I have no idea. I don't really care. I have never purchased a new car and probably never will (they're a complete waste of money!).

This girl scout is all about buying everyone else's cast of crap and making it work while saving for the things she really wants to have... , things she buys outright.

"Paid in full" is my second most favorite phrase.

Honda's running tv ads here for 2.9%. I don't think you'll ever get much lower than that.

Since there is an estimated 25% overcapacity in auto plant production worldwide, you'll get the best deals from manufacturers' incentive-based financing. You'll occasionally see zero percent financing, even. But that also means the better deals are on the less popular mfg/models.

Credit unions generally have lower loan rates than banks. One contributor here, Ole Joyful, uses his securities to float loans at low rates, but whether your local bank will do that is anybody's guess.

One person came on here a while ago to tell how she could have paid cash for a new car ...

... but didn't, as she got a loan from the dealer at 0% rate.

So left her cash invested, to earn money for her.

I'll bet that if she had her brother walk into that dealership the next day to buy the identical model, with cAsh in hand ...

... he'd have been able to negotiate quite a different price.

By the way ... I've never heard of a 0% interest rate on a dealer's loan on purchase of a used car.

I haven't bought a new car in 30 years (and then it was last year's model, after the new models came out). And have no intention of buying a new car, any time soon.

When I drive a new car home from the dealership, about 50 $100 dollar bills fly out of my pocket onto the street along the way. Actually, they don't - I left them at the dealership.

And when I pay interest on purchase of a car, the interest isn't deductible, but when I pay interest on a loan that I use to buy securities, that pay me a return, I can deduct that interest cost.

I like that deal better.

And if, having purchased the securities, you use them as collateral to undergird a loan to buy a car, you'll almost always be offered a much lower rate of interest than if you use the car as collateral. If you default, it's a great deal easier to liquidate the securities than to re-possess the auto and sell it.

ole joyful

So does the rate cut directly affect auto rates or not? I know manufacturers have deals (they always do).

The FED's action is going to have little impact on any loans except CC interest rates IF your card(s) are rate-linked (not all are). Some ARMs are rate-linked, but most are LIBOR-, not US Prime-linked.

If you finance a car, you should be able to get a near-zero rate given the backlog of unsold vehicles.

We're like some of the above posters. Haven't bought a "new" car in years. Have bought untitled or dealer demo prior year's models with extended dealer warranties. We trade in when a current car ages out of an affordable warranty, usually 10 years. Have never financed a car and would only do so if I couldn't get to work without financing one.

"One person came on here a while ago to tell how she could have paid cash for a new car ...

... but didn't, as she got a loan from the dealer at 0% rate.

So left her cash invested, to earn money for her.

I'll bet that if she had her brother walk into that dealership the next day to buy the identical model, with cAsh in hand ...

... he'd have been able to negotiate quite a different price. "

Ummmm...

Ed, that was me... and you would LOSE that bet.

The cash price was negotiated BEFORE the 0% offer came into play. I waited a week for delivery, and saw the ad on TV for 0%. When I went in to get my car, I told them 0% or no sale.

I got 0% at the cash price negotiated earlier.

muddbelly,

The Fed's rate cut is not going to affect car loans. Rates haven't changed & they'll likely not because banks still have to pay out the same in order to attract deposits. It's also not going to lower CC rates for the same reason.

The only ones who'll benefit from the cut are businesses whose loans are tied to prime, LBOs will benefit, intra-bank loans, etc. In other words, the big guys will benefit. The consumer will not.

So, let go of the idea that you're going to get a better auto loan next week...ain't gonna happen.

/tricia (who's spent her career as a banker & who's DH is #2 at a large regional bank & sets the bank's rates...he actually RAISED mortgage rates today on conventionals)

Looks like I lost a bet - rather unusual, as I seldom make bets.

However, I think that, while western pa luann appears to be an expert bargainer, her experience is unusual.

