McLaren Life banner

1 - 20 of 32 Posts

·
Registered
Joined
·
24 Posts
Discussion Starter · #1 ·
Hey everyone!

Around a year ago I made a thread titled "Covid 19 and 720s pricing". Based on the uncertainty of the market and unprecedented scenario unfolding at the time, I thought it best to hold off any purchase.

Well suffice to say, the market definitely took a turn....and not in the way many of us were expecting, especially for the used market. That being said, I am tired of trying to time the market and am relatively hard set on finalizing a purchase of a CPO 18 or 19 720s. The thing is, the rates I am getting quoted from Pfaff Financing (the automotive group who owns all the McLaren dealerships in Canada) are absolutely absurd. Financing rates across all terms whether it be a 12 month or a 72 month term are 6.00%....which is insane. I am able to pay cash for the vehicle, however would much rather retain that capital on tap in the event I would like to invest in a few potential ventures.

So....am I out for lunch here? Or is 6.00% a new reality for upcoming McLaren owners? Credit is excellent and history is thoroughly comprehensive. Does anyone have any insights or suggestions?

Thank you once again for all of your responses!

Khan
 

·
Registered
Joined
·
59 Posts
My credit union is at 2.65% for 84 months, but I'm here in the US. I'm not sure what McLaren is quoting for their own financing.
 

·
Registered
Joined
·
556 Posts
Just bring your own financing. Bank rates in US are 2.39%. If you have the cash on hand to pay cash I’m assuming it’s in a bank and you have a relationship with them. You could even get a line of credit and rates would be even lower. (No clue if it operates the same in Canada).
 

·
Registered
Joined
·
2,070 Posts
Rates are low 2% in the US on such cars. Doesn't matter what kind of car. Well, at least through a bank/CU. No idea about some random auto financing company/arm.

Just go through your bank.
 

·
Registered
Joined
·
37 Posts
I am in Toronto and I have a 5 year locked in rate of 1.9% for a line of credit. Look around, you will get better rates. Pfaff rates are pretty standard, they are there to make money, obviously.
 

·
Registered
Joined
·
1,543 Posts
Used car vs. new and how used does matter.


In USA; you can get a good lease rate from Chase on a used Mclaren car if it is sold through a mclaren dealer and has less then 1000 miles on it.



Quick google search for used cars:


Average Used Auto Loan Rates in February 2021
Credit ScoreInterest Rate
750 or higher5.12%
700-7496.34%
600-69911.75%
451-59918.31%
450 or lowern/a
These rates were provided by our partner, myAutoLoan.

Average Used Auto Loan Rate for Excellent Credit
Credit ScoreInterest Rate
750 or higher5.12%
Borrowers with top-notch credit get the lowest used car financing rates, on average. Consumers with credit scores 750 points or higher are considered to have excellent credit. Lenders see them as being likely to make all of their monthly payments on time and pay off the loan as agreed.

Borrowers in this range shopping for certified used cars may qualify for special financing incentives offered by automakers. You can see these offers on our used car deals page.

Average Used Auto Loan Rate for Good Credit
Credit ScoreInterest Rate
700-7496.34%
Borrowers with credit scores between 700 and 749 may have a ding or two on their credit reports, but lenders still consider them to be pretty low risk. They can expect lower-than-average interest rates from banks, credit unions, and other financial institutions but will find it difficult to qualify for special financing incentives from automakers.

Average Used Auto Loan Rate for Fair Credit
Credit ScoreInterest Rate
600-69911.75%
Getting a car loan when your credit is between 600 and 699 can be significantly more expensive than it is for borrowers with better credit scores. In fact, the current average interest rate is more than double what it is for prime and super-prime credit borrowers.

A good strategy if you get one of these loans is to make all of your payments for a year or so, then refinance at a lower rate since you can show a track record of making payments and have built up significant equity in the car. Read our article on refinancing a car to learn more.

Average Used Auto Loan Rate for Bad Credit
Credit ScoreInterest Rate
451-59918.31%
Lenders consider borrowers with credit scores below 600 to be “subprime.” They see them to be far less likely than average to make their monthly payments on time or completely pay off the loan. Some lenders won’t lend to subprime borrowers. Others will, though, but you’ll have to pay for the added credit risk by paying significantly higher interest rates than borrowers with better credit scores.

Read our article on how to buy a car with bad credit to learn more about buying and financing a car when you don’t have a very good credit score.

Average Used Auto Loan Rate for Deep Subprime Credit
Credit ScoreInterest Rate
450 or lowern/a
If your credit score is 450 or lower, you will have a tough time finding a lender to give you an auto loan. If you do find one, you’ll have to pay exorbitant interest rates that will add thousands to the total price of your car. The deep subprime market is also where you find unscrupulous lenders who can put desperate buyers into debt traps that are nearly impossible to escape.

Nonprime buyers often have auto loan delinquencies or defaults in their credit reports, which makes lenders especially cautious when considering an application.
 

·
Registered
Joined
·
3 Posts
Pfaff rates are crazy. I just purchased my 720s from them. Paid cash. Better off taking a loan at Prime -10bps and investing it as you get the tax benefits on cost of funds.
 

·
Registered
Joined
·
1,305 Posts
Maybe the dealer is padding their profit with interest from the bank?. Mclaren corporate has no skin in the game as their leasing partnership is now with Chase bank.
Just like everyone else said, you should do your homework with your own banks for car loan rates and compare.

