OK.
OP: Cars don't require a big down payment. If you can't scrape together \~$1-2k or so in cash for a down payment, you can't afford a car. I can't tell if you're really in rough financial straits, or if you're just trying to play financial games to trick "the man" with some gimmick.
My position is:
I want enough liquidity.
I already stated that the APR offered in either case is about the same.
The only real difference here between a car and a personal loan is the collateral.
Why let the lender have a lien on the car if there's no real interest rate difference?
Every car loan I've seen requires 100/300 in liability, a lot of them now require 100 in property damage, AND they require $500 on comp and collision. If you own the car, you can do a 50/100/50 with whatever deductible you want for comp and collision, and you've not violated the terms of the car loan.
And yes, insurance companies alert the finance company whenever you make changes to your policy, it's in their interest to, because as soon as the lien holder starts sending out nasty letters threatening to repo your car, back go the higher limits.
Insurance companies that know you have no choice because of a lien get very aggressive on insurance premiums because what are you going to do about it.
Yeah, I was looking at it one way or the other, and car finance companies want high coverage policies, obviously, because they want to make sure that if you hit someone that sues you, you're not too wiped out to finish paying off your car note, which is likely to be underwater due to depreciation and dealership finance room shenanigans.
And that does make sense, for them. But it also adds, possibly, over $1,000 a year to the cost of insuring the car, beyond anything you're actually likely to hit.
Insurance companies are very good at their job, and their job is _not_ paying large checks. They have mastered the art of waiting people out and getting them to settle for peanuts. So the vast majority of cases settle for well under your limits. And they know this, and that's why they love selling extra units of coverage.
So regardless of whether there's half a point difference in interest is at this point irrelevant, because the insurance company has you by the short and curlies.
Interesting. Specifically, this is what the Amex personal loan terms and conditions say:
“Personal Loans may not be used for post-secondary education expenses, real estate, business, securities, vehicle purchases (other than as down payment for a vehicle), or any purpose prohibited by law or not otherwise permitted by these terms and conditions or your Loan Agreement.”
So not school, not real estate, not business opportunities, not stocks, not vehicles and not anything we don’t expressly say you can.
That certainly covers most needs besides debt consolidation. But correct, they have no way of enforcing any of that.
If they do, I don't see it.
Also, they have an article that says sometimes using a personal loan to buy a car is a good idea, then they say you can't use theirs to buy a car, except as a "down payment".
They won't enforce this rule if you did use the money for a car, but it's very likely you can get better terms for an auto-specific loan.
Auto loans are secured and therefore lower risk to the lender. That means they can give a better interest rate.
I haven't done anything, so there's nothing to admit to.
I was asking a question.
CNBC says they have the option of calling the loan if they figure it out, which would be bad all by itself because you took the loan so you could buy the thing, and now where do you get money for the entire remaining amount?
AmEx is a full service bank, so if you have a Checking or Savings account you could have them deposit the entire amount of the Personal Loan into one of those accounts if you wanted to.
But if your next stop is the car dealer after they said no cars, I probably wouldn't.
Incorrect. My primary savings and checking accounts are at Amex (granted, they are handled by Synchrony or some other bank, I think). OP, I have taken out a personal loan from Amex. I think you are free to do as you choose with that money, and there is no reason for them to ask you what you did with it. Could say debt consolidation, etc. Not legal advice.
How about the Rewards Checking. I got pinged with an offer for that. They say it only goes to cardholders in good standing for at least 3 months, so it's not something you can just go sign up for unless you can get at least some credit card AmEx has.
The regular checking you can get without a previous relationship with the bank.
I have had an Amex card for a few years now. Got the rewards checking offer, signed up and got the bonus last year. Kept it because its no fee. Use their savings anyway because it has competitive rates.
Idk what to tell you about your questions but I’ll tell you this as someone that burned Amex and had to work hard af to be “friends” with them again - not recommending you blow up your own spot, but maybe ask those chat agents on the app some of your questions just hypothetically for clarity. I’m telling you for certain - if you owe Amex money and you try to not pay, some way, some how, they will get their money. Ruthless is one word. But if you pay your shit they don’t give AF as long as it isn’t illegal. They’re a very persnickety entity to do business with.
I do think for what you said, if you take out the personal loan and deposit into say your Chase checking, as long as you pay on the Amex personal loan, they won’t give a F what’s done with the money.
I don't think they would be pissed and looking to file fraud charges unless the loan went bad. Like, if you did something that was a total outrage like got a personal loan, bought a car, then bankrupted the loan, they would probably go digging and not just be in the 341 meeting demanding to be excluded from the bankruptcy, but also reaching out to the prosecutor, especially if there was all or most of the loan left to go.
So, what I'm getting is if you can pay it back, maybe, if you can't pay it back, don't even try it.
They wouldn't know and they probably don't want to know.
Agreed. But OP, if you want to buy a car, just get a car loan. I can't fathom that the AMEX personal loan is more favorable.
