Poll: Ford Options vs Finance

[DBC]

Lol but why would you throw in $50-60k in short term to lose 30% (highly unlikely this will happen again in the next 10 years), statistically speaking,

You're underestimating volatility. This last year the S&P was at 3373 on 20 February and 2237 on 23 March. That's a 34% drop in a month.

With the CAPE ratio at 35, there seems to be more downside than upside in the US market at this time (which doesn't mean the US market won't go up).

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[efisher]

He means no incentive. The Options incentive is $2500 or $1000 depending on your state.

What states get the higher discount?

 

[DBC]

Edit: or will I be able to use the balloon amount as a floor for a trade on a new Ford?

Yes if FMV is greater than the balloon payment. Otherwise no. Also note you are not limited to a trade-in. If FMV is greater than the balloon, you can, for example, sell the MME to CarMax, which will pay off the balloon and cut you a check for the difference.

 

[DBC]

This is the most perplexing part of car buying. How is it determined what incentives should be by region?
...
Like I said there's probably a good reason but I've just never heard a great explanation.

What states get the higher discount?

I think the residents of CARB states. Makes sense because sales in these states generate cap and trade credits that Ford might otherwise have to buy.

 

[shutterbug]

Lol but why would you throw in $50-60k in short term to lose 30% (highly unlikely this will happen again in the next 10 years), statistically speaking, the chance that you make less than 2% on the market per year on average over 5 years is VERY low. But like I said, do as you please, I'm done with this conversation. Just take a finance class one time and those of you in disagreement will learn something.

Yep, back in 1999 all kinds of folks were saying the same. Then the stock market lost nearly half over the next 3 years and didn't get back to even for 10 more years.

 

[macchiaz-o]

I think the residents of CARB states. Makes sense because sales in these states generate cap and trade credits that Ford might otherwise have to buy.

There is a lot of intersection with CARB states but there are regions that can get the $2500 incentive even though they aren't within CARB, and vice versa.

Also, people should check their zip codes when checking which incentive is in play. For example, I think we saw that Honolulu residents can qualify for the $2500 incentive, but other Hawaiians may only qualify for $1000.

 

[JDRGolfer1]

You're underestimating volatility. This last year the S&P was at 3373 on 20 February and 2237 on 23 March. That's a 34% drop in a month.

With the CAPE ratio at 35, there seems to be more downside than upside in the US market at this time (which doesn't mean the US market won't go up).

Curious, how often do pandemics happen and the country gets shutdown? Can't consider 2020 as a normal year...not sure why this is still a topic of conversation. Also, like I said, don't invest short term and sell down 30%, S&P is now at 3841, that's 71.7% up from last March's low... Please don't respond, I don't want to read anymore responses

 

[JDRGolfer1]

Yep, back in 1999 all kinds of folks were saying the same. Then the stock market lost nearly half over the next 3 years and didn't get back to even for 10 more years.

I'd be pretty ok today if I invested 60k 1999, sure I'd be a lot better if I invested it in 2002 or 2003 but you can't time the market dips, if you can then you're hired.

 

[shutterbug]

I'd be pretty ok today if I invested 60k 1999, sure I'd be a lot better if I invested it in 2002 or 2003 but you can't time the market dips, if you can then you're hired.

No you can't. But if you are comparing buying a car in 1999 and you have a choice of borrowing that amount vs paying cash, you would have been better off paying cash. If you are certain that there is 0% chance of major market drop in the next 10 years, you're lying to yourself.

 

[JDRGolfer1]

No you can't. But if you are comparing buying a car in 1999 and you have a choice of borrowing that amount vs paying cash, you would have been better off paying cash. If you are certain that there is 0% chance of major market drop in the next 10 years, you're lying to yourself.

Have to consider the rates available at the time, with those rates back then, paying cash would be a no brainer. Times are different today.

 

[ARK]

Could someone explain what the potential sales tax issue is with Options on the ballon payment/turn in? I am in California.

 

[tomterky]

I'm working through a credit union and plan on buying it and keeping it. I was able to get $44,000.00 for 72 months @ 2.74% with payments of $665.00. Would Ford Finance have anything better? I want to keep payments in the mid 6.

 

[trutolife27]

I'm sitting here like. With this last delay how about 500 cashback off the mache or 1,000 free DC charging miles. Since we had another delay.

Surprised by all the chirping going on in here but together you all could move the needle for something for the delay.

But hey what do I know, I still have some popcorn leftover from last week. As you were.

???

 

[generaltso]

Could someone explain what the potential sales tax issue is with Options on the ballon payment/turn in? I am in California.

It‘s only an issue when comparing it to RCL. Since Options is a purchase, you pay sales tax on the entire purchase price. With a lease, you typically don’t pay tax on the residual.

 

[ARK]

It‘s only an issue when comparing it to RCL. Since Options is a purchase, you pay sales tax on the entire purchase price. With a lease, you typically don’t pay tax on the residual.

Thanks makes sense, and that entire sales tax would be due as part of your down payment then?

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