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Well I'll Be Dipped!!!
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You’re ALSO an extended warranty consumer?! This conversation is clearly a lost cause. Good day.
Keep listening to your financial gurus, rather than actual experiences people have.
 

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If you're someone who is NEVER without a car payment because you trade in and get a new car that often...then you might as well do it.

For those of us that think 100k miles is just "broken in" and like to go years at a time without a car payment. That would be a no.
And to add....I don't buy new cars. I get something that's got 20-40k on it and generally stick with Toyota products. That gets me a car for 60-80% of the sticker price with 80% of it's life still left. Then they become hand-me-downs. I have one kid driving an Avalon with 220k miles and another in a Lexus 350 with 240k miles on it. 1 rack and pinion and 1 AC compressor have been the only costs over the last 4 years besides general maintenance.
 

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And to add....I don't buy new cars. I get something that's got 20-40k on it and generally stick with Toyota products. That gets me a car for 60-80% of the sticker price with 80% of it's life still left. Then they become hand-me-downs. I have one kid driving an Avalon with 220k miles and another in a Lexus 350 with 240k miles on it. 1 rack and pinion and 1 AC compressor have been the only costs over the last 4 years besides general maintenance.

I'd love to find a Tacoma for 60-80% off sticker with 20-40K on it. Not happening here.


Used Tacomas might be discounted a grand or three from new prices.
 

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Do your own investigation yourself.

Ford and Toyota offer genuine 0%, where the missing profit from the missing APR isn't recouped in higher sales prices. They're the only two manufacturer financing arms that do that, all the rest are bull****.
So it is sort of like Genuine imitation leather! :animlol:

Well one thing I know for sure - 100% - when Toyota or Ford credit set up the loan on their books it will have interest factored in - when you make a payment and they record it on their books part of it pays principal and part of it pays interest. You agree with that don't you? I mean how could you not?

Yes - Toyota (Ford) manufacturing side takes a smaller profit on the sale so that Toyota Credit can book this interest - the way the accounting rules work they must do it this way -

I am sure the auditors at Toyota and Ford would not allow loans to be set up without interest.

So sure - just like the free pair of shoes - you can say it is really zero interest if you want and it will say that right on the loan paperwork. But what goes on the company's books will tell a different story.

So I will say you can look at it any way you like - just like the buy one pair of shoes and get one free - same thing really - it is just a marketing program -
 

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You’re ALSO an extended warranty consumer?! This conversation is clearly a lost cause. Good day.

I have never bought the extended warranty - I think in total I am ahead - but once in a while I get hit - and think - I would have been better off with the warranty -

Same thing with road hazard coverage on tires - I always decline - but have had a few tires get destroyed where the road hazard would have covered it - so that time I would have been better off - but in total still think I am ahead.
 
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Well I'll Be Dipped!!!
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One time I wasted the money on an extended warranty. I have owned three vehicles since that particular one that I didn’t buy a warranty and had I it would have been a waste. You have just been terribly lucky or unlucky depending on how you look at it. Think about it, if the extended warranties ended up in the buyers favor very often they wouldn’t offer them or push them. They do it because overall they make a killing. Hell I used to pay for them on my cell phones but realized that they are so expensive these days that with four lines when you add the deductible in I was basically paying for a cell phone each year no matter what. How stupid is that. I get it life is a gamble but I will continue to play the odds.
We're not talking about cell phones here. We're talking about assets worth tens of thousands of dollars.

Your thinking like an extended warranty newb. You don't buy them when you buy the car, rolling it into the financing. You buy them, in cash, just before the factory warranty is set to expire. That way if you sell the car before the factory warranty expires, you lose nothing.

I've gotten Ford's ESP, directly from Ford in Dearborn, twice. Averaging right around $1100.00 for an additional 3 years of bumper-to-bumper coverage, on Mustangs 1 & 2.

