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Question - Changed our minds on an auto loan
Old 08-21-2007, 11:07 PM   #1
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Question - Changed our minds on an auto loan

We bought a used Corolla from a Toyota dealer this afternoon. We were prepared to pay with a check from E-Loan. The dealer said they would see if they could beat our E-Loan rate. Their rate came in slightly lower, through a local credit union. I compared their monthly payment against our E-Loan monthly payment and it looked like even with a fee, the credit union loan was the better deal so we went with it.

After dinner I looked through all the papers and realized that I had miscalculated our hypothetical monthly payment through E-Loan. The E-Loan would have been the better deal. This was my mistake, I just copied down the incorrect figure for the payment per $1000. I could kick myself because this is the type of stuff I love to do - correctly!

I'll call in the morning and see if we can substitute the E-Loan for the credit union loan. But I don't know if it's reasonable to expect them to let us do this. Is there a 3 day law on auto loans?

We made a good down payment and our loan is only for $6000, so even if we can't get out of this, it's small potatoes, less than $4 a month. It just bugs me to pay anything more than we have to.

We've been shopping for a car for about a week now. My husband took the day off so we could finally get serious and make a purchase. We are happy with the car and the price. And I screwed it up with a clerical mistake in comparing the loans.

*kick*
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Old 08-22-2007, 08:37 AM   #2
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Is there a 3 day law on auto loans?
It varies by state, but where I live in California there is no cooling off period.

The good news though is that any car loan can be re-financed. Only the really crappy loans have a payoff fee.

So if your car dealer won't change the deal don't sweat it too much. Just call up your credit union or E-mail E-loan and see if they can refinance the deal.
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Old 08-22-2007, 08:45 AM   #3
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Originally Posted by MasterBlaster View Post
It varies by state, but where I live in California there is no cooling off period.

The good news though is that any car loan can be re-financed. Only the really crappy loans have a payoff fee.

So if your car dealer won't change the deal don't sweat it too much. Just call up your credit union or E-mail E-loan and see if they can refinance the deal.
There is in general no 3-day right of recision unless you conducted business "off-site", away from the dealership, like those stadium sales.

Let them book the deal, call for a payoff, and let E-loan send them the pay off........

Did you get a regular Corolla, or the S model type?
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Old 08-22-2007, 09:43 AM   #4
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I called first thing this morning and the finance guy told me that it was instantly funded last night and cannot be undone. It was worth a try.

We had a quick discussion about E-Loan. He says they really don't like to deal with E-Loan and others like it, that sometimes they don't get their money for a while and it can even take so long that it delays the title and the 30 day tag expires and that's a problem. I have a feeling that's BS.

The E-Loan rate was 6.85% with no fees on a older used car. The credit union rate was less, 6.5% but there were fees. He didn't coerce us or hide any information, it was my mistake in calculating the rate per $1000. We compared and due to my mistake, the credit union loan looked better.

We bought the Corolla to replace my husband's 1996 Ford Ranger pickup truck with 65,000 miles. The Ranger looked great but underneath it had major rust problems. The hanger for the one of the rear leaf springs had rusted so bad that it had collapsed. The chassis was resting on the leaf spring, very close to the brake lines. The hangers on the other side were almost as bad. The front shocks also needed to be replaced. The whole rear of the truck was tilted to one side and there were crunching sounds going over bumps. We knew it needed new shocks, but this got much worse within the last couple of weeks and when we took it in to see what it needed it came to close to $3000. The truck was kind of like that racehorse, Barbaro. Looked just fine but had fatal flaws. My husband doesn't need a truck, it was just a commuter vehicle that was cost efficient in 1995. He had been considering replacing it with a car for a while now.

The suspension was so bad that we thought about having it towed in for the trade. My husband was concerned that the other side could collapse and he could lose control, possibly hurting himself or someone else. But instead we took back roads with me driving right behind him. Yeah, maybe we kept this one a little too long!

We shopped for 2003-2005 Corollas or Honda Civics. We looked at a lot of Certified vehicles and most were $13,000 or more. Our target price was $10,000 - $12,000 and we were starting to think we'd need to adjust the target. We have other Toyotas including a 1990 Camry with 130,000 and a 2003 Camry with 47,000 so we like Toyotas and can see the value in older cars with high mileage.

So we were walking the lot, seeing too many cars above $13,000 and my husband spots a 2001 Corolla with 86,000 miles. It was only $8995. He says, "What the heck, let's test drive it." He surprised me because he's usually the one who spends without thinking and I overthink every dollar.