Sounds like OP wants to use the personal loan for the down payment
OK. OP: Cars don't require a big down payment. If you can't scrape together \~$1-2k or so in cash for a down payment, you can't afford a car. I can't tell if you're really in rough financial straits, or if you're just trying to play financial games to trick "the man" with some gimmick.
I mean I don't think it's a particularly good idea either.
My position is: I want enough liquidity. I already stated that the APR offered in either case is about the same. The only real difference here between a car and a personal loan is the collateral. Why let the lender have a lien on the car if there's no real interest rate difference? Every car loan I've seen requires 100/300 in liability, a lot of them now require 100 in property damage, AND they require $500 on comp and collision. If you own the car, you can do a 50/100/50 with whatever deductible you want for comp and collision, and you've not violated the terms of the car loan. And yes, insurance companies alert the finance company whenever you make changes to your policy, it's in their interest to, because as soon as the lien holder starts sending out nasty letters threatening to repo your car, back go the higher limits. Insurance companies that know you have no choice because of a lien get very aggressive on insurance premiums because what are you going to do about it.
OK. You do you, man.
Yeah, I was looking at it one way or the other, and car finance companies want high coverage policies, obviously, because they want to make sure that if you hit someone that sues you, you're not too wiped out to finish paying off your car note, which is likely to be underwater due to depreciation and dealership finance room shenanigans. And that does make sense, for them. But it also adds, possibly, over $1,000 a year to the cost of insuring the car, beyond anything you're actually likely to hit. Insurance companies are very good at their job, and their job is _not_ paying large checks. They have mastered the art of waiting people out and getting them to settle for peanuts. So the vast majority of cases settle for well under your limits. And they know this, and that's why they love selling extra units of coverage. So regardless of whether there's half a point difference in interest is at this point irrelevant, because the insurance company has you by the short and curlies.
Interesting. Specifically, this is what the Amex personal loan terms and conditions say: “Personal Loans may not be used for post-secondary education expenses, real estate, business, securities, vehicle purchases (other than as down payment for a vehicle), or any purpose prohibited by law or not otherwise permitted by these terms and conditions or your Loan Agreement.” So not school, not real estate, not business opportunities, not stocks, not vehicles and not anything we don’t expressly say you can. That certainly covers most needs besides debt consolidation. But correct, they have no way of enforcing any of that.
I’m pretty sure AMEX has auto financing as a separate product
If they do, I don't see it. Also, they have an article that says sometimes using a personal loan to buy a car is a good idea, then they say you can't use theirs to buy a car, except as a "down payment".
They won't enforce this rule if you did use the money for a car, but it's very likely you can get better terms for an auto-specific loan. Auto loans are secured and therefore lower risk to the lender. That means they can give a better interest rate.
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I haven't done anything, so there's nothing to admit to. I was asking a question. CNBC says they have the option of calling the loan if they figure it out, which would be bad all by itself because you took the loan so you could buy the thing, and now where do you get money for the entire remaining amount?
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AmEx is a full service bank, so if you have a Checking or Savings account you could have them deposit the entire amount of the Personal Loan into one of those accounts if you wanted to. But if your next stop is the car dealer after they said no cars, I probably wouldn't.
Incorrect. My primary savings and checking accounts are at Amex (granted, they are handled by Synchrony or some other bank, I think). OP, I have taken out a personal loan from Amex. I think you are free to do as you choose with that money, and there is no reason for them to ask you what you did with it. Could say debt consolidation, etc. Not legal advice.
How about the Rewards Checking. I got pinged with an offer for that. They say it only goes to cardholders in good standing for at least 3 months, so it's not something you can just go sign up for unless you can get at least some credit card AmEx has. The regular checking you can get without a previous relationship with the bank.
I have had an Amex card for a few years now. Got the rewards checking offer, signed up and got the bonus last year. Kept it because its no fee. Use their savings anyway because it has competitive rates.
Idk what to tell you about your questions but I’ll tell you this as someone that burned Amex and had to work hard af to be “friends” with them again - not recommending you blow up your own spot, but maybe ask those chat agents on the app some of your questions just hypothetically for clarity. I’m telling you for certain - if you owe Amex money and you try to not pay, some way, some how, they will get their money. Ruthless is one word. But if you pay your shit they don’t give AF as long as it isn’t illegal. They’re a very persnickety entity to do business with. I do think for what you said, if you take out the personal loan and deposit into say your Chase checking, as long as you pay on the Amex personal loan, they won’t give a F what’s done with the money.
I don't think they would be pissed and looking to file fraud charges unless the loan went bad. Like, if you did something that was a total outrage like got a personal loan, bought a car, then bankrupted the loan, they would probably go digging and not just be in the 341 meeting demanding to be excluded from the bankruptcy, but also reaching out to the prosecutor, especially if there was all or most of the loan left to go. So, what I'm getting is if you can pay it back, maybe, if you can't pay it back, don't even try it.
Agree.