Ford financing/rebate question
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Mountain Pass
Joined: Aug 2004
Posts: 212
Likes: 16
Ford financing/rebate question
I just signed the papers on a leftover 2019 F-450. The dealer did give me a very good price on both the new truck and my trade in. With that said, they did require me to finance the full balance minus the trade through ford financing at a rate of 7.84% in order to be able to get a little over $3000 in rebates. They said that after I make 3 payments to ford, I can refinance through my credit union. They informed me that by doing this, they make some money on the financing to compensate them for the discount on the truck. Just wondering if this is common or if I should be worried about this. I haven’t taken delivery of the truck yet because they had to do a few things to it first. Any input would be appreciated.
by the way, I do have very good credit so this rate isn’t because of that. They told me that ford tiers these loans higher because it is a commercial size vehicle and it’s a higher risk for them
by the way, I do have very good credit so this rate isn’t because of that. They told me that ford tiers these loans higher because it is a commercial size vehicle and it’s a higher risk for them
Cargo Master
Joined: Apr 2018
Posts: 2,414
Likes: 1,124
WOW
The rebate isn't tied to Ford, and that's a high rate, you think you got a good deal, doesn't sound like it on this side of the road.
You should your credit score is "good". ?
Go refinance as soon as you can. Next time, work hard to find a dealer that will soon lube when ur being bend over.
The rebate isn't tied to Ford, and that's a high rate, you think you got a good deal, doesn't sound like it on this side of the road.
You should your credit score is "good". ?
Go refinance as soon as you can. Next time, work hard to find a dealer that will soon lube when ur being bend over.
Fleet Mechanic
Joined: Jul 2019
Posts: 1,651
Likes: 696
Its common in that the dealer (any brand) will push their financing because they get a cut (kick back) from the lender, in this case Ford Credit. Ford encourages the use of their financing by offering a cash rebate. The dealer does not get their cut if the loan is paid off in less than 3 payments.
I don't think you should be worried but you do need to consider how the 3 payments at a high interest rate affects the overall deal. The dealer is essentially saying "you are compensating us for giving you a discount by paying more in interest". Maybe you come out ahead. Maybe you don't. You should ask how much interest you will pay Ford for the first 3 payments and compare to what you would pay another lender who charges a more reasonable rate. If you plan on refinancing, you should find out how the next lender will treat the loan (new car or used car rates) and how easy it will be to refinance. Some lenders make it very easy. Others, not so much. As another member posted, only $1000 of your rebates is attributable to the financing. If you choose not to finance with Ford you should still get the other rebates.
I don't think you should be worried but you do need to consider how the 3 payments at a high interest rate affects the overall deal. The dealer is essentially saying "you are compensating us for giving you a discount by paying more in interest". Maybe you come out ahead. Maybe you don't. You should ask how much interest you will pay Ford for the first 3 payments and compare to what you would pay another lender who charges a more reasonable rate. If you plan on refinancing, you should find out how the next lender will treat the loan (new car or used car rates) and how easy it will be to refinance. Some lenders make it very easy. Others, not so much. As another member posted, only $1000 of your rebates is attributable to the financing. If you choose not to finance with Ford you should still get the other rebates.
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Mountain Pass
Joined: Aug 2004
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The dealer was honest with me that I could pay it off sooner than 3 payments but they asked that I didn’t since they gave me what I think is a very good deal. If the interest is equal throughout the 60 payments, I figure it will cost me $400 in interest to save $1000 in the rebate before re-financing.
Senior User
Joined: Nov 2015
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The dealer was honest with me that I could pay it off sooner than 3 payments but they asked that I didn’t since they gave me what I think is a very good deal. If the interest is equal throughout the 60 payments, I figure it will cost me $400 in interest to save $1000 in the rebate before re-financing.
Freshman User
Joined: Jun 2019
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In May 2019, I purchased a new F250 with generous rebates and a 7+% rate and was asked by my dealer to make at least 3 payments to Ford Credit before re-fi. I read on FTE forum here that I could re-fi as soon as Ford Credit established an account #. I called FC and was given a FC acct # within 45 days of sale. I re-fi'd with USAA @ 1.9% without making a single payment to FC. My payment was lowered and the term was shortened by 12 months. There was no reaction, negative or otherwise, from selling dealer......
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Fleet Mechanic
Joined: Jul 2019
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The dealer was honest with me that I could pay it off sooner than 3 payments but they asked that I didn’t since they gave me what I think is a very good deal. If the interest is equal throughout the 60 payments, I figure it will cost me $400 in interest to save $1000 in the rebate before re-financing.
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Fleet Mechanic
Joined: Jul 2019
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Perhaps a bit more than $274. Given you are financing, you would have to pay interest on a different loan although likely at a lower rate. Figure that amount in you net savings calculation.
Hotshot
Joined: Jun 2003
Posts: 12,354
Likes: 4,389
From: SW VA
Don't wait the 3 months. As soon as the first bill comes in the mail, take it to the lender of your choice and have it refinanced. The dealer made plenty of profit of of the sale of the new truck, and they will be making plenty of profit off your trade. There is NO reason for you to get screwed out of more money just so they can make even MORE profit on the financing.
I got $500 for financing with Ford. As soon as the first bill came, I took it down to my local CU and refinanced it.
I got $500 for financing with Ford. As soon as the first bill came, I took it down to my local CU and refinanced it.
New User
Joined: Mar 2019
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Very strange. I'm in the same boat as you and bought a leftover 2019 f350 and they gave me what I believe to be a decent deal. I also used this financing incentive for the extra $1000. I told them if they could beat my bank rate that I'd give them my down payment. They ended up getting me a 3.75%. Sounds like they're trying to make up some omey back from the price of the truck?
I called my bank and asked about the requirement to keep the Ford loan for a specified time. They said to look closely in the contract as some mfg will have a specific time you need to keep the loan. I talked to my dealer about it and that requirement does not exist for ford financing.
You can refinance instantly without issues. Although AK has laws against fees for refinancing, so ymmv. Check with your bank first.
I called my bank and asked about the requirement to keep the Ford loan for a specified time. They said to look closely in the contract as some mfg will have a specific time you need to keep the loan. I talked to my dealer about it and that requirement does not exist for ford financing.
You can refinance instantly without issues. Although AK has laws against fees for refinancing, so ymmv. Check with your bank first.
Thread Starter
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Mountain Pass
Joined: Aug 2004
Posts: 212
Likes: 16
Is says right in the finance contract that there is no penalty for paying off early. They just verbally asked me to pay three payments so they get some credit from ford financing. I think the deal was good enough that I will keep my word and pay the three payments, then refinance. They gave me all the money for my trade and close to a total of $17,400 off msrp of the 2019 f450 limited.