Pentagon Federal Ferrari Refinance Is it worth it when your current rate is so low?: =================================== Most likely YES. Read my savings %$ below. How do you get your payoff amount from Ferrari Financial?: ======================================= This was quite hard to figure out. The Ferrari web site has a paragraph on Ferrari Financial and the email address went unanswered. A quick call to the dealer that sold it to me netted an 800 number that was precisely what I needed. 10minutes total. 1. Instant payoff quote (automated) 2. Requested a letter to be sent with payoff info (automated) Ferrari Financial: 800-206-9828 Background: ============ I had recently refinanced my Lexus using my favorite local credit union [ SCCU ] and got a stellar rate of 1.89%. Their quote on refinancing my 430 was a bit less spectacular at 3.74% because they have strict underwriting rules regarding the age of the vehicle. The cutoff for the good rates is 2007. Apparently my car is now "old". I was reading some FChat thread, likely just trying to once again avoid my daily responsibilities, and came across some chap who had refinanced or financed using Pentagon Federal. The rates quoted were too good to be true, so I went to PenFed.com and read through their literature. They had rates for a used car refinance at 1.49%. Don't you have to be Government or Military to be a PenFed member?: ==================================== Yes and No. It seems you can qualify if you are a member of several charities. They clearly pitch this "work around" on their site. During the Join PenFed page, if you select "None of the above" to their myriad of Govt and military options, this pops up. (see images). Basically you can join one of two foundations for a one time fee of $15 or $20 depending on which foundation makes you the most happy. I chose the $20 one. Basically you are donating $20 to be a member. I suppose they assume anyone nice enough to donate money to a military charity or association is good-people. Polarizing Politics: ============== ARGUMENT_A: "If you don't write a check for a Ferrari you should not buy a Ferrari". This gets people all fired up, especially people who have chosen to forgo investing $150k+ and instead park the cash in a depreciating liability. I have recently stumbled upon this argument on a BMW motorcycle forum, nearly verbatim. -1. I make 8% to 20% on my investments. 8 being the worst (past results do not guarantee future success). -2. I have a loan for 1.49%, and have the money invested fairly aggressively. The net yield (post taxes) is an order of magnitude more than my finance APR. -3. If I need cash fast, I can liquidate my investment without [fire] selling the car or doing any other fancy financial gymnastics. -4. For third party prying eyes my financial picture "seems" better showing the large semi-liquid investment as opposed to a vehicle asset line item, which is not very useful for many financial situations. Yes I know its a balance asset Vs liability, at least day 1. Day 2 and beyond the investment starts yielding fruit. -5. Inflation is > my finance rate, thus the lender has agreed to get paid back a net amount of real dollars that is less than financed + interest. -6. I recently paid cash for my BMW bike because I did not feel like filling out the paperwork for "just" $20k, and I have been buying vehicles in cash since I was born and financing takes some getting used to really. Not a good financial decision on my part. $1k or $1M, it should be invested. ...I partake in financial moves that would make most people poop themselves. Financing instead of paying cash is about as benign as they come. DIY Refinance Overview: =================== I will outline my two refinance experiences for contrast: -1. SCCU (Space Coast Credit Union): *non profit ======== --Vehicle: Lexus IS (great car; young women have actually gone on and on about how once and sporty it is) --Current APR: 3.9% (good rate when I bought it) --SCCU Rate: 1.89% (PenFed was cheaper, but Hassle Vs $_Savings SCCU won) >Overview: I called them on monday, they asked about 20 minutes of questions, and we had a deal. I was to meet a human at my local branch the following day at a time of my choosing for a closing. The closing took 7 minutes. Bing-bang-done. >>>>>> >Savings: Finance $ went from 16% of my vehicle price to 2.85%!!! I will call this FREE >Total Time: 45 minutes including driving >Hassle Level: 1 (1-10, with 10 being natural child birth) -2. PenFed (Pentagon Federal): *non profit ======== --Vehicle: 2006 Ferrari F430 Spider (Fantastic car) --Current APR: 4.9% (not