Ally Bank is a financial institution created from the old GMAC. They are an internet based bank that has been trying to gain market-share by offering better interest rates than the competition. Now, starting October 1, 2009 they will be making a strong push to get car dealers to finance their customers through their bank.
So, based on their business principle you should assume nothing but the best rate possible from an Ally loan. This is where you need to be careful; Ally is giving big incentives to dealers. Dealers will want to put that money in their pocket. If your dealer tells you that Ally will be your lending institution ask what the rates are from other banks. Do not be surprised if their response is, “another bank has the same rate as Ally…” but you get a silly reason to do business with Ally like, “but Ally is better to work with.” That’s nonsense. At this point you should pressure the dealership to give you a better rate. Tell them you are aware of Ally Banks incentives and as the one who’s going to be making the payments, you feel you should share in their incentives. Mention that you can take your lending out of their dealership completely and that you understand that this will cost them money. Be strong here and save money.
Everyone knows it’s hard to sell cars these days. Desperate times call for desperate measures so the auto manufacturers are now trying to sell cars to college students. Yes, people who would normally not qualify for a loan because they generally do not make any money are now a target audience for desperate car dealers.
I am surprised that banks are willing to give auto loans to people who have probably never worked a full-time job. Especially during this period of excessive loan defaults, but dealers and lenders are hurting so bad for sales they have created a market that didn’t exist a couple of years ago. Now, as parents are preparing their child to go off to college they need to also protect them from desperate lends and car dealers who will be all too happy to strap a college kid with a mountain of debt. Parents remember to teach your kids that just because you can qualify for the loan doesn’t mean you need to make the purchase.
If you are shopping for a car you need to know that one of the biggest problems car dealers are facing today is the difficulty they have getting customers financed. I do not recall a time in recently memory when I’ve heard so many dealers complain about how difficult it is to get customers who are ready, willing and able to buy, bought by a bank. So as a car shopper I strongly recommend that you know your credit status and be fully prepared before you ever walk into the dealership.
Being prepared will improve every aspect for you. If prior to entering a car dealer have your credit score, financing and down payment information ready the dealer will be thrilled to work with you. From the dealer’s point of view this streamlines the process because the dealer will know you are a serious buyer that they can put in a car. With that bit of knowledge coupled with a depressed car selling environment no dealer would risk losing a real buyer who has their financing in order so you’ll get a great price. Be prepared and enjoy the benefits.
A couple of days ago I mentioned that Ford (when compared to Chevy) was offering much better programs this month. Well, Chevy has answered back. Now, on most Chevys there is factory rebates or low financing available. This makes Chevy’s programs much more competitive when compared to Ford’s programs.
And in my opinion, for truck shoppers Chevy’s program is much better than what Ford is offering. Right now Chevy is offering 0% financing for up to 60 months on the 2008 Silverado. The Silverado recently won Consumer Report’s truck of the year award and now they have a great program available on a great truck! Ford is also offering 0% financing for up to 60 months on their F-Series trucks, but the program is only available on 2007 models, not 2008s! I would suspect that Ford dealers only have a few 2007 trucks left, while Chevy dealers should have a huge selection of 2008 Silverados! So if you are shopping for a truck you might be sorry if you do not look at what Chevy’s offering this month!