First time car buying advice.

After dealing with beaters all my life, I feel I'm ready for a new car. I've always bought things with cash, so this would be my first time dealing with financing. My credit rating is great, 793 last summer.

Should I go through my personal bank or deal with the dealer? I assume you'd go with whom ever gave you better APR? Is there better reasons I don't see to stay with my bank? Whats Caramax like to deal with? What's a good finance rate these days?

I'm looking at the Frisbys and NC Miatas. They will be certified used. I want a warranty. Or do warranties transfer with private sales?

I'm in a hurry as the 4runner just threw a rod, and I only have a motorcycle to get to work. I just don't want go half cocked and get sucked into a crap deal.

I need your help.

For financing talk to a Credit Union or your current bank (or both, or many.)
A dealership is not required to offer you the lowest APR that you qualify for. They only have to present you the lowest APR your willing to accept.
The dealership makes a "commission" from the lender for gettin you to sign the papers. The dealership may present you the loan which best meets the dealerships benefit. Said another way...the dealership may push some bad terms onto you so that they can get paid better.

We have a similar credit score and dealing with CarMax was very pleasant. They do (or did) in house financing for their customers with good numbers and we couldn't have beat the rate anywhere else. Buying a CPO through a dealer 'might' yield you a better rate, but you need to check. It doesn't hurt to go ask your bank if you have a good relationship with them. They should be able to give you a ballpark rate based off a hypothetical car.

IIRC applying for multiple car loans in a very short amount (couple of weeks) of time shouldn't affect your score much more, if at all than a single enquiry.

I would definitely shop a loan around before going to the dealer, it's sometimes amazing how the rates can tumble at their end when you point out that Credit Union XX is offering you a really low rate.

"If you have very good credit and you're able to [take] on debt, this is the time to borrow," says Joseph Pucella, a vice president and senior credit officer at Moody's Investors Service, a credit-ratings firm based in New York. "Rates are very low still and the banks are competing for that type of customer, so you've got more options."

From this article: http://www.wsj.com/articles/the-new-rules-of-borrowing-1410541812

I was offered 2.29% on a used vehicle by one of the lenders mentioned in this article (but I bought a cheaper used car cash anyhow).

Also, make sure to crunch the total cost of ownership numbers. With 0% financing, in a lot of cases the total cost of the car (price+interest from loan) turns out to be slightly cheaper or negligibly more expensive for a brand new car vs. ~2 years old. That turned out to be the situation for my sister's Toyotas in two separate occasions. I'm not advocating one way or the other, but make sure you look at the amortization table for whatever you're getting into. Plus you can get exactly what you want.

Also, I haven't checked, but I imagine the cost of new NCs has fallen through the floor now that the ND has been committed to.

But to echo the previous owners, for my Rx-8, I had my credit union lined up to cover it.... BUT, I was able to negotiate a better deal with the dealer by financing through them (they were able to lower the price a decent bit because I agreed to finance through their bank). I then switched to my credit union after one payment. Total cost: +$5 in interest for my one payment, total saved: ~$1,200.

Remember EVERYTHING is negotiable. Examples of negotiable costs include vehicle price, accessories, extended warranties, maintenance, and interest rates are all negotiable.

Dealers have some wiggle room on the rates they give, so if you ask/push they may be able to come down 1/2% to 1%.

I would also ask them to show you the list of rates they received approvals for your application. If they aren't trying to take advantage of you they shouldn't have a problem showing you.

F&I can be hellish. Ask me how I know.

jstand wrote: Remember EVERYTHING is negotiable. Examples of negotiable costs include vehicle price, accessories, extended warranties, maintenance, and interest rates are all negotiable. Dealers have some wiggle room on the rates they give, so if you ask/push they may be able to come down 1/2% to 1%. I would also ask them to show you the list of rates they received approvals for your application. If they aren't trying to take advantage of you they shouldn't have a problem showing you.

Not to CarMax in my experience. They won't haggle on their overpriced(even equivalent CPO pricing) stuff.

I recommend a good credit union, then sit down with one of their loan officers and discuss your intents and desires. They will ask what you're looking and how much you'll be putting down. Then, they'll preapprove you for $xxxxx amount on certain factors. Once you find exactly what you want, notify them, they'll throw the stuff into the computer, then you sign their paperwork and pick up a check and take it to the dealer. Dealer will need to send the title to the lienholder.

Its that simple for me, heck, I can do most of it all over the phone.