On Mustang #1 I used it time and time again, it saved me big $$. On Mustang 2 it again saved me some money, but only a little compared to Mustang #1. Mustang #3 I traded in before the factory warranty expired, so I never bought it.

If I keep my current Mustang, I'll do what I've done in the past. I'll call Ford ESP with my card in hand when there's 35,999 miles on it, and get the warranty extended.

If you do it right, it's a great financial tool. Do it wrong, as part of the vehicle purchase, and you're much more likely to get ****ed, or even waste it completely.

This is all about knowledge, and doing your homework. Knowing how, when and from whom to buy one. Including paying extremely close attention to what is covered. If you're smart, by the time the 3 year/36K miles are up, you'll know exactly what the known issues are with your vehicle, and you make damn sure those components are covered. If need be, you get that **** in detailed writing.

And if by the end of year 3, if it turns out your car is the epitome of reliability, and there's no known issues, just skip it altogether. Being a member of a car specific forum is key to that part.
 

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I'd love to find a Tacoma for 60-80% off sticker with 20-40K on it. Not happening here.


Used Tacomas might be discounted a grand or three from new prices.
Yeah, that's a problem here too because they are in the Truck category. Just about any kind of truck has a super high resale here. It's crazy. Over the last couple years it's even that way with cars if they are a Toyota or Honda. People have figured out that 300k miles with no breakdowns is pretty common.
 
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The way I look at extended warranties -

On average they must be charging more for it than the expenses they incur -

So if the extended warranty costs $1K -- and they sell it to 100,000 different people - on average the repair bills would maybe be $650.

Some may have $15,000 in repairs, some $5,000 - but many will have almost zero $ in repairs -

I think in this case - if you are really hard on your vehicles - or drive in very harsh conditions - maybe an extended warranty would be a good idea -

Or if a really big repair bill would wipe you out - paying $1,000 may be worth it to avoid the possible $6,000 blown engine -


But for most people that drive in normal conditions and have a little set aside in savings - buying the warranty would on average cost you money.

Sort of like how big of a deductible do you want on your car insurance - or do you even want to buy full coverage?

From memory - could be off a little - we jacked up the deductible - I think to $5K from $2.5K - and it lowered the premium almost $500 a year --

Same thing with homeowners - we put on a $25K deductible - but in that case I think it will take more like 15 years without a major claim to be "ahead". We have been in this house for 30+ years - never had a claim -- so we are way ahead - but sometimes I think I should maybe lower it - at some point a hurricane is going to do some damage.
 
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Well I'll Be Dipped!!!
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So it is sort of like Genuine imitation leather! :animlol:

Well one thing I know for sure - 100% - when Toyota or Ford credit set up the loan on their books it will have interest factored in - when you make a payment and they record it on their books part of it pays principal and part of it pays interest. You agree with that don't you? I mean how could you not?

Yes - Toyota (Ford) manufacturing side takes a smaller profit on the sale so that Toyota Credit can book this interest - the way the accounting rules work they must do it this way -

I am sure the auditors at Toyota and Ford would not allow loans to be set up without interest.

So sure - just like the free pair of shoes - you can say it is really zero interest if you want and it will say that right on the loan paperwork. But what goes on the company's books will tell a different story.

So I will say you can look at it any way you like - just like the buy one pair of shoes and get one free - same thing really - it is just a marketing program -
Do your own investigation, as it's assumed you won't believe me. Ford and Toyota are the only two manufacturer's financing arms that do a genuine 0%.

Not all the time, usually only late in the fall, but they do do a real, genuine 0% (for 72 months) where the lost profit isn't accounted for elsewhere, like by raising the cost of the vehicle, or not discounting them as much.

Which, as odd as it sounds (at least to me), Ford hasn't done this year.

Understand; the car buying experience is different from one part of the country to another, and one dealership to another. I myself am lucky to live where I do, where Fords are sold at the cheapest prices on the planet, including 0% on top of massive discounts off MSRP. And the 0% isn't offered across the country, only in certain areas at certain times.