The only high interest rates that I can imaging are car loans more than 72 months.
 

·
Registered
Joined
·
1,543 Posts
Those seem pretty far off to be honest. My CU offers me 2-3% on used cars, constantly.
I was just sharing what i saw... I do know that one will get the better lease rate and residual with Chase if you buy a used car from a mclaren dealer and it has less then 1,000 miles.

Ferrari side is better residuals for lease purposes if the used car is less then 2,500 miles and purchased from a Ferrari authorized dealer.

O.P. must have done his due diligence with other lenders before he decides to seek information from this forum, (I hope).
 

·
Registered
Joined
·
444 Posts
I was just sharing what i saw... I do know that one will get the better lease rate and residual with Chase if you buy a used car from a mclaren dealer and it has less then 1,000 miles.

Ferrari side is better residuals for lease purposes if the used car is less then 2,500 miles and purchased from a Ferrari authorized dealer.

O.P. must have done his due diligence with other lenders before he decides to seek information from this forum, (I hope).

i thought ferrari leases were poor?
 

·
Registered
Joined
·
1,543 Posts
i thought ferrari leases were poor?
Ferrari has their own finance arm. They set higher residuals, hence lower payment and they bundle the loans quickly and sell as packaged securities.

One of my friends bought a brand new Pista and a used 720s spider with a few hundred miles. The residual from ferrari finacial was higher and his lease payment on a brand new pista was $100/month higher then the 720s spider.

Dealers (specifially Ferrari); will sell used cars at a higher price then re-sellers because they offer better residuals and hence lower payments.

Generally, sellers highlight the payment rather then the cost of the car.
 

·
Registered
Joined
·
24 Posts
Discussion Starter · #15 ·
Pfaff rates are crazy. I just purchased my 720s from them. Paid cash. Better off taking a loan at Prime -10bps and investing it as you get the tax benefits on cost of funds.
Thank you for responding, I'm glad to have someone who is local and dealt with the same issue. May I ask what you mean by tax benefits via borrowing on a loan at Prime? Furthermore, we're you offered any incentives by Pfaff on your purchase? Any financial discounts?

Thank you!
 

·
Registered
Joined
·
3 Posts
I was in the same boat as you. I purchased a 2018 720s. The market is crazy as you stated not a lot of movement on prices. They are willing to sit on their inventory right now so don't expect more than a 10K discount. A lot of the cars being sold are on consignment as well. I ended up paying cash. In my case I used funds that were invested in stocks to pay for the car. So what I did in turn was used my home equity line a of credit ( 2.35% rate) and invested the equivalent amount of the value of the car into the stock market. The funds you borrow for the investment are tax deductible at your marginal tax rate (highest rate is 53.53%), making the effective rate of the loan 1.09% in my case. In my mind the car is the back stop to the loan and I still have the funds to invest at a minimal cost. Hope that makes sense. Just the way I rationalized the purchase given I am not overly leveraged right now anyway. :)
 

·
Registered
Joined
·
16 Posts
Is it 5.99%, or 6.99%? I believe it's the latter, unless they've changed it recently.

Also, the rate is pretty standard for super cars in Canada, given that you're doing an open ended lease. Have you shopped Lamborghini? They're rates are worse than Pfaff, and they're even offering Pfaff leases in their shops now to close deals.

There are many scenarios here that could work. However, you're asking a bunch of random people on a forum what's the best route. Nobody knows anything about you, except you could possibly afford to buy the car with cash.
 

·
Registered
McLaren 570GT
Joined
·
22 Posts
Hey everyone!

Around a year ago I made a thread titled "Covid 19 and 720s pricing". Based on the uncertainty of the market and unprecedented scenario unfolding at the time, I thought it best to hold off any purchase.

Well suffice to say, the market definitely took a turn....and not in the way many of us were expecting, especially for the used market. That being said, I am tired of trying to time the market and am relatively hard set on finalizing a purchase of a CPO 18 or 19 720s. The thing is, the rates I am getting quoted from Pfaff Financing (the automotive group who owns all the McLaren dealerships in Canada) are absolutely absurd. Financing rates across all terms whether it be a 12 month or a 72 month term are 6.00%....which is insane. I am able to pay cash for the vehicle, however would much rather retain that capital on tap in the event I would like to invest in a few potential ventures.

So....am I out for lunch here? Or is 6.00% a new reality for upcoming McLaren owners? Credit is excellent and history is thoroughly comprehensive. Does anyone have any insights or suggestions?

Thank you once again for all of your responses!

Khan
Well, either your credit is not as good as you think it is - or you’re being screwed… They’re offering 1.99% (for pre-owned 2017-2021) from my credit union ATM.
 

·
Registered
Joined
·
37 Posts
Well, either your credit is not as good as you think it is - or you’re being screwed… They’re offering 1.99% from my credit union ATM.
That’s a very arrogant statement. Pfaff dealer rates are set, most they will give off is 0.5% off for loyalty, US is in a low interest rate environment right now, I for one would not lend money out at such ridiculously low rates.
 

·
Registered
McLaren 570GT
Joined
·
22 Posts
That’s a very arrogant statement. Pfaff dealer rates are set, most they will give off is 0.5% off for loyalty, US is in a low interest rate environment right now, I for one would not lend money out at such ridiculously low rates.
Eat balls Ken….he asked for opinions…
 
1 - 20 of 32 Posts
Top