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    Cash or Loan?

    Are there any good perks paying cash for a new car? Or is it better getting a loan?
    I know, loan interest.

    #2
    It's cheaper to pay cash vs financing it. That's a good perk

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      #3
      I personally think it’s stupid to pay cash for a vehicle IF you have good credit and can get a respectable interest rate. Save the cash and let it make you money somewhere else.

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        #4
        If you're going to do cash, you can probably actually do better by financing it and then paying the loan off right away. Dealers make money off the loans, so they'll often times give you a little better price if you finance it (dealer incentives, etc). Just make sure no pre-pay penalties, etc.

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          #5
          Originally posted by BitBackShot View Post
          If you're going to do cash, you can probably actually do better by financing it and then paying the loan off right away. Dealers make money off the loans, so they'll often times give you a little better price if you finance it (dealer incentives, etc). Just make sure no pre-pay penalties, etc.
          GMAC just had a promo for an extra $2,000. off if financed through them on new HD trucks.

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            #6
            Why would you tie up 40k of your cash in a vehicle if you can get a 0% interest loan at certain times of the year? Or hell even 2-3% loan? Put just enough down to buy the vehicle invest the rest and you will end up making money over the life of that truck. Not unheard of right now to make 5+% on investments that would give you 2-3% return on your money while paying off your truck.

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              #7
              Originally posted by BitBackShot View Post
              If you're going to do cash, you can probably actually do better by financing it and then paying the loan off right away. Dealers make money off the loans, so they'll often times give you a little better price if you finance it (dealer incentives, etc). Just make sure no pre-pay penalties, etc.
              This. I get the loan specifically for the incentives. Once the pre-pay penalty period is up, I pay the vehicle off.

              Just don't get sucked into "oh my vehicle only costs me this per month so why even pay it off". I think dealers/financing companies bank on this, and eventually get all their money back and more because people get used to that car payment.

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                #8
                Balance the incentives vs the security and knowledge that your car is paid off... that is a tangible benefit

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                  #9
                  I have a 0% apr on my car and cash in the bank. Nothing wrong with financing at a good rate and keeping your cash squirreled away. On the other hand, if you can get away with buying a cheaper cash car that fits your needs, nothing wrong with that either.

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                    #10
                    If you get 0%, make payments.

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                      #11
                      Lets flip this for a second, you pay cash and you have no car note, which is money right back in the bank. I think most finance because they dont have 40k sitting around to buy something new.

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                        #12
                        Depends on your interest rate. If you can get the loan at .9% or some crazy low interest rate like that, then that frees up your cash to work for you instead of just getting tied up in a vehicle.

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                          #13
                          If the interest rate is low I would finance. I am a strong believer in liquidity.

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                            #14
                            Well not a rich guy with a Rolex on my wrist. (Don't own a watch or cell phone) But you can't take that money with you. Can't see having payments. Thought I would ask. At my age I don't buy GREEN banana"s.

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                              #15
                              I think the sound financial advice is that if you can make a better ROI by investing that cash then you should finance. That being said not everything can be summed up by ROI. I like the thought of being debt free enough that I would rather have it paid off.

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