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      05-03-2010, 08:38 PM   #45
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Originally Posted by PicassoM View Post
I have he same question. Have not been able to find a lender who will finance ED without MSO. I've come to the conclusion that eD you have to pay BMW financing.

Anyone get May financing rates yet? I want to do ED but 6% sucks when compared to BOA ad other lenders
It's 3.9% for May for MY2011.
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      05-03-2010, 08:41 PM   #46
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Originally Posted by outie View Post
Good to know it's 3.99%. Perfect timing. The only problem is my p/u is 5/7 and I am flying out on 5/5. It's 5/3 today and the dealer has not contacted me for payment!
Are you serious? I heard at least 1 week before your pick up date you need to pay. That's why I went in today. My ED pick up is Monday, May 10. But because of the last second phone call, I have to go in tomorrow to pick up my credit union check and sign with BMWFS. Obviously less than a week tomorrow so I'm sure there is flexibilty, but your are cutting it close...
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      05-03-2010, 10:21 PM   #47
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Just throwing it out there...but make sure you understand the ballon payment and are comfortable enough with the terms / amount owed upon ballon drawdown...ballon style loans work well on houses as most home buyers are betting on the home becoming an appreciating asset thus keeping the loan from being under water...whereas the car is a depreciating asset (e.g. mileage, condition, accidents)...which can force you to owe a ballon on something far less valuable...anyway just my random thoughts..
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      05-03-2010, 10:52 PM   #48
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Originally Posted by spartan1685 View Post
Just throwing it out there...but make sure you understand the ballon payment and are comfortable enough with the terms / amount owed upon ballon drawdown...ballon style loans work well on houses as most home buyers are betting on the home becoming an appreciating asset thus keeping the loan from being under water...whereas the car is a depreciating asset (e.g. mileage, condition, accidents)...which can force you to owe a ballon on something far less valuable...anyway just my random thoughts..
Thanks for the heads up.

Yes. Fully aware on the concept. In my case, I'll be putting down a little over 20K. In year 2-5 I plan on accelerating my payments by 400+ per month giving me a balloon note of 0-10K. In addition I drive about 8,000 miles per year. So I can skip the balloon altogether and make a few extra bucks if I sell before the end of the term.

I went with balloon cause I wanted a lower payment in Year 1. I don't mind paying down the few extra bucks in interest on the balloon in the first year without compromising my lifestyle. I could have just waited the year, but my current lease is up in May.

I think the rule of thumb is a minimum 8:1 net income to car payment ratio per month.
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      05-04-2010, 12:02 AM   #49
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Quote:
Originally Posted by comebackid View Post
It's 3.9% for May for MY2011.
this is for standard 4-5 year financing correct?

My dealer told me they wouldn't know till tomorrow and she would give me a call. How did you find out? 2011 finance rates aren't even online yet. They only have 2010.
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      05-04-2010, 08:32 AM   #50
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Quote:
Originally Posted by PicassoM View Post
this is for standard 4-5 year financing correct?

My dealer told me they wouldn't know till tomorrow and she would give me a call. How did you find out? 2011 finance rates aren't even online yet. They only have 2010.
Yes. 4-5 year also.

I got the call at the end of the day. Around 5:30. Even the GM sent me an e-mail in the evening.

I don't think they will post 2011 rates online. Just 2010.
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      05-04-2010, 11:01 AM   #51
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Quote:
Originally Posted by comebackid View Post
Yes. 4-5 year also.

I got the call at the end of the day. Around 5:30. Even the GM sent me an e-mail in the evening.

I don't think they will post 2011 rates online. Just 2010.
can u please post the email?
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      05-04-2010, 11:08 AM   #52
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just called again and still nothing....

im funna raise the flag
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      10-31-2010, 02:20 PM   #53
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Quote:
Originally Posted by dimabimmer View Post
what is the point of this baloon payment financing? it still comes to same money of the sale price, more or less. isn't it easier to lease new, or finance cpo with hefty down payment?
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Originally Posted by buschy View Post
if you can put 20k down you should be able to do traditional financing and get a lower rate. that doesnt make much sense to do a balloon.
Three words.... Time Value Money. followed by a long winded explanation....

