Auto lending has changed some in 5 yrs, any recommendations?

[TimmyTightWad]

I contacted my credit union thinking the process would be easy like last time (about 5-6 yrs ago). I'd get a preapproved blank check at a rate under 3% and I could just walk into a dealer with the "cash buyer" leverage.
The credit union agent told me they don't do that anymore, I'd have to present them with a bill of sale before they even guaranteed my rate  :/
The lowest rate they offered was 3.5% which I thought weird since I'm seeing some dealers claim rates as low as .9% and 1.9% if you get their Certified used cars financed through them.
Maybe my credit union just sucks now.

Is there a lender recognized for low rates and good service now days? Any idea where I can look to compare with minimal hits on my credit?
Thanks

[JLee]

https://www.penfed.org/

They'll mail you a blank check (limited up to your approval amount) that you can fill out once you select a car and know your purchase amount. You'll have to call them so they can check book value and ensure that the collateral is sufficient, but overall their process is incredibly easy.

[Zamboni]

This is an obvious facepunch, but you shouldn't buy a car if you don't have the money available.

[jps]

This is an obvious facepunch, but you shouldn't buy a car if you don't have the money available.

One shouldn't spend all of their money on a vehicle, let alone more than all of their money on a vehicle. Just pay cash.

[dogboyslim]

This is an obvious facepunch, but you shouldn't buy a car if you don't have the money available.

I will note that the decision to borrow money doesn't always mean the individual doesn't have the money available to pay cash.

[TimmyTightWad]

This is an obvious facepunch, but you shouldn't buy a car if you don't have the money available.

I have the money to buy the car i'm looking at several times over with cash.  Why would I use cash when I can get low rate from somewhere?

[TimmyTightWad]

https://www.penfed.org/

They'll mail you a blank check (limited up to your approval amount) that you can fill out once you select a car and know your purchase amount. You'll have to call them so they can check book value and ensure that the collateral is sufficient, but overall their process is incredibly easy.

Thanks I always see this place mentioned for credit unions. I think there is a reason why I joined my CU instead of penfed though.....
Need to look into them.

Edit: Looks like they have worse rates than my credit union.

[JLee]

This is an obvious facepunch, but you shouldn't buy a car if you don't have the money available.

Would you withdraw funds from an investment account to save 3.5% in interest?

[Zamboni]

^Yes, because borrowing money over a long time period to pay for a rapidly depreciating item that generates no cash flow is textbook poor financial management. Why would I want to pay extra to the bank every single month for years to simply own something as inexpensive as a car?

[beltim]

This is an obvious facepunch, but you shouldn't buy a car if you don't have the money available.

^Yes, because borrowing money over a long time period to pay for a rapidly depreciating item that generates no cash flow is textbook poor financial management. Why would I want to pay extra to the bank every single month for years to simply own something as inexpensive as a car?

The more obvious face punch is spending 10% to save 3%.

The reason you pay 3% to the bank is to get larger investment returns.

If you don't want to do that because you want to avoid debt, that's fine, but don't go around face punching others because they want to earn more money.

[Fishindude]

Set up a line of credit with your bank, then you can get money for anything you want anytime you want.

[Zamboni]

This is an obvious facepunch, but you shouldn't buy a car if you don't have the money available.

^Yes, because borrowing money over a long time period to pay for a rapidly depreciating item that generates no cash flow is textbook poor financial management. Why would I want to pay extra to the bank every single month for years to simply own something as inexpensive as a car?

The more obvious face punch is spending 10% to save 3%.

The reason you pay 3% to the bank is to get larger investment returns.

If you don't want to do that because you want to avoid debt, that's fine, but don't go around face punching others because they want to earn more money.

Yes, yes, that's financial genius right there.

I'd agree with you if
1. It was really a super low rate (sometimes you see as low as 0% on car loans . . . but perhaps those have a catch?)
2. We weren't talking about rates of 3.5% and UP on a depreciating item that can't be sold for the loan amount shortly thereafter, and
3. I hadn't seen so many instances of people underwater on their car loans, or facing the financial pressure of "too many bills to pay."

I'm sure you've personally got it dialed down and can manage a car loan just fine even at 3.5%, but I'm still going to face punch people who come here asking about car loans. This is the MMM forum after all, home of the "rolling sofa" description of clown cars.

