Auto Refinancing

"Snuze: Needs another Swede" (markg)
08/04/2018 at 12:52 • Filed to: None

So the wife and I parked a deal on a new GMC Terrain. With current incentives, GM will knock an extra 2% off the purchase price if you finance through GM Financial. T heir rate is 4.54%, but my credit union is offering 3.29% on new, and 3.59% on a current or previous model year vehicle with less than 7,500 miles . We are putting a good chunk down, almost half, and I’ve run the numbers and at the end of the day we still save more going through GMF.

But, in the interest of maximizing savings, can I turn around and re-finance with my bank at that 3.59% rate? W e have very good credit so I’m fairly certain we would qualify for that rate. Anyone ever done anything like this and immediately re-fi?

DISCUSSION (12)

JCAlan > Snuze: Needs another Swede
08/04/2018 at 13:18

Yes. The kind thing to do would be to wait until after you’ve made 3 payments so the dealer doesn’t get a charge back, but at that rate they’re only making $100 flat on the financing anyway, so not a big deal. But yes, you can refinance at any point .

Source: I am a finance manager at a GMC store.

Snuze: Needs another Swede > JCAlan
08/04/2018 at 13:25

Thanks!

That was actually going to be a follow up question. The dealer is a friend and I don't want to screw him.

vondon302 > Snuze: Needs another Swede
08/04/2018 at 13:31

Refinanced my Boss about 8 months after new purchase thru my credit Union.

Knocked about a year off the loan and payment was close to same. It was easier than I thought it'd be too. Shouldn't be a problem.

blacktruck18 > Snuze: Needs another Swede
08/04/2018 at 14:08

You might want to double check with the credit union if the rate is good if you’re refinancing.

When we bought my Lexus it was going to be a bit of a pain b ecause our CU was in a different state than the dealer or something like that , I forget their whole reasoning now . I told the CU I would just pay cash and do all the finance stuff after and they could send me the check and they said the rates would be different f or a refinance instead of a purchase.

LOREM IPSUM > JCAlan
08/04/2018 at 14:11

Always wanted to ask an F&I guy... How do you manage to hide the forehead horns from clients?

I keed, I keed.

Under_Score > Snuze: Needs another Swede
08/04/2018 at 14:16

Not involving finances, but please get a 2018 instead of a 2017. The redesign is light years ahead of the old one.

Snuze: Needs another Swede > Under_Score
08/04/2018 at 14:40

Oh yes, its a 2018. I wouldn't have even considered a 2017.

Nothing > Snuze: Needs another Swede
08/04/2018 at 14:57

That’s exactly what I did with my FoST. I went in with 0% financing, but Ford had $3500 cash back if you financed through them at some absurd 5%. I did the cash back and refi’d the next week through USAA at 0.9%.

E92M3 > Snuze: Needs another Swede
08/04/2018 at 15:22

Just make sure GM’s financing isn’t using “Rule of 78's” or “Sum Of Digits” to calculate the interest.

That’s where they frontload the loan with interest ( similar to a mortgage). They lik e to do that sometimes to discourage people from paying off the loan early.

JCAlan > E92M3
08/04/2018 at 21:49

They don’t. No bank that I’m aware of does. Everyone uses simple interest.

JCAlan > LOREM IPSUM
08/04/2018 at 21:56

All depends on who you work for. GM makes sure all their store fronts look the same, but how they’re operated may vary widely. My dealer would literally give you the shirt off his back. He is the kindest and most generous man I have ever met, and has empowered his employees to act the same way in the interest of the customer . We strive for a profit, but only because we have 150 employees with mouths to feed . Other than that our mission is to spread the word of Christ. We are atypical, I know.

LOREM IPSUM > JCAlan
08/04/2018 at 23:14

In that case, we may have to look into having you anointed as the Patron Saint of Financing and Insurance. Good on ya's for being decent folks in an ocean of opportunistic deplorables.