I'll take a balloon over putting up the money upfront any day for a few different reasons...

1.) It's my money and I feel way better in general if it's in my possession for as long as possibly possible.

2.) Currency depreciation. This happens; no way around it. So in the 3-5 years your balloon payment is due, the almighty dollah dollah bill may depreciate by as much as 20% (or more, who knows really these days) so effectively, the $20k you pay in 5 years will be worth much less to you at that point than it means to you today. You will also be making more money in 5 years. The banks and finance companies justify this by charging you interest year over year to offset for depreciation and yield some green for themselves. This brings me to my last point...

3.) Invest that large down payment into a compounding interest bearing account. Even though you are essentially investing with borrowed money, you're getting the money very cheap @ 4.25%. If you can yield anything higher than that PLUS reap the benefits of the magic of compounding, the rough numbers might look something like this.

Cost:
$20k down payment deferred to balloon payment in 5 years.
4.25% interest - $850/yr in interest; $4250 total (if they compound yearly, it will be more in the ballpark of $4626 in total interest paid)

Earnings:
Put that $20k into a mutual fund yielding 8.5% and compounding yearly (you may be able to find better rates with more frequent compounding, but we'll play it conservative)
Start with $20k principal -> earn $10073.14 in interest -> end with $30,0173!!!

So you made $5k by doing it this way, and that's not counting the money you save on payments or depreciation.

Or am I missing something?
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      10-31-2010, 03:59 PM   #54
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Quote:
Originally Posted by jonbiggs View Post
Three words.... Time Value Money. followed by a long winded explanation....

I'll take a balloon over putting up the money upfront any day for a few different reasons...

1.) It's my money and I feel way better in general if it's in my possession for as long as possibly possible.

2.) Currency depreciation. This happens; no way around it. So in the 3-5 years your balloon payment is due, the almighty dollah dollah bill may depreciate by as much as 20% (or more, who knows really these days) so effectively, the $20k you pay in 5 years will be worth much less to you at that point than it means to you today. You will also be making more money in 5 years. The banks and finance companies justify this by charging you interest year over year to offset for depreciation and yield some green for themselves. This brings me to my last point...

3.) Invest that large down payment into a compounding interest bearing account. Even though you are essentially investing with borrowed money, you're getting the money very cheap @ 4.25%. If you can yield anything higher than that PLUS reap the benefits of the magic of compounding, the rough numbers might look something like this.

Cost:
$20k down payment deferred to balloon payment in 5 years.
4.25% interest - $850/yr in interest; $4250 total (if they compound yearly, it will be more in the ballpark of $4626 in total interest paid)

Earnings:
Put that $20k into a mutual fund yielding 8.5% and compounding yearly (you may be able to find better rates with more frequent compounding, but we'll play it conservative)
Start with $20k principal -> earn $10073.14 in interest -> end with $30,0173!!!

So you made $5k by doing it this way, and that's not counting the money you save on payments or depreciation.

Or am I missing something?
I absolutely love your thought process. Very great and informative post!
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      10-31-2010, 07:12 PM   #55
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on the penfed website they quoted $74655 60 months loan at 946 and BMWFS had me on a Select for 869.
what is the advantage of the penfed?! im lost
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      10-31-2010, 10:52 PM   #56
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Quote:
Originally Posted by cavasoti View Post
on the penfed website they quoted $74655 60 months loan at 946 and BMWFS had me on a Select for 869.
what is the advantage of the penfed?! im lost
You will have a balance left on the BMW select terms
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      11-01-2010, 08:26 AM   #57
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How much $ down on that deal?
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      11-01-2010, 11:15 AM   #58
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Originally Posted by trendy26 View Post
How much $ down on that deal?
i dont know what deal ur talking about, but if it is the one I got, $3200 out the door with fees and first payment..
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