[JLee]

This is an obvious facepunch, but you shouldn't buy a car if you don't have the money available.

^Yes, because borrowing money over a long time period to pay for a rapidly depreciating item that generates no cash flow is textbook poor financial management. Why would I want to pay extra to the bank every single month for years to simply own something as inexpensive as a car?

The more obvious face punch is spending 10% to save 3%.

The reason you pay 3% to the bank is to get larger investment returns.

If you don't want to do that because you want to avoid debt, that's fine, but don't go around face punching others because they want to earn more money.

Yes, yes, that's financial genius right there.

I'd agree with you if
1. It was really a super low rate (sometimes you see as low as 0% on car loans . . . but perhaps those have a catch?)
2. We weren't talking about rates of 3.5% and UP on a depreciating item that can't be sold for the loan amount shortly thereafter, and
3. I hadn't seen so many instances of people underwater on their car loans, or facing the financial pressure of "too many bills to pay."

I'm sure you've personally got it dialed down and can manage a car loan just fine even at 3.5%, but I'm still going to face punch people who come here asking about car loans. This is the MMM forum after all, home of the "rolling sofa" description of clown cars.

1) I haven't had a loan above 4% (actually probably 3.5%) in many, many years. General consensus here (check the investment order thread) is that debt under 4% is not worth an accelerated payoff.
2) It doesn't matter what the collateral is (or if there is collateral or not).  For someone with investments (i.e. most people here), a 3.5% unsecured loan is the same as a 3.5% loan secured by collateral. The only complication here is if you're financing a car, you're required to have comprehensive and collision coverage on it. If you weren't going to do that anyway, then it is an additional cost.
3) Irrelevant to the discussion.

[Villanelle]

Find a dealer that will take a credit card for some or all of the total, and use this to get a zillion miles and other CC perks.  And/or find a 0% interest card.

Even if you can only put part of it on a card, this seems the way to go.  If it's not 0% (or super low), pay that off right away but get points and miles for it.  Those benefits, if worked carefully, will likely be more than the difference in returns between ~~3% on your loan and whatever you'd get in the market. 

The only time I've ever financed a vehicle, I put as much as they would allow on a card.  (If memory serves, and it may not, I think it was $7500, limited by the dealer.)  I wasn't savvy enough to open a new card and use this for my minimum spend, but I did get lots of points on my regular card.  The rest I financed via USAA at 0.9%, IIRC. (This was roughly 10 years ago.)  But I hated having a car loan and ended up just paying it un full after a few months, even though I knew it might not be the very best financial choice at those rates. 

[six-car-habit]

 ***1. It was really a super low rate (sometimes you see as low as 0% on car loans . . . but perhaps those have a catch?)***

 Generally the catch with a Zero % loan is that it is straight from the auto manufacturers lending arm - example  General Motors - GM acceptance Corp [ GMAC - which i think actually turned in to Ally ] .  Hondaa car - Honda finance Corp, etc.  Obviously Honda Finance is not going to finance your new toyota or ford @ 0%.

   The other catch being it is usually much harder to get a discount off the MSRP pricing if the buyer opts for 0% financing.  Generally a savvy buyer can get a couple thousand knocked off the price of a new car if they do a bit of research and know the base invoice and options invoice costs, dealer holdback, etc.

 I've yet to actually see a regular chartered bank or credit union actually lend on a vehicle at zero%.

[JLee]

***1. It was really a super low rate (sometimes you see as low as 0% on car loans . . . but perhaps those have a catch?)***

 Generally the catch with a Zero % loan is that it is straight from the auto manufacturers lending arm - example  General Motors - GM acceptance Corp [ GMAC - which i think actually turned in to Ally ] .  Hondaa car - Honda finance Corp, etc.  Obviously Honda Finance is not going to finance your new toyota or ford @ 0%.

   The other catch being it is usually much harder to get a discount off the MSRP pricing if the buyer opts for 0% financing.  Generally a savvy buyer can get a couple thousand knocked off the price of a new car if they do a bit of research and know the base invoice and options invoice costs, dealer holdback, etc.

 I've yet to actually see a regular chartered bank or credit union actually lend on a vehicle at zero%.

Yeah, 0% is generally subsidized financing through a manufacturer.  The best I've had was 1.99% on a used car in 2016 (PenFed).