Hi guys, I'm looking to buy the 2006 G35 Coupe 6MT with Aero, Nav, Prem., and Sirius. My target price range for the vehicle is to pay $37k through aggressive negotiation and pitting dealers against each other for the best prices. I've done my research on how to negotiate the best prices, but the financing is still a big question mark for me.... I will explain

I know I definitely want ownership of the car in the very end whether it be through financing the car wholly or through leasing and opting to purchase the car at the end of its lease. I'm under the impression that if you choose to purchase the car, it will be cheaper in the long run, I also drive a lot so going over the terms of the lease in relation to miles is a primary concern. Please inform me otherwise if leasing is the superior and more cost-efficient route towards ultimate ownership.

Now assuming that I want to finance the car through a loan, I will need to give you guys a background of my 'financial risk profile' or whatever they call it in the financing industry .

I am actually buying a car because my old car was totalled in an accident that insurance assessed 100% liability to the driver that struck me, a pretty horrific accident to say the least. I was slightly injured, but more so, I was disappointed my car was totalled, I drove a 1997 Maxima 5-speed, a rare breed for its time, and that car drove with authority. To say the least, the Maxima was torn away from me, but now this leaves me to get a G35! which isn't a bad trade up, however I will still miss the Maxima.


I'm 24 years old and I'm currently attending college to pursue a bachelors degree in hospitality, I work at Angels Stadium pulling in about $15 an hour and since the season just ended I'm currently out of a job, however this allows for me to focus on my studies. I have an excellent credit history and recently when I checked my credit score through a friend at Ameriquest I recieved a 750+ rating, so at least I know my score is at the very worst 750. I currently have moderately high-limit credit cards issued under my name, about 4 cards with $5k credit limits.

Now my question is it possible to get the lowest APR for a loan given my financial history and my current job situation? I have money coming from the total loss of my vehicle of $7.2k and also $5k as an early graduation present from the parents. From my injury settlement I should recieve a minimum of $5k. I will be putting down $10k immediately for the car and I should have around $5k to use as vehicle finance payments. So figuring that the total cost of the vehicle would be approx $40k with TT&L (tax,title & licensing) I will have $30k to finance after I give them my down payment. Would it help if my dad, also a very excellent credit history, practically flawless, come with me to co-sign for the vehicle? I would rather save him the trouble of driving to the dealership, but if it will get me a lower APR it will most definitely be worth it. I'm looking to finance the car with a 4 year loan or the best loan where I get out paying the least in terms of total payments plus the cost of financing.

Anyone who got to this point of the post, congratulations, this post is damned long!

 

If you're 24yo and out of work then you'll be lucky if anyone gives you a loan for less than 10%, if at all, if you sign alone.

 

So basically I would most definitely have to co-sign, what kind of interest rates, I can get competitive rates if I co-sign? Or should I have the car under my dad's name?

 

If i were going to get a loan for 10% I'd actually be better off paying for it with my credit cards....

 

With a credit score of 750 you should definately qualify for the low interest rate. Here is the kicker though - the job issue will kill you here. Is there someone who could put you down as them paying you for doing any kind of regular work for them. My dad has his own electrical business and would likely be willing to put me down as doing desk work for him. Not a lie mind you as I am able to help out. Aside from something like that I would say you are in trouble.

If you go with a cosigner then you may be in more trouble - reason being that they will look at this person's credit score also and they will weigh it the same as yours. If they don't have as good or better credit then you will likely end up with a higher rate. Give a call to some banks in your area and especially your own bank and talk to them. Make sure they don't run a report just yet since everytime it is run it gives you a "black mark" for a short time. They should be able to answer most of your questions for you.

 

The bummer about getting a cosigner is you won't get the benefit of improved credit worthiness. This is an important consideration because your next big purchase may be a house and you'll want to have a strong credit history to qualify for the mortgage. Being burdened with high car payments and having a history of not making them on time would be a black mark on your future credit report. (I'm not saying it would happen, but it's a lot easier to get into credit problems if you're starting out a career and have big monthly payments to make. What if you were to get sick or injured? You could lose your job. I hate to sound like a jerk but life is full of uncertainties.)

It is my personal belief that you should try to buy a house or a condo before you take on the payments for an expensive car like the G35. Mortgage interest is one of the few tax deductions that individuals can take these days. And with a record of making regular mortgage payments, you will get a lot better offers for low interest loans than you will without the mortgage.

Sorry for making my opinion so long winded but I must add, if you can only see the windfall from your settlement on the totaled car, the injury settlement, and your graduation money as the income towards buying and paying for this car, I think you shouldn't buy it. I know you will get a job after graduation but do you really need the pressure of high monthly payments hanging over your head when you want the time to make an important decision regarding your future employment? (If you got the best 4-year rate Infiniti has offered in the past, 2.9%, your 4-year loan for $30K would create monthly payments of $662.70. Add to that the cost of insurance, maintenance, and gas and you could be easily looking at $1K per month.)

If you absolutely must have the car then I think you may want to consider more creative solutions for qualifying without the cosigner. Will your dad take out a home-equity loan, which you pay off? He could qualify for a better rate on that than you can on a car loan. This is risky for him but if you've proven to be a safe driver and someone who keeps their promises, he may be willing to take the risk. With a 5-year loan of $20K at a 7.5% rate, the monthly payments would be about $400. Add a 3-year bank auto loan of $10K at a rate of 5.5% and your additional payment is $301.96. Financed this way your total payments for the car would be $701.96/month (years 1-3) $400/month (years 4-5) and total $34,870 vs. the unavailable Infiniti loan (2.9%) $662.70/month (4 years) and a total of $31,810.

The big benefit of the scheme I've described above is you get credit for paying off a $10K auto loan. And you earn that credit in 3 years, not 4. Plus your monthly payments drop to $400 per month for years 4 and 5 when you'll want to sock away more cash for the home purchase.

You probably aren't in a position to qualify for a $30K loan in your current situation.

 

Thank you Cale, I'll be pursuing a different car because of you. I think I just needed to hear that from someone and realign my financial decisions with realistic ones.

Any suggestions for a good car for $10k?

 

Not $10k but for about $15k, a 2002 Subaru Impreza WRX sedan. Try to find a little old lady that's selling private party.

 

Hahaha, I think I'll just go with a beater for about 3 years and then buy a new one. In my area, we have plenty of little old ladies that drive them WRXs.
But seriously, automatic transmission more of a pain in the *** than a manual, in reference to my rental car...