a few years hopefully we get an awd or rwd coupe from acura and will be sitting pretty in MY HOUSE w/ MY GARAGE! Hate paying rent y'know!?

Chopsie

Credit Score is pretty much teh deciding factor on this loan rate with the CLS. She doe need to do some shopping around to see who can offer her the best rate.
Good Luck John !

sixgearcl

if your gonna print out this page and show it to her...

i've always wanted to date a girl that shares the same intrests that i do... you and me baby cruisn in our CLs... im an aquarius outgoing...

TypeS_boi

haha...sorry man, she's not much of a looker sixgear!

sundance_gold

Sounds to me that she's trying to nickle and dime you into lowering your price. Unless you absolutely have to sell your car, I'd stand firm on your price.

On paper or in theory (which ever cliche you want to use) used cars have higher interest rates than do new cars--I think it has something to do with residual values and the higher likelihood of a used car to become scrap (useless AKA no value) over a new car. But in today's market with the glut of used cars out there--caused by the financing incentives for new cars, I don't really think that traditional argument stands.

I think there would be a greter chance of the person having a higher interest rate due to their credit history moreso than the age of the car (directly).

If they try and say, well I culd qualify for 0 % financing if I wanted a new car well then I'd say "see ya!".

bl^5

My credit union sometimes has higher rates for used cars but usually it is the same for used and new.

What they really look at is the value of the car versus the amount they are financing. They don't care how old the car is if its value is more than the amount you are financing. I bought a '94 weekender last year at 3.9% interest. They would not let me finance it for 5 years because it was less than 4 or 5 grand.

TypeS_boi

Guys...the girl goes home and tells her husband bout the car, this dumbass thinks they still make the Legend. He was under the impression that she was gonna pick up a 01 Legend. Geezus fukin Khrist man! thanks for all the advice tho, it will be useful for when I do find a buyer.

98CLChick

When I bought my car used, I got a loan from Chase, and the interest is like 6%. Which didn't seem so bad to me.

mrsteve

iTrader: (1)

My rate from American Honda Finance is 6.3% That was on a CL-S that was a year old.