I got pre approved for Navy Fed Auto loan. The term is 84 month $27,500 loan with 9.49% APR $450 monthly payments. Total repayment $37,803. I am active duty heading to my first duty station if that matters.
My credit score is 750 but I had it under 5 years
Thank you all for the response. I’ll settle for used Honda civic or maybe electric bike.
Is this good auto loan terms?
byu/youngnebsi inMilitaryFinance
Posted by youngnebsi
16 Comments
No it’s not.
I just got a 50k auto loan with them for 5 years at 5.3% and I was disappointed that it wasn’t 5%
Unfortunately, that’s the going rate. However – do not finance for 84 months. Should be nothing more than 60 months, hopefully less. Why do you need a $28k car? I’m assuming you’re enlisted?
9% seems really high. But I haven’t been in the market but I would check with local credit unions and major banks as well
9.5% is kinda high, but you didn’t specify what your credit looks like. if you’re young, with not much history, then this is the going rate. but you shouldn’t be going into an 84 month loan. your car will be underwater for most of it, and that’s a really long time. stay under 60 months. do at least 10% down payment. if you can’t afford that, you can’t afford that card yet. and that’s ok. keep on saving money, get your promotions. you’ll get there eventually.
I would not do this ever. That rate is high, but a car with a deal for financing on a new car (like 4% for 60 months). You’d be a lot better off
$27,500 is a lot of money for a vehicle. My husband has been in the military, and I have been a working spouse for over 13 years. We have never had a vehicle that expensive, and we bought a brand new car last summer. To each his own, but now that we’re in our mid 30s I’m so grateful we did not spend a lot of money of depreciating assets like cars and instead started saving and investing early.
That might be the going rate but that is very high. And it can really start a cycle of financing cars in the future.
Are you going to be living in the barracks? Going to the field/CTC/deployments much? If that’s the case, you might be better off not buying a car at all.
You didn’t mention it, but some good rules of thumb are never buy a new car (the immediate depreciation is not worth the “newness”) and always buy your car in cash.
For reference, I’m an AD O-4, 20 YIS, I make $230k/yr and I drive a paid-off 12 yo Jeep Wrangler worth less than $10k, I won’t buy a new car til I’m retired or finance a car ever.
No
7 years of pay off a car is absolutely nuts. Do not do that.
The 9.49% APR is the going rate for someone who’s young without a long credit history.
84 months is backbreaking and it’s a sign that you’re buying a car you can’t really afford.
If I could talk to my 21 year old self who maxed out 3 credit cards for a down payment and financed a rebuilt title Mustang at 14% for 72 months, I’d convince myself to just get the $5K car until I got a couple promotions, trust me they’ll come fast!
That’s a horrible deal. Too many people stay poor because they buy things they can’t afford. If you can’t afford to pay cash for a vehicle, you can’t afford it.
If you absolutely need to finance to get a vehicle to get to and from work, use the 20/3/8 rule to avoid making a huge mistake.
20% down payment. 3 year term. Payment no more than 8% of your monthly income.
But the best interest rate and you should never do an auto loan over 72 months.
It seems pretty high, I’d see the dealerships offer to compare.
Yikes
Literally looking through this right now for myself. Seek a shorter term at a lower rate. A $50 more a month is easier when it’s saving you a couple thousand in interest.
It’s fuckin dogshit lol