I still think that, in most cases, the after-negotiation price for a 0% deal will be different than for one for cash.

It doesn't matter to the likes of me, in any case, for, as I mentioned earlier, I've never heard of a 0% finanincing deal offered on a "used" (or is that "pre-owned"?) vehicle.

Also, a number of people who know the field rather well, don't recommend purchAsing extended warranties, either.

That doesn't affect me much, either, as I've bought vehicles that are over 10 years old, and they won't be offered on such.

And I use a mechanic out in the country, out of the big shop and high-rent district, and whom I've known for years, who fixes only what's needed, and doesn't charge an arm and a leg.

In fact, another friend (whose shop is in town), from whom I've bought some cars in the past, who did a major body job on my old car (that I didn't buy from him) eight months ago, was sure that he put new bearings into a wheel that he repaired as part of that fix. When the bearings wore out and were growling, he replaced them yesterday at no charge.

Good wishes for increasing skill at making your money work hard for you ... as hard as you did to earn it in the first place.

ole joyful

muddbelly,
Here's a partial answer to your question:

Auto Loans. A rate cut isn't likely to have a big impact on new-car loans in part because more than half of all auto loans are already offered at reduced rates due to heavy manufacturer incentives, says Art Spinella, president of CNW Marketing Research Inc. But the Fed's move could make it cheaper to get a used-car loan because many people turn to banks and credit unions to finance their purchase, he says.

Still, consumers could start seeing better financing deals if the Fed continues to cut rates. Auto-loan rates, generally tied to the movement in Treasurys, already had started to ease given the recent drop in Treasury yields. Average rates on five-year new-car loans are 7.72%, versus 7.81% on July 4, according to Bankrate.com.

Here is a link that might be useful: What the Rate Cut Means for You

my Heloc is going down, it is tied to prime.
Isn't most Helocs tied to prime? and if so then consumers will see some effect from this rate cut as lots of homeowners have Helocs in addition to their primary mortgage.

O.J. -- We were offered a low rate if we wanted to finance our current car. It was a "last year's model" dealer demo (whatever that means) with 2700 miles, titled six months before we bought it. It came with the original 4-year warranty plus an additional 2-year "dealer certified" warranty. We plan to buy an additional warranty after the six years are up; that worked well with prior car. We don't have a commute -- low miles per year -- so the add-on warranties are inexpensive. When it's time to trade, the maintenance and repair receipts from the dealer garage add value. If we can sell direct, we do, but if not, the dealer is famiiar with our car and we've gotten good value.

We've also bought used. There's always a good choice of "pre-owned" toys to choose from amongst luxury brands. The guy who needs a new car every six months provides us with a deeply discounted car we drive and enjoy for another ten years -- for many years it's been a Jaguar; currently their smallest X-Type.

joyful, I got an exceptional deal and it happened on a whim and when I really wasn't even looking to buy a new car. I was looking for a used Jeep that I could use mostly off road and for around town. I went by a dodge dealership to look at the used Jeeps. I start talking to a sales guy and he tells me he would give me an insane deal on a new Jeep. I told him ok, then give me a Rubicon $24000 out the door and 0% financing. He told me that was insane but to come back when the easy boss was there and he would see what he could do. I just figured it was a bs bait and switch tactic and left with no plans to return. The next day he counters with $27k out the door and if I qualify, 0% financing. He said he couldn't do any better because the Rubicon was a relatively new model (2nd year out) and was selling very well already. I told him no thanks, my offer was $24k and that was it.

About an hour later he tells me come get your Jeep. I told him if the bottom line price is even 1 penny over $24k I am leaving. I then also reminded him I wanted 0% financing. He said he has no control over that and that, it was up to the credit people. So I told him that the 0% financing has to happen or no sale.