To give an example, since you live in Texas; on the Mustang forum I am a member of, we have tons of people join to ask about the prices they're being offered at their local dealerships. For whatever reason, in California they might get $1200-$1500 off a 5.0 GT. Here in NoVa, we get several thousand off in the fall. I got over $7K off (plus 0% for 72 months) my current car last fall. But in California? Nope. So lots of people in Cali buy their cars here and have them shipped across the country, or fly, buy and drive them home.

Again, it's all about doing your homework, and also being patient. When I got my current car, I waited several months for the 0% to finally happen. Hell, I got lucky, really.
 

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Do your own investigation, as it's assumed you won't believe me. Ford and Toyota are the only two manufacturer's financing arms that do a genuine 0%.

Not all the time, usually only late in the fall, but they do do a real, genuine 0% (for 72 months) where the lost profit isn't accounted for elsewhere, like by raising the cost of the vehicle, or not discounting them as much.

Which, as odd as it sounds (at least to me), Ford hasn't done this year.

Understand; the car buying experience is different from one place to another, and one dealership to another. I myself am lucky to live where I do, where Fords are sold at the cheapest prices on the planet, including 0% on top of massive discounts off MSRP.

How would anyone "investigate" this?

I think I understand what you are saying - or what you believe to be the truth. Is it really a true lower price - and I will say, yes it sure can be. It is like most marketing promotions - it gives you a break on price.

But do you also understand that when Ford Credit records your loan - it will not be treated on their financial statement as a zero % loan?

It will work like this - say you take out a 48 month, $500 a month 0% loan for $24,000 using Ford Credit.

When Ford Credit makes the loan they will book it as a 48 month, $500 a month 3.0% loan for $22,589.34. I am guessing at the 3% - it could be 2.5% interest rate with a loan amount of $22,816.43 or even a 2% interest rate with a loan amount of $23,046.65.

And when you make your first payment on this 3% loan Ford Credit will say - you paid $443.53 against the principal - reducing it from $22,589.34 down to $22,145.82 and they will also book $56.47 in interest income.

Now you can claim you didn't really pay that interest - that Ford - the manufacturing side of the business paid it - and I would understand where you are coming from.
 

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Well I'll Be Dipped!!!
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....do you also understand that when Ford Credit records your loan - it will not be treated on their financial statement as a zero % loan?....
Your point above raises an interesting question;

Would the detailed financial statements containing retail loan information be public information?

It's been an accepted, established fact within the car-guy & gal community that Ford & Toyota were the only two manufacturer's lending arms that do a true 0%. But how would one actually know that?

I'm guessing it's info someone that worked at Ford Credit leaked in the past.

Anyways, call it what you will, it represents a massive discount. 'uge.
 

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I've not paid a cent in financing charges over the last 11 years and 3 new cars. Not one cent. And each car was deeply discounted off MSRP. In each car, I had serious equity (thousands) after the 2nd year. On my last car, I had 7K in equity when I traded it in after 2 years, at 0% financing.

And I've had $0 in repair bills, because warranty. A few oil changes and some tires. Nothing else.

It's about where you buy, and how you buy, and doing your homework.
It's your money, spend it your way.
Here's mine:
- Buy a used car for $15,000 cash.
- Liability ins. only. Saves $500 per year in ins. cost X 11 years = $5500 saved
- Yearly taxes are less each year. $60 per year X 11 years = $660 saved
- Repairs. $2000 spent over 11 years.
Comparison:
I've spent $17,000 on my car over 11 years.
You've spent $500 per month X 11 years = $66,000. Plus you've spent $5,500 more on ins. and $660 more in taxes than I did. (I assume we both spent roughly equal money on scheduled maintenance.)
So, $72,060 - $17,000 = $55,060 that I spent less than you did.
 

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There are more important things to some people than having the lowest overall cost on a vehicle.

Some guys drink cheap booze even if they could pay more - it is not worth it to them.

