Tesla Loan Interest rate now at 3.5% ??

[NY_Rob]

I could have sworn the loan rate from Tesla was at 4.5% just last week?
Today it's down to 3.5% which is competitive with my credit union offering 3.09% for new automobiles.

Tesla $20K loan at 3.5% = $364/month
Credit union at 3.09% = $360/month

Probably easier to just go w/Tesla at this point if you're planning a quick payback.

 

[Gizmotoy]

Everybody's rates should drop because the fed just cut its benchmark rate by 0.5% yesterday.

 

[emYgrunt]

I was seeing 3.5% through Tesla last week.

Check Bank of America, they were 3.5% last week and now it’s 2.5%

 

[Slumpey326]

Are you just searching, I assume you cant request a loan yet without actually get a vin # for the model y order. Or maybe I am wrong here? Someone please clarify if they know more.

 

[NY_Rob]

To get the actual Automobile Loan $$$ from a bank/Credit Union you need the VIN, but they all advertise their rates.
You can be pre-approved without a VIN, but again yo don't get the $$$ till you have a VIN.

 

[Slumpey326]

Is pre approval typically good for 30 days or can you not lock in the rate till you have a vin

 

[jmatero]

I ordered on Feb 8th and it was 3.5 then.

 

[AdVanced]

I got approved Monday of this week at 3.54% with check in hand for my bank. Should I go back to see if it's lower or is that not a thing/worth it? I'm fine with the rate I got. Seems like they had certain rate ranges that were static for 6 month periods.

 

[Slumpey326]

Do you have vin yet? Do you have actually delivery date? You are basically paying interest now without a car in hand. I always wait to get check from bank/credit union right before I pick up cAr.

 

[AdVanced]

Do you have vin yet? Do you have actually delivery date

I don't, I'm sure the sub will explode when they start doing so haha. I have everything ready to throw my money at them.

 

[diegoC]

I too applied for and got pre-approved for a new auto 60 month loan at BofA (valid for 30 days) in preparation for the upcoming delivery of my performance Model Y csuv this month. At that time the advertised rate was 2.69%, which is still what it offers as of today. Also, if you are a BofA premium rewards member, you could get up to 0.5% discount from the advertised auto loan rate offered by BofA, which brought my rate down to 2.19% for a 60 month loan.

And just like what NY_Rob said above, you dont get the $$$ until you give the bank loaning you the money a copy of the Tesla “motor vehicle purchase agreement” (MVPA) which specifies the vin of the MY you are buying. And in contrast to what sherer326 had stated above, certain banks can still provide you a check and you wont get charged interest until the check is accepted and cashed/deposited by the dealer, in this case is Tesla. You can also be charged interest by the bank only if you deposited the check and the money was funded and stored in your bank account.

 

[Slumpey326]

My bad, thanks for clarifying for some instances. I know others once the check is mail out they start charging interest because the loan is active.

 

[rogerkamp8817]

If my loan is approved thru Tesla (@ 3.5%) and I'm at the "drafting contract, wait for them to contact with vin" stage, can I intercept with another bank's loan (i.e., B of A @ 2.6%?) without messing up my order?

 

[NY_Rob]

^ on a $20k loan the difference between a 3.5% rate and 2.6% rate is $9/month.
On a $40k loan the difference between a 3.5% rate and 2.6% rate is $16/month.


Simple Loan Calculator - Credit Karma

 

[emYgrunt]

^ on a $20k loan the difference between a 3.5% rate and 2.6% rate is $9/month.
On a $40k loan the difference between a 3.5% rate and 2.6% rate is $16/month.


Simple Loan Calculator - Credit Karma

That’s $960 over the life of the loan. Dealerships want you to think in terms of monthly payment. Or “that’s only a cup of coffee per day difference”.

I imagine a lot of people will be doing a loan close to 50k which is $1200 savings over 5 years.

And some auto loans are precomputed interest so even if you pay off early, you don’t avoid the full interest cost.

 

[NY_Rob]

^ yes, but many would pay off way faster than 5yrs, or trade-in/up before then.

Personally I try to never finance a car for more than 12 months. If I can't swing that, I wait till I have the funds to reach that goal before purchasing.

"And some auto loans are precomputed interest so even if you pay off early, you don’t avoid the full interest cost."
Never heard of that, but I'm not surprised they exist. New/young homeowners are always shocked/saddened when they see a amortization schedule for the first time. Many tricks exist in the loan industry designed to separate the borrowers from their money.

 

[emYgrunt]

Personally I try to never finance a car for more than 12 months. If I can't swing that, I wait till I have the funds to reach that goal before purchasing.

I applaud that and its a good discipline if you hate debt like the plague. For some savvy users, taking a loan at 2.5% and financing the majority of it is preferred because even a modest index funds will out perform that if you invest it.

Dave Ramsey says pay cash. “Debt is evil”

Robert Kiyosaki says finance with low interest loans so you can make your money work smarter by investing. “Make debt work in your favor”

 

[AdVanced]

I applaud that and its a good discipline if you hate debt like the plague. For some savvy users, taking a loan at 2.5% and financing the majority of it is preferred because even a modest index funds will out perform that if you invest it.

Dave Ramsey says pay cash. “Debt is evil”

Robert Kiyosaki says finance with low interest loans so you can make your money work smarter by investing. “Make debt work in your favor”

That is why I decided to finance. I'd prefer to let my money work for me and take the risk of investing the difference. Granted, everyone has different walks of life and holding debt can get in the way of other life needs. On the other hand, having liquidity if great in the event of emergency. Lots of pros and cons to each.

 

[rogerkamp8817]

Tesla finance responded and answered my question, which is, yes, even though my loan thru Tesla (WF) is approved, I can still use another bank I bring in at this stage without messing up my order.

I agree, the $ / mo seems small but over the life of the loan, the 3.5% vs 2.7% can add up to >$1k in interest, which makes it worthwhile for me to go with the 2.7% loan.

 

[NY_Rob]

^ congrats!

Do you have an actual delivery date?