If leasing doesn't work, you can also consider car subscription services.Ford Finance | Car Finance | Harrigan Ford Get a Quote Dollar Icon Download a Brochure Icon Book a Service Spanner Icon Specials Discount Tag Icon Book a Test Drive steering wheel Icon Search our Stock Icon Calculator Icon Search our Stock Icon Icon of Left Arrow Icon of Right Arrow Question Mark in a Circle Icon Icon of 3 Horizontal Lines Icon of a 4 square Quandrant Icon of a car Hand Offering Cash Icon Envelope Icon icon of Facebook logo icon of Twitter logo icon of YouTube logo icon of LinkedIn logo icon of Pintarest logo List Symbol of Lines and Dots Icon Calculator Icon Book a Test Drive steering wheel Icon Get a Quote Dollar Icon Icon of a magnifying Glass Icon of a Dollar Symbol Video Click to Start Icon Printer Icon Close Button Circle X Icon of 3. Leasing is also a good option if you want a new car more often. Lease payments are generally lower than they would be if you bought the car, because you're mostly paying for the vehicle's depreciation rather than the vehicle itself. This looks good to other lenders but whether that outweighs the potential negatives is for you to decide.Ī better option for many people would be to lease. If you're able to get a lower interest rate on a long-term loan, then the proposition becomes a little more attractive, mainly because the lower monthly payment afforded by a long loan equates to a lower debt-to-income ratio (i.e., you are spending less of your monthly income on payments towards debts). If your income level dictates needing that long of a loan to afford the monthly payment on your car, this could be a pretty tough pill to swallow. This means that if something goes wrong after the basic three-year/36,000-mile bumper-to-bumper warranty, you're on the hook for fixing it while you're still making payments. That's nearly $8,000 in interest alone.Īnother downside of an 84-month loan is the simple fact that your loan length is longer than your new car's warranty. But is an 84-month car loan the right move for you? The answer is, "probably not." Interest rates from Ford Credit on seven-year loans are relatively high at around 5.9%, which means that if you bought yourself a sweet new base Mustang GT for $37,480 (including destination) and you financed the whole thing - no down payment, no trade-in - you'd end up paying around $45,192 in total by the end of the seven-year loan period. So, according to that statement, Ford isn't planning on giving out 84-month loans all willy-nilly, which is good. FICO qualifications are included sometimes as part of marketing programs." Eliminating the separate FICO requirement opens the prospect of financing to more customers who would qualify for 84-month financing within our models. "Our proprietary scoring models already do an excellent job of assessing the probability that an applicant will be able to pay. Whether you are buying your vehicle for personal or business use, our qualified team will tailor a solution to suit your needs. We reached out to Ford Credit representatives for comment, and they had this to say: Sunshine Ford have a team of trained and accredited finance and insurance managers to assist you with driving away your new Ford efficiently, and with minimal fuss. It's possible that this change in loan practices could be construed as somewhat predatory, particularly since the change doesn't apply to any of the company's other loan products. Removing that score makes it easier to buy a new car, but it also has the potential to let people get themselves into loans with higher interest rates, which ties that customer to a lengthy repayment plan for an asset that's very likely to depreciate faster than they're paying it down. Typically, a minimum FICO score is taken as an indicator, along with other factors like debt-to-income ratio (more on this later), to determine a buyer's ability to repay the loan. This can be considered problematic for a few reasons. According to a report published by CarsDirect on Friday, Ford has removed the minimum credit score requirement for its 84-month car loans. Whether or not we're approved for that loan is determined by our credit score - except, in one case. For most of us, buying a car involves getting a loan, whether from a bank, a credit union or an auto manufacturer's captive finance company.
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