intrest rates!!!!!!!!!!!

[Johnyd2]

so i go to the used car lot to pick up a 95 trans am which i fell in love with. With a trade in it was 5500 out the door after taxes, title, and transfer. I'm twenty years old. I've had a humble apartment lease for 2 years, a couple credit cards, my own insurance, cell phone bill, and the title to my car is in my name. I have damn good credit for a twenty year old, i started when i was 17 and have never missed a payment on anything. So i get approved for a 5500 dollar loan for 30 months.... Im getting real excited now, that trans am was MINE.. i could taste it. Then i look at the monthly payments.... 280 dollars a month!!!!!!!!!!! Thats around 30 percent intrest!!!!!!!!!!! I know i dont have a whole lot of assets and i havent been in the credit bueuro for 5 years ( 3 years right now), and ive never finaced a car or owned a home... But 30 percent intrest????????? that seems like robbery......... I would appreciate some fedback on this, maybe from some older people that have established credit. Was i getting robbed, or is this something im gonna have to work through just to take the next step in my life...

P.S.... I'm to have some money saved up to make a nice down payment, so if there is alot of intrest invovled the principle wont be so high.

[Jay 02 TA ws6]

Shop around.

If your credit history is where you say it is, then you shouldn't expect to pay 30% interest - regardless of assets or number of years in the credit "bueuro". There's nothing magical about 5 years, so I don't know who told you that... if it's the same people who are offering you 30%, then that's strike two against them.

Assuming you have flawless credit (like you are claiming) you should expect to pay no more than 7-8% for a used car that's less than 5 or 6 years old. A ten year old car could definitely carry a higher interest rate, but 30% sounds outrageous - especially on a term as short as 30 months.

I'm currently paying 5.5% on a 60 month purchase.

Where are you getting that 30% number from, by the way? I don't have an amortization schedule in front of me, so I can't check your accuracy. Are you sure $280 a month is 30% interest?

[Johnyd2]

30 percent is what the "honest" used car salesman gave me.... after i heard that, my hearing kind blurred up and i just basically smile, nodded, and waited for the appropriate time to leave.... but yes, my credit is sqeaky clean... even the sales man said he was surprised at how good it was.... right before he threw that gut-busting intrest rate at me.

[BadWS6]

this calculator says thats 36% calc
Thats insane shop around you can do better

[TODD 2000 V6 CAMARO]

30 percent is what the "honest" used car salesman gave me.... after i heard that, my hearing kind blurred up and i just basically smile, nodded, and waited for the appropriate time to leave.... but yes, my credit is sqeaky clean... even the sales man said he was surprised at how good it was.... right before he threw that gut-busting intrest rate at me.

Just out of curiosity, is this one of those tote-the-note type places? Meaning, is it a little independant used car lot? Is it in-house financing? If it is, run screaming in the opposite direction. Those places will finance you, but they charge you outlandish interest rates, and it doesn't go on your credit. If this is the case, try looking for a car at the used lot of a new car dealership, or, better yet...go and try to get the loan from a bank. Just keep in mind that being a first time buyer, it is going to be hard to get financed for a used car, especially an older one. I tried to get a loan on a used car a bunch of times from my bank ( was in almost the same credit situation you are in) and they wouldn't give me the loan. Something about the fact the the car would depreciate way too fast for them to be able to foreseeably get the money for the loan should you default on it. I had no luck till I went to the Chevy dealer and got a loan on a new car, my Camaro. Hopefuly you won't have to try to get a new car, but to get a loan that small for a used car is next to impossible without a huge interest rate. I'm no expert, this is just my experience. Hope it helps.

[Jay 02 TA ws6]

Just out of curiosity, is this one of those tote-the-note type places? Meaning, is it a little independant used car lot? Is it in-house financing? If it is, run screaming in the opposite direction. Those places will finance you, but they charge you outlandish interest rates, and it doesn't go on your credit. If this is the case, try looking for a car at the used lot of a new car dealership, or, better yet...go and try to get the loan from a bank. Just keep in mind that being a first time buyer, it is going to be hard to get financed for a used car, especially an older one. I tried to get a loan on a used car a bunch of times from my bank ( was in almost the same credit situation you are in) and they wouldn't give me the loan. Something about the fact the the car would depreciate way too fast for them to be able to foreseeably get the money for the loan should you default on it. I had no luck till I went to the Chevy dealer and got a loan on a new car, my Camaro. Hopefuly you won't have to try to get a new car, but to get a loan that small for a used car is next to impossible without a huge interest rate. I'm no expert, this is just my experience. Hope it helps.

Agreed. If this is a small independent used car lot, secure your financing first - then go to the lot with the check in hand.

[Blazer]

Yes but 55 on a 95 is super high unless it is a super car. Check around an take your time. You will find the car you want. Good luck on finding your dream car. Blazer

[Johnyd2]

i appreciate your input, the used car lot was a hole in the wall, with one sister lot 15 miles away. I think the wisest move is to save up a whole bunch of money, take a small loan out from a bank and then pay it off right away. I have money in stocks and bonds, so money isnt the biggest issue. Part of my desire in doing this is not only for the car but the credit history. I live on my own in colllege and live off low intrest student loans. Im graduating in around a year and a half, and due to some complex situations i dont have the opprotunity to go back home and live with my parents. I just got good job, and i want to beef up my credit score, so when i step out into the real world, im already a couple steps ahead of everyone else. Thanks for the advice.. i knew this wouldnt be easy, i just had no idea that i would be this hard. I'm keeping my eyes out for my perfect opprotunity.

P.S. the car was one of the best running, looking, and driving, ive ever seen in a f-body that age (only 70K). No leaks, noises, or anything else.... back to the drawing board.

[Christopherrr]

30%!!!? Dang...he tried to pull one on you. Forget it...that's legal jacking.

['STANGETR]

I don't know about anyone else, but I sure as *heck* wouldn't want to purchase a T/A from those little hole in the wall dealers! I would never trust where it's been, or how it has been cared for. I'd pass that car for $5500 up in a heartbeat, no matter how bad I wanted it. I'm sure it would save you A LOT of money and headaches. I wanted a T/A real bad when I finally got the money, but waited long enough to purchase one from a private indiv. who took extremely well care of it and had all it's service records. Just try to avoid those "Value Auto Sales" places!