So I go to the dealership to meet the sales guy. He writes up the deal and the manger signs the deal and just shakes his head. I go into the financing office and the guy says do you want 24, 36 or 48mos, zero financing. I asked him, why would anyone take anything less then 48. He laughed and said youÂd be surprised. And within 30minutes of the financing, I had my new Rubicon at an insane price.

So that day I got a 2004 Jeep Rubicon for $24000 out the door, no money down and 48months at 0% financing. When you factor in lost interest at 6% and all the taxes, title fees, etc, they sold me a Rubicon at roughly $19k(Dealer invoice was $26500 and retail was $29800). That is a whopping $7k below dealer invoice. I asked the sales guy why they would ever make such a deal. Here is what he told me and I donÂt know if its true or not, but it makes sense. He said that Arigo Dodge is a volume dealer and that while they donÂt like doing deals like mine, its all about the quantity of cars that they sell which determines how much they end up making per vehicle. He said he knew he could get the deal though because they were on the edge of the next volume discount level and that he was told in the morning to do what ever they had to, to get cars out the door.

I have always done well on buying new cars, with the exception of my M3, which was an impulse buy. I donÂt know if I would ever be able to get a deal like the one above again, but you can get a great deal from a dealer if all the stars line up

Actually we did purchase an extended warranty on our most recent new car, a Hyundai Santa Fe. We got the car at a terrific deal over the Internet - no hassling on price, it was fabulous; I'll never buy a car any other way - picked it up at a local car dealer and whizzed away in it 30 min later.

They're not quite as reliable as the Japanese cars we've owned (and the Fords, but we've had exceptional luck with ours) so we figured it was worth the small $1K price for a ten year bumper to bumper/free towing from anywhere safety net. And the dealer has been fabulous, on some small issues subsequently they wrote up the invoices so the factory would fully cover the repairs under warranty. Plus the warranty is fully assignable and refundable, not that it matters since we also drive our cars into the ground. Just got rid of the Ford Taurus with 122K on it, in fact, swapping it for my MIL's lightly used Buick Regal. A mediocre car, and my DH hates it, but I told him, hey, much as I would LOVE a MiniCooper, a free used car with only 54K on it is something we can't pass up!

But I always sigh over the Minis I see as I blow past them on the freeway, LOL.................!

Thanks triciae. I was asking about rates because I want to buy out a lease, and rates just aren't that good vs. new deals. I hoped holding out would improve my rate. I'm beginning to think it may be a better bet to buy new...

Generally you get a better or equal price for financing. The dealers make money on the financing much as mortgage brokers do! So assuming your credit is good they are thrilled to finance

If I don't buy and enjoy a new car someone else will benefit from my money when I die. I didn't save all of my life for someone else to spend it. I bought a Nissan Murano 3 months ago and I don't care how much I lost, the pleasure I have in driving , is it worth it. If my sons inherited my money, the eldest son would throw the biggest beer bust the state of Arkansas has ever seen, and my youngest would give the money to his wife to take care of and it would be gone in 6 months without anything to show for it. I recently sold my 5 year old Acura for $17,000., we paid $28,000 for it new. Bring on the new cars.

I've quit buying used cars because there just isn't that much of a discount on them anymore. For an extra $3-4000 over a used car price i can get a new car w/ full warranty. And get the best years of the car. The only ones that are really significantly discounted are several years old w/ a lot of mileage. No thanks. Been there, done that, never EVER doing it again.

The day that all 3 of our used cars were in the shop (in a 2-person household) I decided that I was through throwing good money after bad. New cars from now on, all the way. Now, that doesn't mean that I buy one every year. Our cars are 2000 and 2002. So sometime in the next couple years we'll have to start replacing them.

And no more Detroit cars either. The Big 3 must spend all their money on the CEO and lobbying Congress; they certainly don't spend it making quality cars. I know it's not American workers that can't build cars, since most Hondas and Toyotas are now built here, and they last forever.