a great rate, but I was in a jam because SCCU had fallen through because of underwriting issues on Saturday and you know I had to drive the car home that day, heck i was 4 hours from home with no car!) --PenFed Rate: 1.49% (SCCU wanted 3.74% because it was older than 2007) >Overview: I tried to use the online form, but it would not accept my VIN. It also did not have Ferrari in the drop down Make list. The rate clearly says you have to file for the loan online to get the 1.49 rate, but because I started it online the rate stuck. I had to call them and get a human. Fast and painless. But it was still problematic, they were having VIN issues, finally root caused to the Ferrari marquee. Another issue was the fact they only loan up to $70k, a far cry from a 06 F430 Spider, so I was going to write a check to pay off the delta. This is not "normal" so it did not fit their system. --Call_1: Yes the online system is not taking my VIN. No problem give us the details: 20min --Fax last few paystubs --Call_2: ..a week later "We also need your last years 1099 --Fax 1099 --Call_3: 1 week later "The underwriters have approved your loan, and will be sending a check.". I thought, wow that was easy, not SCCU easy, but hey its 1.49%. --Call_4: 2 more weeks later I told them I did not have the check and they said "You have to call and request it" WTF? I said "oh, ok, I REQUEST IT" They said no problem and my check was in hand in 3 days with no expedited shipping charges. With the check was a myriad of paperwork I was left to sort myself: -A. Letter to Geico asking them to send PenFed proof of Insurance. Normal stuff apart from the requirement to have a $500 deductible. I called Geico and had it lowered from $1k to 500 and it raised my premium quite a bit. Who cares about $500 when you have Ferrari class repairs. But I said of well later I had to call to clarify some information on their poor instructions and I asked about the requirement of a 500 deductible. Long story short (too late), they waved the requirement. So I re-raised my deductible back to $1000. I hate to give up any of the savings by increasing my cost to insure. -B. Payoff letter for Ferrari Financial: Filled it out and put an "extra" personal check in to make the total checks 100% of the payoff I had received that day by calling ferrari financial. Insert two checks (1. PenFed. 2. Trents Personal Check) -C. Mail documents back to PenFed signed and dated >>>>>> >Savings: Finance $ went from 15.9% of my vehicle price to 2.45%!!! About what I spent in my last Ferrari Store order of a few watches and some swag for the boys. >Total Time: 2 hours of me-time and one Month elapsed >Hassle Level: 6 (1-10, with 10 being nipple piercing without local anesthesia) If this encourages anyone else to refinance to save $, please post your success story to provide me an affirmation on this hour of my life lost typing. Image Unavailable, Please Login Image Unavailable, Please Login
Thanks Trent! I always wondered how you qualified. That stopped my previous research into penfed but now that I know this will be definitely an option to entertain in the future.
when I bought my 360 in April I called PenFed and qualified right on the phone for 100% financing on the 360 ( I only needed about half), it took less than 10 minutes total time and that included me joining by paying some charity $10, I had the check 2 days later, super easy. Not so easy a few days ago when I went to pay it off, got the amount but they sure pushed (very politely and very nicely) to have me not pay it off. Sorry, I HATE DEBT and could not stand having a car payment. Some people say I can make more % points in investments, etc. so it makes sense to finance and I admit I could not afford my 360. I had to finance a little less than half or not have the car. But in the end I hate debt and I sleep good at night knowing "you want fries with that?" will pay all my monthly bills if needed, so I struggled and paid it off. I would probably not even shop around for another financial institution if I financed another car, that is how good PenFed made the whole experience.
I love Pen Fed. Just used them to finance my new DD. Their rates are amazing! Using the referral from their car buying service, which just pointed me to my three local Fiat dealers anyway, drops the rate down to .49%! They were super easy to deal with and VERY helpful!
Had CapitalOne back in the day with my Boxster. HORRIBLE Interest rate... never again.. love Love LOVE PenFed. I do everything online with them with my car and yes, you do have to call when you're buying an FCar. (Heart) them.
