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Financing Articles

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Car Down Payments & Monthly Payments Up In Q4
   Published January 20, 2021
How much did you make for a down payment on your last car? If it was $4,500 dollars, you’d be under the current average. Down payments are up in the age of the pandemic, surpassing $4,700 in the fourth quarter of 2020.

Average Down Payments: According to an Edmunds analysis, the average down payment for a new vehicle climbed to $4,734 in Q4. That’s up from $4,458 in the third quarter and $4,329 a year ago. The takeaway here, according to  Read More
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6 Reasons Senior Citizens Should Consider Leasing Over Buying
   Published January 6, 2021
Weekly on the Car Pro Show, we have a number of callers who identify themselves as senior citizens who are considering leasing for the first time.

I explain on the air that as we age, our mobility becomes more and more important and, frankly, precious. For many seniors, they have never given much thought to leasing a vehicle; many grew up in a time that this just wasn’t done. However, it should be considered, along with the purchase option. It is wise to look at both in-depth to make the  Read More
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Basics Of Auto Financing
   Published December 9, 2020
I hear from listeners all the time who are looking forward to getting a new vehicle but dread the process of going through the financing process. Honestly, there is nothing to be concerned about if you understand what will happen once you get into the finance office. Knowledge is power, and below I will tell you what you can expect, and hopefully you won’t encounter any surprises.

Finance Departments

Beware: Like every profession, there are good dealers and bad dealers. Many people are taken advantage of in the finance department of dealerships. Over the years, I have seen it all, high-pressure tactics to purchase extended warranties, credit life, and disability insurance, GAP insurance, etc. I have also witnessed downright fraud. Bear in mind, most finance managers are paid on commission, based on what they sell.
  Read More
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The Truth About Dealership Spot Deliveries
   Published November 20, 2020
I got involved with a Los Angeles listener who tried to buy a vehicle, trading his in, and taking conditional delivery of a new vehicle. After earnest attempts by the dealer, financing could not be obtained. When a new car is delivered before financing is 100% completed, it is called in the car business a spot delivery.

What Is A Spot Delivery?
So, just what does it mean if a dealer “spot delivers” you? The term has been used in the car business for as long as I can remember and simply  Read More
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Why The Best Price Is Not Always The Best Deal
   Published October 28, 2020
Sure, everybody wants the best price he or she can get on a car, right? I think often people assume that if they got the best possible price, they also got the best possible deal, but that is not always the case. As the man who trained me to sell cars many years ago always said: “there is no way a part-time customer can outsmart a full-time car salesman.”

The Problem With Being Hyper-Focused On PriceSome people love the idea of beating up a car dealership on price, getting them down to the  Read More
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Automakers Offer Financial Help For Fire and Flood Victims
   Published September 2, 2020
It’s been a tough year financially for a lot of folks. First came the economic impact of COVID, which is still ongoing, and add to that, many people are now also dealing with natural disasters in parts of the country, like hurricanes and fires.

Toyota Financial and Ford Credit are stepping in to provide some payment relief to customers impacted by Hurricanes Laura and Isaias, as well as those impacted by the wildfires in California and the derecho which struck the Midwest  Read More
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Special Report: The Used Car Bubble Is Bursting
   Published August 27, 2020
I’ve talked on the Car Pro Show for eight weeks about used car prices being sky high. I monitor the Manheim Dallas auction weekly so I can report to my listeners up-to-date information about trade values. I have also warned everyone that this bubble would burst and prices would drop hard and fast.

Just last Saturday I talked about every vehicle, especially trucks and SUVs, bringing way over MMR (Manheim Market Report). MMR is the gauge car dealers  Read More
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Car Pro Advice: Car Leases and Down Payments
   Published August 20, 2020
Something I said on the Car Pro Show recently spurred a lot of questions about putting money down on leases. I soon realized this was an area of confusion for many people.

If you do a conventional purchase of an automobile, I recommend putting as much of a down payment or trade equity as you can. This lowers the monthly payment and cuts down on interest charges. However, the scenario is very different with a lease.

While cash or trade equity  Read More
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Commentary: Sorry Dave Ramsey - You Blew This One
   Published August 11, 2020
I recently saw this question posed to money-guru and radio host Dave Ramsey, who I listen to occasionally and we, in fact, are on some of the same radio stations across America:

Dear Dave,

Could you explain why buying a new car at 0% interest isn’t a good idea?
Raina

Dear Raina,

The only way you have a chance of getting 0% interest on a new car is if you have perfect credit and pay full MSRP (manufacturer’s suggested retail  Read More
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How To Decide Whether to Buy or Lease Your Next Vehicle
   Published August 6, 2020
We had a listener call the show who was skittish about leasing, she had never done it before. We get this call at least weekly. Here are some things to think about when considering whether to buy or lease your next vehicle.