Housenewbie, that is when my husband and I decided to buy new cars instead of used. It was years ago, but we looked and looked and for another $1,500., we could get a brand new car. As I said it was years ago. LOL

I'm with the new car people. I've spent too much time and money on used cars, plus I feel being stranded with a broken-down car is a safety issue.

Right after I bought my last car, I changed jobs and stopped driving much, so I still have that 1995 Ford Escort with about 70,000 miles on it. I paid off the 4.5% or something loan long ago. It's not pretty, but I keep it in good running condition and it still works fine (knock on wood ...).

DH has a 1997 Honda Accord that he bought new. It now has about 150,000 miles on it.

We haven't bought a new car in many years. We've had no "surprises", but then we've always bought cars that were 6 mos. to one year old, with mileages under 10K, with 4 to 6 year dealer warranties.

The last NEW car we bought I found online at a dealer in Troy, MI. Sent a driver up to get it and drive it home to Chicagoland. It was untitled, but the prior year's model. Drove it 10 years. Dealer gave us $8K when we bought our present 6 mos. old X-Type.

Perhaps we have been lucky, or it's just that we buy higher-end cars that the first owner has "tired of". One of my favorites had been repossesed before we bought it!

Our DS swears by Hondas. They do seem to keep going forever!

My last 3 cars cost me around $7,200. total (less insurance settlement of $2,000. for one) plus substantial repairs).

In mid-'97, bought a '90 Colt hatch, standard tranny, $2,600. or 2,700., ran 8 years, took a substantial amount of fixing, more than I'd paid in the first place, especially near rhe end.

In early '06, '93 Taurus wagon cost $2,000., ran less than a year, almost no trouble ... hit in the back end by a gravel truck. Scrap. Insurance co. paid what I'd paid, most of a year earlier.

In early '07, bought '88 Mazda 323, standard tranny, hatch, $2,500.

Five months later it appears that I ran a red light, was hit driver's side at rear wheel, cost something over $3,000. to fix it, which I paid, as no insurance - my-fault accident, I carry no collision insurance.

I figure that my current car may last through the remaining years of my life.

If not, I may buy a newer car next time, as I'm getting too old for the hassles of messing around with cars that aren't there when I need them, even occasionally, hitchhiking home from repair shop if good weather, etc.

And, until a year or so ago, I had an '80 Ford Econoline van that I bought in '90 for $1,000. when I sold corn-fired heaters, that I could use when the car wasn't operational ... sold to scrap yard for $180.00.

Paid cash for all of them.

ole joyful

Chisue - I hope your DS is right, because 5 mos. ago I traded my barely functional old Cavalier (that cost me almost as much at the shop as I paid for it the first year!) for a new Honda Fit. I didn't have much money at all to spend (also had to quickly find a new place to live), but I was determined to not give it all to the bank. It's an auto, but otherwise pretty generic - no air (summers shortish and I'm not on the road enough to matter - and the windows work :-) because it would have meant also paying for cruise ctl. I live in the middle of nowhere around twisty up and down roads, and my car just sails along! I will never finance (or get another old heap again) and I hope to keep this one for a long, long time! My previous 'new' car was a (1st yr out) l990 Mazda Protege, and it lasted 14 yrs before I decided not to put any more $$ into it (used it to trade for the Cavalier). I LOVE my Fit!!

Different strokes for different folks, I guess!

I do feel somewhat apologetic toward North American auto workers, for two of my recent vehicles have provided jobs for Japanese workers.

On the other hand, having seen life in disadvantaged parts of the world, I can't object to people there having opportunities for decent employment, either.

I grew up at the tail end of the Great Depression ... and lived for ten years among people who'd walked away from their previous life in the clothes that they stood up in ... and if you think that it's easy to find work in a country where modern war had swept over most of it four times in about three years, with all of the disruption of industry and commerce, apart from the ordinary aspects of living, that that produces...

... think again!

I'm surprised that the Koreans don't hate the Russian and the U.S. governments from the core of their souls - for they were the ones who split that country.

ole joyful