Different strokes for different folks.
 

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Your point above raises an interesting question;

Would the detailed financial statements containing retail loan information be public information?

It's been an accepted, established fact within the car-guy & gal community that Ford & Toyota were the only two manufacturer's lending arms that do a true 0%. But how would one actually know that?

I'm guessing it's info someone that worked at Ford Credit leaked in the past.

Anyways, call it what you will, it represents a massive discount. 'uge.
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upload_2020-10-21_12-50-35.png
 

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It's your money, spend it your way.
Here's mine:
- Buy a used car for $15,000 cash.
- Liability ins. only. Saves $500 per year in ins. cost X 11 years = $5500 saved
- Yearly taxes are less each year. $60 per year X 11 years = $660 saved
- Repairs. $2000 spent over 11 years.
Comparison:
I've spent $17,000 on my car over 11 years.
You've spent $500 per month X 11 years = $66,000. Plus you've spent $5,500 more on ins. and $660 more in taxes than I did. (I assume we both spent roughly equal money on scheduled maintenance.)
So, $72,060 - $17,000 = $55,060 that I spent less than you did.

That's fine if you don't do anything but drive to the grocery store and back. If I had an 11 year old car it would have ~440,000 miles. Some of us pay to have reliable transportation. For some that's a vehicle every 4 or 5 years and VERY few folks will have cash to buy that new car every 4-5 years. That means a payment and full coverage insurance.

It is very much situationally dependent.
 

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Your point above raises an interesting question;

Would the detailed financial statements containing retail loan information be public information?

It's been an accepted, established fact within the car-guy & gal community that Ford & Toyota were the only two manufacturer's lending arms that do a true 0%. But how would one actually know that?

I'm guessing it's info someone that worked at Ford Credit leaked in the past.

Anyways, call it what you will, it represents a massive discount. 'uge.
Because everyone knows that car-guys are the best source of the internal financial dealings of captured financial subsidiaries of auto companies! :bunny:

I don't have any special knowledge about Ford or Toyota - but really doubt they are any different.

I will venture a guess about Toyota - they are known for being pretty tight with the rebates and special programs - so in the rare case where they are offing a deal - it could sure be seen more as a "real" discount - simply because they don't normally have giant rebates across the whole product line.

Not like GM and Chrysler - they are total whores - but I sure see Ford more like GM & Chrysler - willing to do whatever smoke and mirror deal that can clear the showroom.

I have not followed any car company for a long time - but I use to track them pretty close because I bought a lot of GMAC and Ford Credit bonds.

Back then it seemed like the auto manufacturing -really didn't make any money - and it was the finance company that brought home the bacon. They didn't do this by making below market loans -

But you know things in finance are now about as crazy as I have ever seen them -

A Danish bank was actually making negative interest rate mortgages - may have also happened in a few other places - crazy.

Take out a $360,000 mortgage for 30 years - pay back $995 a month for 360 months - only pay back $358,200 but you are considered to be paid in full.

Tells you how manipulated the financial world is -- but it is what it is.
 

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That's fine if you don't do anything but drive to the grocery store and back. If I had an 11 year old car it would have ~440,000 miles. Some of us pay to have reliable transportation. For some that's a vehicle every 4 or 5 years and VERY few folks will have cash to buy that new car every 4-5 years. That means a payment and full coverage insurance.

It is very much situationally dependent.
Whoa! That's about 30 days a year in your car! I hope you're getting paid while driving!!
 

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Whoa! That's about 30 days a year in your car! I hope you're getting paid while driving!!
Windshield time is about half my work day.
 

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That should give you a whopper of a tax write off every year!

It use to until Trump changed the tax laws.

The TCJA eliminated this deduction entirely starting in 2018 and continuing through 2025. This means that if you're an employee who drives for work you may not deduct any of your car expenses on your personal tax return. You should seek to have your employer reimburse you for your work-related mileage.
 
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