1. Consider How Much You Drive
When I get the question of lease versus buy, my first question back is always how many miles per year do you drive? Some people, especially third party leasing companies, will disagree with me on this; however, I maintain that if you drive  Read More
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How to Navigate the Car Dealership Finance Office
   Published July 8, 2020
Many of the questions I get on the air have to do auto financing. This is an area people who have bought cars before worry about. By the time it is time to sign on the dotted line, you may have been at a dealership for a long time, you are tired, and you are just ready to go home with your new vehicle.

Here are some things to keep in mind:

Finance Departments
Beware: Like every profession, there are good dealers and bad dealers. Many people are taken advantage of in the finance department of dealerships. Over the years, I have seen it all, high-pressure tactics to purchase extended warranties, credit life, and disability insurance, GAP insurance, etc. I have also witnessed downright fraud. Bear in mind, most finance managers are paid on commission, based on what they sell.  Read More
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New "Ford Promise" Program Allows Eligible Buyers To Return Vehicle Due to Job Loss
   Published June 30, 2020
A lot of people are worried about their financial future right now in the uncertain times forced upon us by the COVID-19 pandemic that refuses to loosen its grip. That can make the proposition of buying a vehicle, either new or used, even more daunting. So Ford is providing some peace of mind with its new “Ford Promise” program. It allows eligible buyers who purchase a 2019-2021 model-year new or used vehicle through Ford Credit to return the vehicle if they lose their jobs within  Read More
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Negative Equity Hits All-Time High in April
   Published May 20, 2020
A record number of consumers are upside down on their car loans, according to new research released by Edmunds. In a press release, Edmunds says its data shows that in April an all-time record share of 44% of new vehicle sales with a trade-in had negative equity, compared to 40% in March and 33% in April of 2019. The average amount owed on upside-down loans also climbed to an all-time record high of $5,571 in April, compared to $5,405 in March and $5,036 in  Read More
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Mazda Hires Toyota Financial As Finance Partner
   Published April 8, 2020
Toyota Motor Credit Corporation is launching a private label business with Mazda North American Operations, its first-ever client, through the creation of Mazda Financial Services (MFS). Mazda Financial Services began operations April 1 and offers a suite of automotive finance, lease, wholesale, dealer banking, and insurance protection products and services to Mazda dealers and customers in the U.S.

“We’re honored that MNAO selected us as their financial partner  Read More
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How To Get Help Making Car Payments During Coronavirus
   Published March 18, 2020
As the country battles the spread of COVID-19 and the resulting financial crisis now facing many families, automakers are tackling two separate issues. One, helping customers who may be severely impacted by COVID-19 and find themselves unable to make payments. To that end, automakers are offering to discuss payment options and help for current owners.

At the same time, automakers know they need to do something to bolster sales during this uncertain  Read More
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What To Do When You Can’t Afford Your Car Payments
   Published February 26, 2020
I hear from listeners all the time who can no longer afford their car payments. Unfortunately, by the time they reach out to me, it is often too late. Here's what to do if it happens to you.  Read More
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The Dangers Of Co-Signing An Auto Loan
   Published February 24, 2020
By nature, we are a giving group of people. We really want to help people when they are down on their luck; it is what we do as Americans, right? So you have a friend or relative who asks you to “just co-sign” a car loan so he or she can get around, take the kids to daycare, and get to work. It sounds easy and you believe he or she will do the right thing. Sadly, too often, these scenarios play out with a loss of money and a loss of the relationship.

Of course, there are exceptions. My  Read More
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FTC Cracks Down On Credit Repair Services
   Published January 29, 2020
The operators of a bogus credit repair scheme are banned from the credit repair business and subject to a wide array of other requirements under settlement terms with the Federal Trade Commission.

In its press release the FTC states: the settlements relate to an FTC complaint filed in June 2019 alleging that the defendants targeted consumers with false promises of substantially improving consumers’ credit scores by claiming to remove all  Read More
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Will Paying Cash Save You Money at the Car Dealership?
   Published January 2, 2020
Paying Cash vs Financing
You read that right, you can often get a better price by financing the car with the dealership from which you are purchasing.

Thinking back to my years in the retail auto industry, I ran across a lot of people who wanted to throw around the fact that they were paying cash, and were determined that they should get some sort of special deal because of that. The truth was, as a car dealer, I didn’t really care how we got our money. Whether cash, credit union, bank or  Read More
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What To Know About Pull-Ahead Lease Offers
   Published September 11, 2019
Pull-Ahead Lease Programs
Over the last few years, these programs have become very popular with automakers, and are just another form of an incentive. It can vary, but generally if you are currently in a lease, the “pull-ahead” will allow you to skip up to your last three payments if you lease another vehicle of the same brand. This is particularly good for people who are on track to go over their mileage allowance. Essentially, you are moving your lease end date up by 90 days.

Are their  Read More