Financing Articles

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Why Car Buyers Should Steer Clear of Long-Term Auto Loans
   Published November 25, 2018
It is easy to get caught up in the phenomenon of the new car smell. You saw a car that looked great to you, your old car is tired and you are tired of it. You go to a dealership, take that test drive, and the love affair begins. You are blinded by your favorite color, the great stereo, all the safety features, and the fuel economy. You’ll do whatever it takes to drive home in your dream car. Does that mean you’ll sign a 7-year legal, binding contract so you can afford the payments? If so, you  Read More
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How Your Credit Score Impacts Your Car Insurance Premium
   Published November 15, 2018
What you pay for car insurance depends on more than just where you live, how old you are and whether you have a clean driving record or not. It also depends heavily on your credit. Most car insurers use parts of your FICO (Fair Issac Corp) credit score as a factor in determining what premiums to charge, except in California, Hawaii or Massachusetts where it’s illegal to do so.

FICO Credit ScoresFirst let’s looks at the different groups of the FICO score according to Experian.
800-850 =  Read More
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The Truth About Third Party Lease Companies
   Published October 23, 2018
A Houston caller last week started our call saying he wanted to lease a new F-150 and was going with a famous third party lease company, not affiliated with a dealership. I sort of jumped on him, then apologized, explaining to him that this was not a good idea.

Third-Party Lease CompaniesI enjoy pointing out car dealer ads to my radio listeners that I find false or offensive. For one thing, people seem to enjoy the education, and it gives me satisfaction to think that maybe I can dissuade  Read More
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6 Reasons Senior Citizens Should Consider Leasing Over Buying
   Published October 3, 2018
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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Will Paying Cash Save You Money at the Car Dealership?
   Published September 19, 2018
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 12, 2018
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
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Car Shopping Survival Guide To Busy Holiday Weekends
   Published May 24, 2018
If there’s one thing that is a given, Memorial Day Weekend will be a busy one at car dealerships. There’s a reason for that of course. The unofficial start to summer is one of the best times of the year to buy a new car.

It’s not just yearly hype either. This year, high inventories, great incentives, and low interest rates are creating the perfect storm in the car buyers favor, according to Car Pro Show Host Jerry Reynolds. Plus, used car prices are skyrocketing which means top dollar for  Read More
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How to Navigate the Car Dealership Finance Office
   Published December 27, 2017
[Editor’s note: This article has been updated with new information and for comprehensiveness since its original posting date.]

Lots of people will be entering the finance office of a car dealership in the coming days, since we are here at the end of the month and year, also the busiest week of the year. The finance office can be a scary place for many people, but there really is nothing to fear if you take your time and pay attention.

Many Buyers Like The Convenience Of Dealerships
More  Read More
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Best Week Of The Year To Snag a Bargain on a New Car
   Published December 27, 2017
[Editor’s note: This article has been updated with new information and for comprehensiveness since its original post December 11, 2017.]

December is the time to snag a bargain on a new car and it’s been that way for years. It is easy to get caught up in the hype and incentives and not end up getting a good deal. This year, people seem incredibly surprised at the deals dealers are offering up right now, mainly due to big customer incentives.

As a reminder, you can take all or part of the  Read More
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The High Cost Of No-Haggle Pricing
   Published December 19, 2017
Editor’s Note: This article has been updated since its original post in February of 2017.]

We had a perplexed radio show caller last Saturday who found the perfect car at one of the used car only dealerships, but he knew it was overpriced.

I can’t help but chuckle to myself when someone tells me he or she bought a vehicle from a place that doesn’t negotiate prices and had a wonderful experience. My first thought is always: of course! You can have a wonderful experience at any car lot in  Read More
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Factory Rebates and Incentives Are Your Money
   Published December 18, 2017
I’ve been in the auto business or an auto journalist for the vast majority of my life. I study factory rebates and incentives every single month when they change, and even after all these years, I get confused.

Given that, it is no wonder people get cross-eyed when it comes to incentives. The dealers themselves have trouble keeping up. Dealers have no idea from month-to-month what the incentives will be, and it is common for them to change numerous times during any given month.

What to  Read More
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Auto Financing Basics How-To Guide For Car Shoppers
   Published December 4, 2017
[Editor’s note: This auto financing article has been updated for comprehensiveness since its original posting in May of 2014.]
If you tune into the Car Pro Show, you know Kevin doesn’t actually listen, even though he is sitting right there. Nonetheless, he requested I approach the topic of auto financing because a lot of people have been asking him about it.
Beware: Like every profession, there are good dealers and bad dealers.
Many people are taken advantage of in the finance department  Read More
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What To Do When You Can’t Afford Your Car Payments
   Published October 11, 2017
I heard from a listener this week whose sister got in over her head with a hot Dodge Challenger on which she could not make the car payments. This is a question I handle on a pretty regular basis.

Sometimes it is because the person lost his or her job, but more often than not, it is because the person didn’t think through his or her budget very well. I actually hear from people who want to trade their cars to lower their payments $50-$75 per month. Normally, this cannot be done because they  Read More
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When You Owe More on Your Car Than It’s Worth
   Published July 26, 2017
Usually, when we get callers who owe more on their car than its true value, they financed too long or rolled negative equity from one loan to another. One such caller owed $8000 too much on her car because she was way over her mileage on a lease, due to excess mileage penalties. She wanted to try to roll that into a new loan, but not only was that a bad plan, the overage was wreaking havoc on her next payments.

Being “Upside Down”
The car business has a language of its own and always  Read More
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How To Decide Whether to Buy or Lease Your Next Vehicle
   Published July 12, 2017
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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The Truth About Dealership Spot Deliveries
   Published January 17, 2017
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 31, 2016
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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The Dangers Of Co-Signing An Auto Loan
   Published April 4, 2016
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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Why Car Buyers Should Beware of Long-Term Auto Loans
   Published September 7, 2015
I have written on the subject of extending car loans before, but new information has me compelled to warn people again of the dangers of stretching out a car loan to achieve an affordable payment. Believe me, I get it…it is easy to get caught up in the phenomenon of the new car smell. You saw a car that looked great to you, your old car is tired, and you want the latest and greatest new model out there.

Beware of Long-Term Car FinancingYou go to a dealership, take that test drive, and the  Read More
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Buying Your Dream Car: When Patience Saves You Money
   Published February 9, 2015
I had a caller on last Saturday’s Car Pro Radio Show that wanted to buy a 2015 Ford Mustang GT.

He admitted that on his budget, he would have to get one below dealer invoice to be able to afford it. I posed the question to him back: “why would any dealer do that when there are people willing to pay MSRP for the car?”

My advice was to wait. Things change, cars that are hot today may not be hot down the road. There is a certain amount of the population that wants to make a statement by  Read More