Tuesday, April 1, 2014

$200 to make a point?

Alright, I applied to an auto loan yesterday while searching for info. The loan is through PNC, and the gal I chatted with online was very nice and informative. We processed the loan right there, and I got a reply back in an hour; I was approved for my requested amount ($6000, I'm putting a $4k down payment) over 48mo. Don't worry, I intend to pay it off within less than 32 months.

Speaking of interest... I was shocked when I reviewed mortgage info two years ago, and was completely appalled how expensive mortgages are. In comparison, auto loans don't charge you almost twice the loan price on interest. That $6k loan will only be, at a max, $500 over 4 years, or a little over $10/mo for the life of the loan, assuming I pay it off on schedule and not earlier. I will confess, that's not bad at all. Yes, I'd rather pay no interest, but putting it in perspective... not bad.

Anyway, back to the topic. So the PNC loan was 4.59% for 48mo, $137.06/mo payments. That fits me nicely. Then I went looking into more private party auto loans out there, and I'm surprised there are not many... and those that are out there aren't that great-- about the same APR. Bank of America, on the other hand... they advertise interest as low as 2.59% for the same amount, same term.

Now, let me say this. I hate Bank of America. They were "my" first credit card debt (opened by mother). It sucked SO much money out of me prior to 2012, in overdraft fees (checking), over limit fees, interest... I didn't even total it because the amount was just scary. However, I still have said checking account and credit card. They closed my savings account due to non use, which is fine, because all they offered was a sad 0.10% interest. My credit card was converted from a points based car to one that pays me $30 every quarter just to charge something and pay it off every month, without incurring any interest charges. Works for me. It's also my oldest, so 9 years of good payment history would go if I close the card, which may be a bad idea at the time being.

Back to the loan; I am hesitant to apply. I am not guaranteeing that I will be approved for the very low APR auto loan, but even if I did, I hate BOA. I am willing to risk paying $200 extra JUST not to do business with them. If I were to wait the whole 48 months to pay the auto loan, PNC's total would be $6578 vs $6336 BOA (assuming I get the lowest interest rate). Now, I have to step back a little... am I just being spiteful with my money? Isn't it that savings is savings regardless? Then again, I am someone who has been boycotting Walmart for years and only use them if I must, with my parents, because they're one of two groceries left in town... but is my stubbornness and unwillingness to deal BOA out of principle foolish, or perhaps someone else feels the same way towards certain companies?

9 comments:

  1. Is there any way you can join a credit union? I have found that there rates are always a little better. And truthfully I hate BOA so much that I would not give them a cent of my money for any reason. I would just work extra hard to find a way to make up the 200.00 difference and pay PNC back sooner. But thats me. Like I said I HATE BOA

    ReplyDelete
    Replies
    1. I've looked at some credit unions, but very few offer private-seller loans. I didn't know these would be so difficult.

      Delete
  2. I banked with BOA years ago and I really liked them. Shop around with a regional bank for a good rate. In our area, the regional banks have the best rates.

    ReplyDelete
  3. I would not give BOA the time of day. I've commented before (and posted) on my hatred of that bank. My auto loan is 4.9% (from 4 years ago) from a Federal Credit Union. That's my go-to financial institution for auto loans, though now that I am with a new, regional bank, and VERY HAPPY with them, I would give them a try first. Yes, $200 is $200, but I think you can match the rate elsewhere and avoid BOA. You shop for loans the way you shop for anything else - comparatively.

    Peace <3
    Jay

    ReplyDelete
    Replies
    1. My search continues. Glad I am not the only stubborn one. I'd rather deal with BOA as little as possible.

      Delete
  4. Capital One should have the same rates and you can apply online...

    ReplyDelete
    Replies
    1. They were my first try, but they don't offer private party loans.

      Delete
  5. Have you decided to purchase your brother's car for sure? Just curious :)

    ReplyDelete
    Replies
    1. At this point, yup! Still playing out the details.

      Delete