Sorta, except there’s no collateral and you have a revolving sum of funds to draw from at any time during the first two years.
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do you know if there’s a penalty for pre-paying on the auto advantage program?
I have never been charged a penalty for paying off a paysaver loan early with PenFed.
Here are the most promising CU’s w/ a paysaver program:
Teachers Federal Credit Union (open membership)
AmeriCU Credit Union. (membership w/ donation)
I was not able to get into SEFCU or MountainCrest FCU.
I am also working with Vermont FCU, but they are not open membership.
In Michigan I used an AFG balloon loan from Frankenmuth Credit Union, which only required you to be a MI resident to qualify. When I closed the loan in October, the rate was 2.75% for up to 72 months on balloon (they call it Drive Sense Lease Lookalike). It is not at 2.99% at least until March when the Fed raises rates.
There are many credit unions nationwide that support the AFG loan, but have very quirky eligibility requirements, such as being in a teacher’s union, firefighter/police, member of certain church groups, etc. Keep digging and I’m sure you’ll find one near you.
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I remember how a 72 m loan was a novelty frowned upon, putting people severely upside down…Seeing a 96m option made my eyes pop…at 4%+
Crazy
Latest BALLON LOAN options (best to worst):
CapEd Credit Union (https://capedcu.com/)
They offer a payment saver loan option (via AFG) at a 3.84% rate. Membership to the CU is possible via a $20 donation to CapEd Foundation. Also offers a 2.14% rate for 96 months, so one application gives you both options. Uses transunion credit for initial score
Hanscom Federal Credit Union (https://hfcu.org/)
Better then a lease loan offering is backed by AFG at a 3.74% rate. Membership to the CU is possible via a $35 donation to Nashua River Watershed Association. Uses transunion credit for score.
AmeriCU Credit Union (https://americu.org/)
Membership via $15 one-time donation to American Consumer Council. Uses experian for credit score. Payment came back very high, not sure what rates/fees they used.
Teachers Federal Credit Union (https://teachersfcu.org/)
Open membership, anyone can join. Paysaver rates not posted, but you can apply for paysaver loan via the website. Uses transunion credit for score. Came back with a rate over 5%
Regional options (not-open-membership) to consider:
SEFCU (NY),
MountainCrest FCU (WA),
Vermont FCU (VT),
Frankenmuth CU (MI)
Lowest available BALLON LOAN rate found was 2.49% but I did not qualify. Note that fees charged between providers can vary. At minimum, expect a $725 origination fee for vehicles over $75K. In one case, I was quoted $1500 for origination. Expect a hard pull immediately after submitting your application online.
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Frankenmuth CU offering 1.99 for 48 months. Lowest I’ve seen.
This sounds like a conventional loan rate. For this product, DCU is the lowest.
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Just a DP for SEFCU Balloon Loan(Auto Advantage) .
2.49% rate with 800+ credit score, no hard pull. Went into my local branch to apply for the loan and CU membership. They required opening a Savings account for $1. Picked up the check the next day, the turnaround was really impressive.
Picking up the Model Y Performance next week.
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Does DCU hard pull to join for savings or checking like PenFed ?
PenFed is no longer a HP unless you apply for one of their credit products and a single HP can be used for multiple products
They are a great option if you are in region.
I tried getting membership, via various affiliated clubs and had no success.
What’s the play on a balloon at 3.84% vs a DCU at 1.24%? Don’t you still have to pay the full sales tax?
TIA
In NJ, there is no sales tax on EVs, but you are paying full sales tax on a conventional loan as well. There is a tax benefit of leasing, in most states, so the balloon loan makes sense where the captive lease MF is higher then 3.84%, or where the captive has restrictive policies for lease disposition. Both of these are true when considering Tesla financing.
ah! makes sense. thx
Probably going to get another EV in a few months, depending on what out there and if their leases don’t pass through the Fed credit… may consider these CU balloon payment programs.
Although when we ran the numbers on the Ford Options plan, it was about as high if not higher than the lease payment.
Planning to buy a Tesla for a short period of time roughly around 8 months, should I go for conventional loan or balloon payment? I’m in NJ so no sales tax on ev, leaning more towards balloon because of low monthly payment. Any advise?
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The cheapest financing is gonna be the DCU program at 1.29% for 65 months, but it certainly won’t result in the most friendly monthly payment. But if you are laser focused on the cheapest out, this is the clear best option in the market right. You will pay very little interest over your short term.
If instead you want to minimize your monthly payment, either a balloon loan or a long term conventional loan will achieve similar objectives for short term ownership. I used a balloon loan on both my Model S and my Model 3. My general approach is to go with a 24 month term and then try to put enough down to bring the loan balance right around the RV. This will result in a very small monthly payment, as you are only basically paying the debt service, for as many months as you plan on keeping it.
You can find alot of good discussion on balloon loans, and other options, in our Tesla discord. See;
You risk losing that large down payment in case of an accident tho, correct ?
Huh? You are still financing the vehicle, not leasing.
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