Is this your FICO auto score?
1 Like
The $405 is actually with tax included! (So pretty close to the Autoninja quote I believe) but I am also looking into just working with them to streamline things!
Thank you again to you and @max_g for all of the feedback I feel like Iāve learned so much not just on leases but how to thinking more thoroughly on what might qualify as a deal when it comes to leasing OR buying.
1 Like
Wow this is extremely helpful - I had no idea there was any deals for 72 month financing which I typically avoid but at 1.9% APR it might actually make a lot of sense (any chance you guys also assist in negotiating finance deals? haha)
Additionally that Tucson deal sounds really enticing if I decide to just go the stress free route and lease(max donāt yell at me haha). Let me check a couple of dealerships regarding the financing and if theyāre being too difficult Iāll send you guys a notice!
1 Like
Yes Fico auto score for the wife, although after pulling it we noticed its not showing her 2 largest accounts due to a bank error which we are correcting now - so Iām sure it will be higher but wanted to understand the implications assuming worst case scenario it didnāt change.
Our deals are available for lease or finance, typically a manufacturer will have other longer term subvented rates if they advertise low APR offers for short terms, they just donāt advertise as they allow dealers to mark this up, typically 1%. So you may find dealers quoting 2.9% for 72, if you see this it is due to them marking up the rate for reserve profit.
-Matt
oh interesting, if I wanted to explore financing with you guys - is it as hassle-free as Iāve heard the leasing is?
What would be the best way for me to see what rates you would be able to get (1.9% vs. 2.9% vs. 3.9%)? - I think the spreadsheet defaults to 3.9% for the southeast mazda section, so is this already locked in?
Apologies in advance if I misinterpreted any aspects of how the process works!
Hi Joel, I think you may be a little confused on how brokering typically works, these are pre-negotiated deals with existing dealer relationships with specific dealers of ours. We donāt assist in negotiations per se, rather we already have negotiations made and then advertise these deals. This typically includes certain aspects from our dealers, such as no markup on rates (save for some exclusions in some rare cases) and honoring the discounts we agreed to. The only variability on rate would come down to your approval with the lender, but as long as you qualify the dealer will honor. These tiers and rates are set in stone by the manufacturer due to them being a āsubvented APRā or āSpecial APRā program. i.e. if customer is tier 1, they get 1.9%, if customer is tier 2 you get 2.65% if customer is tier 3 you get 4.85%, and so on.
Tiers are based on score pulled, however even this isnāt really something that is completely straightforward. Sure, if your credit is consistently in the 700+ range and you donāt have any financial situations present, you donāt really need to worry about this aspect, but if you are sitting in the good/average range then a lot can change between tiers in theory. The counter to that is, banks will typically accept dealer credit scores for tier bumps and discretional tier bumps.
I was a Mazda sales manager for 5 years (albeit most of that time Mazda was with Chase, only spent a short time working with Toyota as Mazdas new and current lender). Letās say the bank uses Experian, the dealer may pull a 690 (Tier 2) Experian, but they submit and get a Tier 3 and the bank says they pulled a a 670. The customer also has Credit Karma which tells them they have a 655 FICO. Dealer calls the bank and says hey we pulled a 690 on Experian, bank will say okay send us copy of the 690 score and their bureau pulled and we will bump the tier to match your score to Tier 2. Dealer then says, hey bank the customer wonāt close and weāre going to lose this deal, we need you to get us a Tier 1 approval so we can get our deal done. Bank analyst (1st level rep) will say okay let me send the request to a manager for review; that manager has been working with this dealer for years and has a great relationship, sees they send a lot of good contracts through, they give them a Tier 1 approval despite the customer not actually qualifying. This is how automotive lending works when dealing with a captive (manufacturer supported) lender. I have had customers how me their score as a 750 and us and our banks pull 650s, Iāve also seen customers think they have a 650 and pull a 750 and have zero issues qualifying for Tier 1 rates.
This is why I always advise customers that are in this position to expect all possible outcomes and understand the potential for any of those outcomes to happen, but also understand its completely possible that despite having some credit hurdles that you may get to have your cake and eat it too.
So in short, if you were to work with us or any other broker, you would agree to the terms they quote you, they will collect your details and documents, select and reserve a vehicle in inventory with one of their dealer partners and then submit your order to the dealer. Dealer will review, submit to the bank for approval, then give the broker the green light on scheduling delivery/pickup. You pick up the car or have it delivered and paperwork is typically prepared and straight forward, all of the added dealer BS cut out. Done. Since you MAY fall at a 690 tier, your best case is 1.9% (Tier 1) or most likely worst case is 4.85% (Tier 3), with decent odds youāll fall between at 2.65%. Ultimately that will depend on what the lender and dealer pull for score and if the dealer can negotiate a better tier with the bank, if needed.
Here is a 72 month finance estimate on a CX50 Select, you can change your credit score right in our calculator to see how they would affect the buy rate.
P.S. Mazda does Tier 1+ for tier 1 technically, then Tier 1 for tier 2 - I just referred to these as 1, 2 and 3 in this write up to keep it simple but I am aware of their tiering naming system being slightly different than I stated.
-Matt
4 Likes
I wish you posted this into a brand new thread on LHā¦ this is some of the most well-written content about lending and lease rates. But itās going to be lost forever in some random deal check thread about a Mazda CX-50.
The thing Iād like to add about the Tiers is that many auto lenders have switched over to using VantageScore 3 or 4. This is a score thatās provided as a joint effort with the 3 major bureausā¦ so itās less exposed to the issue where an individual buyer is quoted one score from one bureau when researching a vehicle, but then sees a vastly different score during underwriting.
Youāre seeing fewer instances of a bankās underwriting / credit ops folks overriding things. Manual overrides start to introduce possible biases against protected classes and messes with the credit risk models that rely on data-only (and thus can be defended to not inadvertently skew to favor a class of borrower).
For example, a dealership here in NorCal can see a potential buyer has a zip code in Oakland (not Piedmont), and decide not to spend extra effort trying to bump up the client to Tier 1. But the same dealer may see a borrower from Palo Alto and think itās totally worth the effort because their gut tells them so.
@AutoNinjas , whatās your recommendation about a car buyer trying to get pre-qualified (or pre-approved) from MFS (or TFS) before they shop? This would let the person know what MFS Tier they fall in, and take out a lot of ambiguity.
The issue I see here is that the client would need to provide a dealerās info, which may screw with the attribution of who gets credit for this client.
2 Likes
Thank you very much for the compliment!
I personally wouldnāt apply through the generic application, only the dealer one, after coming to terms with our deal (or similar).
Sometimes in those circumstances where someone is on the cusp of two tiers, we can leverage our relationship with the dealer to get them bumped into the next one. Cannot guarantee it, but a relationship definitely helps!
1 Like
I was thinking the same thing - I just updated the name of the post to reflect the conversation (let me know if you have any better suggestions!)
Once again thank you so much for all of the in-depth information you shared on this post - I really appreciate it!
1 Like
Thank you for this breakdown! I apologize for the misunderstanding on my end - Iāve focused most of my learning these past couple of weeks on the leasing details and not as much on the auto broker aspect.
This breakdown is extremely useful and informative so thank you so much for taking the time to explain.
Also for anyone wondering I ultimately decided to go with Autoninjas on an Ioniq 5 Leasing deal they recently posted here in Florida - will make a full post on it once the details are completed!
3 Likes
This topic was automatically closed 60 days after the last reply. New replies are no longer allowed.