re: Updated v.3.16 - Will Cover's 2018 buying guide to purchasing a new vehicle

quote:

---

Report
• The average household is now carrying $15,983.00 in credit card debt – NerdWallet
• 78 % of full-time working Americans are living paycheck to paycheck – Fox News
• Only 39 % of U.S. adults have enough to cover a $1000.00 emergency - Bankrate

---

The frick are y’all doing out there?

quote:

---

Extended warranties never make financial sense.

---

THIS

For everything anyone purchases

The formula A = P(1 + rt) is the total amount accrued, principal plus interest, from a simple interest loan.

A = Total Accrued Amount (principal + interest)
R = Rate of Interest per year as a percent; R = r * 100

Car loans are simple interest loans, what part of that do you not get? Let’s take half that $30K and use $15K as a reference point, and the APR of 5%. Say your payments are due every May 1st since we’re almost there, as another reference point.

You’re taking into account if you sent a $300 payment on May 1, then $238.36 goes toward principal, at a hypothetical 5% APR. If you sent the same payment on April 20, then $258.91 goes toward principal. If you can pay early every month, your principal balance shrinks faster, and you pay the loan off sooner than the original estimate.

The majority of people have their loans set up through automatic bill pay every month so they don’t have to worry about it. The figures I was using in my OP had to deal with interest expense in its totality, over a 72 month term, on a 30 day recurring payment schedule.

quote:

---

the dealership could possibly make on holding rate

---

And where did I say, I EVER financed a car through a dealership dumbass? An integral point of the OP's thread was to secure your own financing. Holding APR points by the F&I department does in fact happen.

quote:

---

9. Settle on the price of the vehicle you’re interested in before you bring up financing – don’t let the rate of a loan influence the price of the vehicle. Have your financing pre-approved before you walk into a dealership. The little differences in the numbers can be huge. Consider this: $20,000 financed over five years at 3.9% costs $2,045.80 in interest. The same deal at 7.9 percent costs $4,272.20 -- a difference of more than $2,226.00. If you’re intent on financing, I highly recommend Pentagon Federal Credit Union or Lightstream (a division of SunTrust Bank) for auto financing.

---

Reading is not a high point for you, as we can all see your ignorance.

Your simple interest formula is not the proper formula to use here. That formula assumes your payments are interest only payments which is not how auto loans are structured. Auto loan payments include both principal and interest structured so that your balance will be zero at the end of the term, thus greatly reducing your total interest paid.


Rando is correct. Plug these numbers into any car loan calculator or excel loan amortization schedule and you will see.

I get that amortizing occurs. The different APR's that were used as examples were used as a model to showcase how the dealership profits on holding 1-1.5% of APR on a customer that does not secure their own financing, and decides to finance through the dealership instead. Again, the figures I used were based on a 30 day reoccurring payment plan, and did not factor in early or late payment fluctuations.

So on your insurance software you used, why are the rates not present?

Ah, so you won't show your steps in your calculations, got it

Carry on, Mr. Magic Box.

quote:

---

Breauxsif

---

You're very wrong in this thread man, FYI.

Will Cover I am about to lease a new car. i have questions for you can you help me buddy?