Current Interest Ford Interest Rates?

[area5179]

You haven't been paying to federal rates or auto rates for at least a year if you really feel this way.
6% is probably the lowest publicly available interest rate. By a bank or credit union. Incentivized rates only recently came out. For those of us who bought last year, 6.9% is/was pretty much the norm.

The fed interest rate is between 5.25% and 5.5%. That means anyone offering rates below that are losing on money compared to bonds with the feds.

This is true. My credit union is only .15% less than Ford's current rate for the same loan terms. It's a far cry from when I bought my first mustang in 2005 and financed with my credit union for HALF of what I was offered at the dealership, even for a first time buyer.

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[roadpilot]

The fed interest rate is between 5.25% and 5.5%. That means anyone offering rates below that are losing on money compared to bonds with the feds.

Only if that lender has to borrow money in order to fund your loan. If the have enough cash reserves to fund your loan, then they aren't losing money on your loan beause they don't have to borrow money to fund it -- but they know they can get away with raising the rate to make more on it.

 

[roadpilot]

This is true. My credit union is only .15% less than Ford's current rate for the same loan terms. It's a far cry from when I bought my first mustang in 2005 and financed with my credit union for HALF of what I was offered at the dealership, even for a first time buyer.

Like I said just a few posts above, when I bought my F150 back in 2021, I got 1.89% for 72 months. That's almost like borrowing money for free. I will not be trading that truck in any time soon, likely keeping it another ~3 years and paying it off.

 

[Interstellar]

Only if that lender has to borrow money in order to fund your loan. If the have enough cash reserves to fund your loan, then they aren't losing money on your loan beause they don't have to borrow money to fund it -- but they know they can get away with raising the rate to make more on it.

You're not borrowing money from the feds, you're giving them money for a guaranteed 5.25-5.5%.
The opportunity cost is certainly not in their favor when giving out loans at 3.9% with the additional risk of people not paying, crashing the car, etc.

 

[roadpilot]

You're not borrowing money from the feds, you're giving them money for a guaranteed 5.25-5.5%.
The opportunity cost is certainly not in their favor when giving out loans at 3.9% with the additional risk of people not paying, crashing the car, etc.

We're not talking about lost opportunity cost. We're talking about a lender lending you money to buy a car and where they got that money from (borrowed it from another bank or had cash reserves).

 

[Interstellar]

We're not talking about a lender investing money instead of loaning it out. We're talking about a lender lending you money to buy a car.

So this is why you won't see any rates below 5.5%

 

[roadpilot]

So this is why you won't see any rates below 5.5%

Wrong.

Ford Credit is offering a bunch of financing at anywhere from 0% for 72 months (IIRC, I saw several models offering this in the past few days of browsing Ford dealer sites) and up. Here's the current program for the 24 Mustang:

Program #20068 - Effective 1/3/24 through 4/2/24 on select vehicles, including select Mustangs
1.9% for 36 months
2.9% for 48 months
3.9% for 60 months
5.9% for 72 months

 

[Interstellar]

We're not talking about lost opportunity cost. We're talking about a lender lending you money to buy a car and where they got that money from (borrowed it from another bank or had cash reserves).

Wrong.

Ford Credit is offering a bunch of financing at anywhere from 0% for 72 months (F150s) and up. Here's the current program for the 24 Mustang:

Program #20068 - Effective 1/3/24 through 4/2/24 on select vehicles, including select Mustangs
1.9% for 36 months
2.9% for 48 months
3.9% for 60 months
5.9% for 72 months

Alright I'm done trying to explain it. You even said "Lenders" in your first post.
Incentivized rates are completely different.......from the views of Ford they can either give cash incentives or incentivized rates or a combo of the 2 to move inventory. Again though, they are LOSING money compared to buying treasury bonds though

 

[roadpilot]

Alright I'm done trying to explain it. You even said "Lenders" in your first post.

Ford Credit is a lender.

I don't need you to explain anything. Again, I'm NOT referring to lost opportunity cost.

 

[LOTO1953]

You haven't been paying attention to federal rates or auto rates for at least a year if you really feel this way.
6% is probably the lowest publicly available interest rate. By a bank or credit union. Incentivized rates only recently came out. For those of us who bought last year, 6.9% is/was pretty much the norm.

The fed interest rate is between 5.25% and 5.5%. That means anyone offering rates below that are losing on money compared to bonds with the feds.

Been paying very close attention to rates almost daily for the last 25 years so I will rephrase...she said 6.9 for a credit score of 800 and I knew she was lying OR the customer was a fool for using her lender.

 

[Interstellar]

Been paying very close attention to rates almost daily for the last 25 years so I will rephrase...she said 6.9 for a credit score of 800 and I knew she was lying OR the customer was a fool for using her lender.

what bank do you use. Willing to bet their rate is the same if not worse

 

[LOTO1953]

what bank do you use. Willing to bet their rate is the same if not worse

Lets put some money on this then….say $1,000.00 I can beat 6.9?

 

[horned-toad]

Not at all. Rates are astronomical across all credit risk tiers.

I'm talking strictly Ford Credit.
Tiers 1-3 all are the same. That dealer in particular was feeding a 800+ person line #4 if not #5 where the rates DO go way, way up.
Hence my comment about neededing a 600 to get raped by FC that hard. I was't accounting for a shyster dealer screwing over the purchaser, however.

 

[horned-toad]

Again though, they are LOSING money compared to buying treasury bonds though

of course. but they don't care about maximizing Bank of Ford's returns, they MUST MOVE all teir gd inventory because otherwise they have to shut down plants and reneg on supplier contracts etc.

This stuff is financed by investors - who for inexplicable reason would rather get returns from Bank of Ford Credit, than park their funds with the Fed discount window.

Your town bank is far less likely to loan at sub-Fed rates, they want to make money, not lose it, and have no reason to incentivize because they have no captive inventory they are forced to jettison.

My used car loan in Dec 22 was 5.24%, y used car loan in Jan '24 was written at 6.6

 

[horned-toad]

Lets put some money on this then….say $1,000.00 I can beat 6.9?

not fair. Your Bank/CU of Sam Walton's Kids, has massive cash-flow to play with lending to it's local community.

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