This is true, at least for my brother who just bought one yesterday. He had to just pay the taxes (roughly $3800). Financed the rest.
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.99% APR Financing Promotion (May 10 - May 31 2024)
- Thread starter Zer0Her0
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This is true, at least for my brother who just bought one yesterday. He had to just pay the taxes (roughly $3800). Financed the rest.
Stretch2727
Engineer and Car Nut
Curious if this was financed by Tesla directly or did they direct you to a partner bank?
ucmndd
Well-Known Member
So I'm trying to do the math on this and figure out how much of a present-day discount this is given a safe equivalent investment into US treasuries. I was thinking of buying a 2-3 year old SUV but it looks like the Model Y is a pretty good deal? (Excluding fees, taxes, etc.)
On the base RWD there's a MSRP of $45,000. With the EV incentive in California, this brings it down to $37.5k. If you took the 72 month financing option with 0 down, and invested $37.5k into US treasuries, you'd be getting a 4.5% return, which is a profit of $10,125.00 (after 6 years, simple interest). Over that same time period, you'd be paying 1% APR on a 37.5k loan, which comes to $1151 in interest (after 6 years). So after 6 years, a difference of $8974. Adjusting for inflation, that has a present value of $7184.
So then, $45,000 - $7500 - $7184 means that the cost to purchase this vehicle is $30,316. Does that make sense? I know you can't technically buy 6 year treasuries but 5 year is close enough.
On the base RWD there's a MSRP of $45,000. With the EV incentive in California, this brings it down to $37.5k. If you took the 72 month financing option with 0 down, and invested $37.5k into US treasuries, you'd be getting a 4.5% return, which is a profit of $10,125.00 (after 6 years, simple interest). Over that same time period, you'd be paying 1% APR on a 37.5k loan, which comes to $1151 in interest (after 6 years). So after 6 years, a difference of $8974. Adjusting for inflation, that has a present value of $7184.
So then, $45,000 - $7500 - $7184 means that the cost to purchase this vehicle is $30,316. Does that make sense? I know you can't technically buy 6 year treasuries but 5 year is close enough.
Simple answer is no. You are missing the most important part is that you would have to pay monthly payment, which will eat into your interest. See my post below for true savings.
.99% APR Financing Promotion (May 10 - May 31 2024)
THANKS! Yes - I forgot about those freezes. FIXED. Now, I can't find the entry channel for prequalification.
teslamotorsclub.com
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Simple answer is no. You are missing the most important part is that you would have to pay monthly payment, which will eat into your interest. See my post below for true savings.
.99% APR Financing Promotion (May 10 - May 31 2024)
THANKS! Yes - I forgot about those freezes. FIXED. Now, I can't find the entry channel for prequalification.
Calculate your own numbers here.
Auto Loan Calculator
Free auto loan calculator to determine the monthly payment and total cost of an auto loan, while accounting for sales tax, fees, trade-in value, and more.
Ahh you're completely right. Not sure how I missed your post, thanks!
Still, seems like $33,000 for a new model y is pretty good, no?
To be honest this is very close to inventory discounts they had in March. About $4k to $5k for most cars.
The only issue with this deal is you are locked in for 72 months to realize full savings. If you upgrade to newer car before that you won't realize full savings.
Bottom line this is a good deal for those who will finance fully. Not so good for full or partial cash buyers.
I just ordered mine this past Sunday, and here in California you can finance the taxes in, so the only additional down payment i made was the equity of the trade from my 2020 Model Y.
Matters more what model and what color ; could also depend on where you live.
The app should give you a date range when you first go to build the car you want ; of course also check Inventory as there may be exactly what you want already at or on it's way to dealer that is new
When I tried out a few configs I got either May-June or June depending on what I mentioned but also most colors and configs are also currently made and available so would be definitely May on any of those.
If you are applying the $7500 federal rebate to your order than you don't have to pay a down payment or pay the taxes you could finance it all ; the taxes/your total at signing is deducted from the 7500 and the remaining becomes your actual down payment as far as the bank is concerned.
If you don't qualify for the federal rebate of $7500 that is different, as the bank considers this cash up front than you would probably need to pay the taxes plus something as a down payment.
Is there a certain specific way to go abo
Is there a specific way to go about it so that the bank will deduct the 7500? Like do I have to provide the bank with something? Or just ask?
It does that automatically on their website finance application after you fill out the Incentives section (after your order is officially placed you will be asked to fill out these forms via the Tesla app)
if you qualify for the federal rebate and agree to apply it at point of sale by Telsa on the Incentives form
Your finance form will have the $7500 listed and included / treated like a desposit ; will still have another deposit area which is like an optional additional deposit you may want to make ; change that deposit to Zero on the finance form and should be all set.
My personal experience: My state also has a $3500 rebate so in my case it counted $11,000 technically as my amount down to cover the taxes, etc... plus a down payment. I put zero as my down payment amount but the system automatically takes the 11K ; I have zero due at signing.
A bigger question would be if you wanted to get a State rebate back in cash instead of applied to the loan/purchase. There is no way to do that online so would require human intervention.
Human invention may be my next step as I also have a trade in that I may add to my order before delivery ; and likewise it will automatically apply that trade in equity as a down payment amount if I use the online system only. I entered my order with no trade to avoid this temporarily.
I don't want to put the above $11K plus my trade in equity down ; whole point of .99 financing is to take advantage of the low interest rate.
So I need them to some how cut me a check at closing ???
if you qualify for the federal rebate and agree to apply it at point of sale by Telsa on the Incentives form
Your finance form will have the $7500 listed and included / treated like a desposit ; will still have another deposit area which is like an optional additional deposit you may want to make ; change that deposit to Zero on the finance form and should be all set.
My personal experience: My state also has a $3500 rebate so in my case it counted $11,000 technically as my amount down to cover the taxes, etc... plus a down payment. I put zero as my down payment amount but the system automatically takes the 11K ; I have zero due at signing.
A bigger question would be if you wanted to get a State rebate back in cash instead of applied to the loan/purchase. There is no way to do that online so would require human intervention.
Human invention may be my next step as I also have a trade in that I may add to my order before delivery ; and likewise it will automatically apply that trade in equity as a down payment amount if I use the online system only. I entered my order with no trade to avoid this temporarily.
I don't want to put the above $11K plus my trade in equity down ; whole point of .99 financing is to take advantage of the low interest rate.
So I need them to some how cut me a check at closing ???
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Everything I described above may sound a little complicated but the 3 forms they ask you to fill out take about 15 minutes in total
Registration form (who will own the car) / Incentive Form (how to handle the rebate) / Finance Form which is really a Loan App
I got a text / link to complete these approx. 24 hours after I submitted my order online
Loan was approved in about 15 minutes. I had done previously on the Telsa website the pre-approval which was approved in seconds. Similarly on that tool you can change the deposit amount to zero.
Registration form (who will own the car) / Incentive Form (how to handle the rebate) / Finance Form which is really a Loan App
I got a text / link to complete these approx. 24 hours after I submitted my order online
Loan was approved in about 15 minutes. I had done previously on the Telsa website the pre-approval which was approved in seconds. Similarly on that tool you can change the deposit amount to zero.
Yes i believe you are correct. I thought he had to pay the taxes but after talking to him it sounds like he didn’t have to.
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