THERE IS NO PENALTY!!!!
I did just what you are proposing. I bought the car in December, and paid it
off in the beginning of January. I refinanced the 6.99% loan from Hyundai
with a 4.25% loan from a credit union. The only requirement that there is is
that you finance the car. After it's financed, you can pay it off anytime.
This was verified by Hyundai finance. Call them yourself. After you buy it,
you only need to wait long enough for HMFC to send the "welcome" letter that
shows your account number. The payoff amount you get when you call is THE
payoff. There is no document that you sign where you agree to delaying
anything. It's not like they (the dealer) have any recourse anyway. The
dealer wants you to wait because they get a kickback from the interest every
month. It only cost me ~$65 in interest, and $15.00 for the re-title at the
credit union to get the $1000. Not only that, the CU was 2.75% cheaper.
Also, the credit union offered "GAP" insurance for $199, which I paid.
More info from my experiences for those that are going to buy....
DO NOT buy GAP insurance at the dealer. They'll try to get $600 for it.
Also, when you get to the F&I guy / girl, make sure that the line "total
amount finance" = what you agreed to for a price - the rebates + taxes.
Also, the "doc fee" is pretty much pure profit. Remember, you are paying for
the taxes, title, and tags on a different line. They'll say ANYTHING to get
that. They also tried a cute stunt where they included routine maint in the
total. I never asked for that, and he wasn't happy when I had him remove it.
It was something like another $50 a month. I of course got the song and
dance about voiding the warranty.
Remember that the amount above invoice + holdback is all profit. Nothing
wrong with them making a reasonable profit - maybe 3-5% above cost, which is
basically what the holdback is supposed to be. Go look it up at
http://www.carsdirect.com/home You really shouldn't pay much more than their
bottom line + tax + tags + title (Title is ~$50 here in NC) . Remember,
those items have NOTHING to do with the dealer profit device called the "doc
fee". You are paying the state for them - you have to - you are GIVING the
dealer the money for the doc. fee.
When asked if you have a trade in, don't lie. Honest answer is.... I do, but
I'm not sure whether I'm going to trade it in here, or sell it on my own. It
depends on what you are willing to offer me on it. We'll discuss that later,
after we figure out how much the car I'm buying is going to be. They don't
get the keys to your car to look it over until you've nailed down the price
on what you are buying. Make sure it's locked, and only give them a spare
set of keys. I once had a dealer in Owego, NY (A Chrysler dealer) "lose" my
keys. They had a rep. for doing that, so I was prepared. You'll know what
you are really getting for your trade, and can take it or leave it. If push
comes to shove, you can ALWAYS walk until you have signed the reg. transfer
stuff in the F&I office. Buyer's order means nothing. They are more likely
to do whatever it takes (reasonably) on the trade after you've run them
through the new car price negotiations.
My dealer told me 3 months, however, I couldn't find any such wording in
the loan agreement. My agreement did have a statement in it about a
prepayment penalty. It had two boxes that could be checked, one that
said prepayment "may" incur a penalty and the other which said that
prepayment "will not" incur a penalty. When the salesman gave me the
paperwork, most things were typed in, but neither of these boxes was
checked. So, I checked the "will not" box and signed the paper. I
figured someone at Hyundai would object, but I got my copy in the mail a
couple of weeks later with the box checked. I may pay mine off when I
get my tax refund, but that will be after 3 months anyway, but if they
try to steal my rebate I'll send my lawyer after them.
If you wait three months, assuming 7%, $20k, and 5 years, you will lose
about $360 from paying interest. I refinanced mine about 2 weeks after
I'd be interested in knowing what you guys (youz guys = Y'all down here in
the south - I'm not a native) got for an interest rate from HMFC. I got
6.99% and my score is 782. Higher than some value - unknown - is gravy for
Financing a little over 16K, we got 6.2% for 5 years. Refinanced before
the first payment was due and there was no penalty. I'd have to look up
the figures to be sure, but it seems like we "lost" about $70 by
financing through HMFC to get the rebate.
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