I think the lowest interest I could get on a new vehicle right now is between 0% and 0.9%, but when it comes to used, age matters. Used is generally 1.9%-3.5% for my credit union. They'll only go up to 7 years old though.

In reply to yamaha:

I missed the Carmax part of the OP. I was thinking typical dealer, not Carmax.

Why are you looking at NCs when the ND is coming out? The cost will be similar to a Toyobaru.

GameboyRMH wrote: Why are you looking at NCs when the ND is coming out? The cost will be similar to a Toyobaru.

Aftermarket Support?

We've bought two vehicles through Carmax. Financed through them both times. As said they will not deal, the price on the car is the price. However I felt both of our purchases were good value. By far the easiest buying experience I've had from any dealer. Will use them again if we ever need to.

In reply to WonkoTheSane:

What Wonko said.

I'm personally, generally opposed to new cars now, but with certain makes/models, assuming good credit, you might come out on top buying new.

We're paying 0 interest on our 5...though I'd much rather have a 10 year old MPV...but that's another story.

For credit unions, other's here recommended Pentagon Federal.

I signed up with them, and I'm paying 1.9% on a 10 year old car, which is pretty insane...in a good way.

GameboyRMH wrote: Why are you looking at NCs when the ND is coming out? The cost will be similar to a Toyobaru.

Probably the same reason I am. Budget constraints, aftermarket support and dealing with a known quantity.

I figured the leftover NC would be cheaper than the Frisbys because of the ND. Nope. Not around here.

In reply to Appleseed:

Check in Cali for fly and drives. Also there just weren't very many sold, so the supply isn't quite as high as one might imagine.

Smarta$$ McPoopyPants wrote: For credit unions, other's here recommended Pentagon Federal. I signed up with them, and I'm paying 1.9% on a 10 year old car, which is pretty insane...in a good way.

I'm also a Penfed member - their rates are pretty hard to beat, plus they recently (as in, sometime last summer) relaxed the lending criteria for cars and don't tend to have the 7/10 year, less than 100k miles restriction that most CUs have. At least they hadn't the last time I talked to them.

Don't have every bank on the planet run your credit report. It will lower your credit score if there are too many inquiries. Narrow the choices down to the places with the right numbers before running the reports.

You'll take a hit on your credit anyway, but if you do them within a short time, the impact is similar to a single enquiry.

From one of the horses' mouths: http://www.experian.com/blogs/ask-experian/2013/10/30/multiple-inquiries-when-shopping-for-an-car-loan/

How would you go about finding good banks to deal with. Go in and use my hypothetical 800 score and have them ballpark?

With a credit union, can I go in there cold and sign up with them? Never dealt with one before, so this is even more new ground to cover.

Tim, thanks for that article. Anything to make me feel at ease is a good thing.

Skip the Certified Pre-Owned. They cost more to certify than the price of a good 3rd party warranty. I pulled up both the FRS and Miata with a 72 month/75K warranty bumper to bumper for both cars and it's under $1300 for the same warranty I have on my daily drivers.

My credit union will pre-qualify you for a dollar amount and then just give you a form for the dealer to fill out when they do the paper work. At 1.65% no sense in going anywhere else.

Appleseed wrote: How would you go about finding good banks to deal with. Go in and use my hypothetical 800 score and have them ballpark?

I'm pretty sure they'll want to run your credit and won't ballpark.

I'd look at the smaller community banks local to where you live. The folks who bought the Evo from me used one and they seemed to offer a good rate and good service.

Appleseed wrote: With a credit union, can I go in there cold and sign up with them? Never dealt with one before, so this is even more new ground to cover.

Use something like this search tool to find a local CU and look up their membership criteria.

For example, there are a couple of them near me that are only for specific professions, and there is one that is open to all local residents.

Also, if you are eligible for USAA, check them.

PenFed (which has been mentioned a few times) has eligibility criteria based on an association with the military but you can also join as a pure civilian if you happen to be a member of a couple of associations listed on this page.

Navy Federal (which IIRC is the biggest CU in the country) has more stringent requirements, basically you have to be affiliated with the Military, Coast Guard or National Guard to become a member.

With a CU, you'll usually have to open a savings account and put some money in to become a member.

My experience with USAA & Navy Federal was that my local credit union had a better rate by about 1%. I then took the rate from my local credit union to the dealer and got them to beat it by 0.4% so I wound up going from 3% to 1.6%. One thing to be aware of when the dealer offers a better rate is to check the fine print. They tried to pass off a loan that had a prepayment clause (you pay the full interest no matter how soon the loan is paid off).

Anyone care to elaborate on 3rd party warranties?