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Actually, to clarify you can write off the expense (interest) to borrow the money against the taxable investment income (be that interest, dividends or capital gains).
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On a secured line of credit you SHOULD be able to get Prime + .5 to Prime + 1. A little push should get you the lower percentage if you have a good history. TD initially offered me Prime + 1, but reduced it to Prime +.5 (=3.5%) when I indicated the former wasn't enough of a spread to warrant giving up the buy back option from Tesla through their lender.
Quite correct, it's deductible against the investment income. But even a conservative investment strategy should be able to produce better than prime +1%.
The important thing is to keep everything segregated: The money borrowed comes from a separate, secured credit line, and the money invested goes into a separate investment account, so that there is no muddying of the waters for CRA to get upset about.
The important thing is to keep everything segregated: The money borrowed comes from a separate, secured credit line, and the money invested goes into a separate investment account, so that there is no muddying of the waters for CRA to get upset about.
Mayhemm
Model S P85+ "Lola"
How did the financing process go for those who financed through Tesla/Scotiabank? I was told by my various DS's that it would be dealt with a couple weeks before delivery. Well, my car finished production today and is scheduled to be delivered in 10 days. I asked my current DS about the financing and he acted all surprised that I hadn't done it already and even implied that sorting it out may delay my delivery! Nearly everything else about the order process has been excellent (though Tesla not accepting trade-ins for SK customers was annoying) but I'm not impressed with how they handled this.
bsd
Member
I ordered in-store on June 16 and filled in the ScotiaBank financing at the same time. I received confirmation of financing from ScotiaBank (via Tesla) on June 21, and the order confirmed on June 26. Signed the financing documents around when I picked up the car in Sep.
Mayhemm
Model S P85+ "Lola"
Where did you turn in your application? The bank? The Tesla store? Or did you fax it somewhere?
How was your monthly payment determined? Did you make a downpayment on the car?
iKhalid
Member
Tesla's financing in Canada is really bad! really really bad! They are handling these transactions from California. It should be handled at the store in my opinion and they should have the same software other dealers have to be able to submit an application with all the Canadian banks.
When I filled up the form for Scotia through Tesla, the guy from California insisted that I should put my SIN and I refused! He thinks SINs are mandatory the way SSN is in the US. This has resulted in a week of delay, and then when it was forced to be processed as is (without SIN), I was told that my profile was incomplete! And when I asked why to be able to provide what is missing (they cannot legally force you to provide your SIN), I waited for an answer but I never got one!
I went to my bank "CIBC" and the transaction went through on the spot. I didn't like the APR because it is way cheaper if it was done through a dealer instead of me going directly to the bank... Anyways, the buying experience in Canada cannot be compared to what we read and hear from the people from the US.
When I filled up the form for Scotia through Tesla, the guy from California insisted that I should put my SIN and I refused! He thinks SINs are mandatory the way SSN is in the US. This has resulted in a week of delay, and then when it was forced to be processed as is (without SIN), I was told that my profile was incomplete! And when I asked why to be able to provide what is missing (they cannot legally force you to provide your SIN), I waited for an answer but I never got one!
I went to my bank "CIBC" and the transaction went through on the spot. I didn't like the APR because it is way cheaper if it was done through a dealer instead of me going directly to the bank... Anyways, the buying experience in Canada cannot be compared to what we read and hear from the people from the US.
I looked into the costs of financing before we purchased and felt at that time the % rate was too expensive compared to other credit. I wanted to keep SOME of my TSLA stock and felt that the likely stock gains would be more profitable than the interest I would be paying. Not how I normally think... but then, this isn't a normal car or a normal car company. But even so, overall I give the Canadian Tesla financing a thumbs down, there are cheaper options from other sources.
I am so with you on nobody, but nobody, gets my SIN (well, except CRA and the pension guys, but then, no choice there). It's amazing how many retailers ask for it. Many staff/clerks don't have a clue why you wouldn't give it to them.
AC1K
Member
like some others here, i did a secured line of credit against my house, its prime + 0.4%
however, unlike a mortgage there is no penalty for paying it off sooner (just like a car loan), and also no maximum time period as long as you cover the interest.
however, unlike a mortgage there is no penalty for paying it off sooner (just like a car loan), and also no maximum time period as long as you cover the interest.
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iKhalid
Member
Isn't prime + 4% is high? Here in Ontario, you could get it for prime + 0.5% with RBC and some other banks.
AC1K
Member
oops yes thats what i meant prime +0.4% (so its 3.4% currently for my interest rate)
Mayhemm
Model S P85+ "Lola"
One thing I wish was made more clear with Tesla's financing is that Scotiabank will only finance >60% of the car's value; meaning your down payment cannot be more than 40% of the car's value. I had a specific term/monthly payment in mind and had decided that I would just make whatever down payment was necessary to achieve this amount. Turns out my down payment would have been >40% (closer to 60%) so I had to completely rethink my terms. I ended up paying a bit less than I wanted per month and taking an extra year of financing, which resulted in a few thousand extra dollars in interest I hadn't planned on.
Tesla plainly lists some very specific conditions regarding their financing option (has to be between 36 and 66-months with at least 15% down) but makes no mention of the minimum finance amount. Of course, this could be a standard condition of any Scotiabank loan and not something Tesla has control over. Still, they should at least provide a link to the corresponding Scotiabank page listing the conditions of their loans.
Tesla plainly lists some very specific conditions regarding their financing option (has to be between 36 and 66-months with at least 15% down) but makes no mention of the minimum finance amount. Of course, this could be a standard condition of any Scotiabank loan and not something Tesla has control over. Still, they should at least provide a link to the corresponding Scotiabank page listing the conditions of their loans.
iKhalid
Member
Tesla could have the software all dealers have (even used cars dealers) and offer financing options with all the banks and let the customers decide. But why would they bother, their cars are sold before they are actually made.
I honestly don't see anything special about Scotia Bank. If you find barely used Tesla with a used cars dealer, you might be able to get a good deal since dealers are able to offer better interest rates.
I honestly don't see anything special about Scotia Bank. If you find barely used Tesla with a used cars dealer, you might be able to get a good deal since dealers are able to offer better interest rates.
Any car loan I've ever had has allowed for additional payments including paying it iff early. Can you simply put some thousands on it now to get it where you want it, so you won't have to pay the extra interest?
not true. Scotia funded 100% of my car's value. I could have put cash, but my investments ROI is higher than Scotia's rate. So I'll just keep paying monthly until my 7 years are up. Tesla negotiated on my behalf. You just have to show them your annual income can afford this awesome vehicle.
Mayhemm
Model S P85+ "Lola"
I can make any additional payments I want without penalty. However, the interest is already rolled into the monthly payment amount so I wouldn't be saving anything by paying it off early.
I think you misunderstood my statement. Scotiabank will not finance less than 60% of the car's value. 100% > 60%, so you are within their conditions.
my bad!Similar threads
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