As we are doing the test drive he says things like, "I think this is the car I need. It still feels tight, I like the body style, I think this is the one." Then he comes up with, "You know, if we are working toward me retiring in 6 years, maybe this will be just fine for what I need." At this point I was almost speechless because this is a major change in his shopping attitude. We all drove it and basically decided that older and cheaper has it's advantages.

We made a cash down payment and needed a loan for just $6000 so the payment is way below what we had budgeted.

Making the wrong decision about which loan is not a huge mistake, it's MINOR when you look at possible financial mistakes one could make. It just bothers me that I'm the one who made it. I'm the type that uses coupons, follows up on rebates, goes for the lowest rate on loans and highest rate on savings.

I guess this will teach me to be more careful, again.

Quote:
Originally Posted by FinanceDude View Post

Let them book the deal, call for a payoff, and let E-loan send them the pay off........

Did you get a regular Corolla, or the S model type?
The E-Loan can only be used for a purchase from a dealer. The Corolla is a regular Corolla LE 4 dr sedan. It looks just like this -
http://i20.ebayimg.com/01/i/000/b1/3f/31c2_1.JPG with a nice interior and an aftermarket radio with a CD player. It was very clean and the trunk looked like it had rarely been used.
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Old 08-22-2007, 11:19 AM   #5
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Too late now I guess, but, if you can qualify for Membership Navy Federal CU has a rate of 3.5% for 36 months on new cars and 4.25 for 36 months on used cars. No prepayment penalties, no fees except the filing fee for the lien (usually about $20.00).
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Old 08-22-2007, 11:48 AM   #6
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Thanks for the info on Navy Federal. My dad is a WWII Navy Veteran but not retired from the Navy.

I'll keep my eye out for lower cost refinancing possibilities in the future. It's a small loan, 6.5% is not all that bad and I get offers all the time, I just don't want another credit card.

I'm still mad at myself for my mistake ... GRRRR. This will cost us an additional $3.91 a month and don't you know, I'll remember it every time that payment is made. I'm going to take a few "cleansing breaths" and shed the guilt and get over it and be done.
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Old 08-22-2007, 06:50 PM   #7
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I think that you came out about even, no biggie. The amount financed is so small, it's not like a home mortgage for 200K where 1/4 point can cost you a few grand. It's only 6K, you couldn't go for sodas for the diff. so don't feel bad.

You have to be carefull when using another bank after the dealer submitted the MV paperwork listing the 1st bank on the title. Once that's done you have to wait for the title to come to you in most states otherwise the 2nd bank won't want to be second on the title. So make sure you have the title before trying to take another loan.

At least in NY there's no 3 days cooling off period unless it's an in home sale. When you go to the sellers place of business it's over when you sign.
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Old 08-22-2007, 08:49 PM   #8
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There is in general no 3-day right of recision unless you conducted business "off-site", away from the dealership, like those stadium sales.
I cannot speak for other states, but in Florida, there is no cooling off period for "off site" sales either.
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Old 08-22-2007, 09:30 PM   #9
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I thought there was a 3-day federal law for off-site sales (especially for things like the door-to-door magazine salesman, etc.) Seems logical it would apply to cars, also.
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Old 08-22-2007, 10:05 PM   #10
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Off topic a bit but I noticed that now that I live in Fla. the car dealers do spot deliveries only. Which means they don't want you to wake up and you have to take the car with you when you buy it.

In NY people would buy a car and may not pick it up for one day or up to a week. A certain amount of the people would get cold feet and then the fun started. Some folks would think it's OK to shop after they bought the car and signed a contract. Every time I ended up in small claims court representing the dealership where I worked we won the case. People would have to pay 15% of the sale price of the car. They were not happy to say the least. There was a court case (Neary vs. Retail Marine) that the court would go by.

Just know what your signing when you buy something.
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Old 08-22-2007, 11:22 PM   #11
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Too late now I guess, but, if you can qualify for Membership Navy Federal CU has a rate of 3.5% for 36 months on new cars and 4.25 for 36 months on used cars. No prepayment penalties, no fees except the filing fee for the lien (usually about $20.00).
A while back, I wanted to post about my experience with NFCU, but chickened out as I have been chastised on this forum for borrowing money to buy a car........anyway bought a 2002 model yr used truck for 8k and was going to withdraw cash from NFCU......when I went online they were promoting a 4.25 rate......which is lower than my MM pays, so I applied for a 7k loan instead. They approved the loan instantly for 8k (more than I requested), but bumped the rate on me upto 4.75 ( I guess my credit score was a bit too low?), anyway I am extremely happy with it and wondering how i am paying less interest for a 5 yr old used truck than Im paying on my mortgage?! I don't recall paying ANY filing fees for the lien (may vary by state....Im in MD)
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