Trent, Thanks for taking the time to post your detailed experience and screen shots. It was a worthy read. It seems, overall, that PenFed is pretty painless, regardless of the details of the transaction. What I mean to say is that most folks say they're good or great. I haven't read anyone saying that they suck. Thanks again - when I go to buy my first F-car, I will certainly be knocking on PenFed's(metaphorical) door.
My experience was almost identical. I couldn't believe how quickly and easily they sent money to me for loan which was backed by a car. FWIW, I have a lot of equity in my home and decided to recently take them up on their 1.99% home equity loan product. I borrowed $50k for 5 years at a fixed rate of 1.99% Took much longer than the car loan and I had to pay for an appraisal ($300) but other than that it was a good experience. part of the reason it took longer -- so they claim -- was the popularity of the product overwhelmed them and they were short-staffed for a while. They are also now offering 30-year fixed mortgages at like 3.25% or something. Absolutely crazy. I locked in a 15-year fixed first mortgage on my house last year (purchase, not refi) at 3.00% and I thought I was pretty hot sh*t. Now 30-year rates are available which rival that. Unbelievable.
PenFed here too. They did the financing on my Aston Martin, per the great recommendation of the folks at Sport Auto in Summerfield, NC. A+
Correction: if you cannot AFFORD to write a check for your Ferrari then you should not buy one. Now whether you do or not is another matter entirely.
From this thread , there are many who finance. So what how cares. This makes me want to re finance something with them
Correction: if an opinion wasn't asked for it should not be shared. Now whether you do or not or what that is, is not cared.
+1. My Aston is at 1.99% from PenFed. I can earn more than the 1.99% elsewhere, so why would I tie up cash in a car instead of having it work for me in the various equity markets?
The discussion is taking a turn, it's all about the investor's risk tolerance. Personally, I will consider PenFed, even though I can pay in cash. I just have a different balance than some folks. But that's just me. Again, to the OP, thanks for sharing your positive experience.
I looked at them for a potential house refi, the rates were appealing (closing cost somewhat high). I looked at some of the reviews and the majority were atrocious so it's good to hear positive reviews.
For house refinance they are understaffed and processors are pretty green....takes a long time to get the refi done- In my experience. Rates are good, but fees a little more than others, So shop around. For car loans, especially for older cars, Ferrari, Vipers, etc. they are unbeatable for 5 year terms.
The last time I checked PenFed, their longest loan term was 60 months. I wanted low monthly payments so was looking for 72 months. Currently Alliant CU offers 1.99% for 72 months so that works for me.
Except it is on cars 2011 and above only ....great 72 month rate, if newer car. They also offer 2.99% on 84 month new car, great rate if that is the term that you are looking for. I have yet to find some other CU that finances NADA value ( up to $70K) on a 97 Viper and a Ferrari for 1.49%.....Most "cheap" banks/CU just do not finance older than 6-7 year old cars, I am sure some others do- just have not heard of them. Pen Fed will go 72 months on an older exotic, but that rate jumps to 3.49% if I recall correctly.
Thanks a lot for posting. My wife needs a new car, after her X5 has broken for the fourth time, and I will look into this myself. By the way, I thought I was being a responsible citizen by paying cash for 5 cars, including three collectible ones. However, I went to talk to my banker about some funding for some small time real estate development, and he basically placed no value on these when looking at my personal balance sheet. He just views me as a dummy for paying cash for depreciating assets. I could argue with him all day long that these 3 cars are in fact collectibles and have held ther value quite well in the years I have owned them, but he just doesn't see it that way. Bottom line, I should have financed all of them through Penfed and held the cash on my balance sheet or used the cash to put toward my real estate development. If you can borrow money at 1.5%, do it.
You're a troll. And I'll continue to express my opinion about this (and other things) whether you like it or not.
BTW- You can sell an existing paid off title to PF ....to finance other endeavors- like more rentals...
