Bankers must think we are all morons!!!!

[sao123]

I called the credit union to ask about a vehicle refinance loan, because I could go from 3.25% to 2.49% interest, possibly saving some money in lower interst. I still owe 470 a month for 48 months (originally 60). So I got my payoff value and gave the lady all the information, and she says your new loan at the lower interest rate will be $550 a month for the same 48 months, and you can save over $500 in interest. She said are you interested in accepting in this loan to save $500. I said absolutely not... She said, you can save over $500, why not?
I said to her 48 * 470 = $22500, $48 * $550 = $26500, why would I spend $4000 more to save $500? That doesnt make very good financial sense to me. I said explain to me why your loan costs me $4000 more at 1% less interest, so she got mad and hung up!

 

[Cuda1447]

It sounds like someone misunderstood something, possibly you. That doesn't make any sense.

 

[sao123]

It sounds like someone misunderstood something, possibly you. That doesn't make any sense.

I thought so too... I had her double check everything.

 

[FoBoT]

you can't do that over the phone, you need to look at the disclosure sheets and amortization schedules etc etc
they may have been trying to give you a bad deal or it might have been a mistake, can't tell for sure without looking at the numbers

 

[DAGTA]

Car dealers do this kind of thing all of the time. Probably happens in banks a decent amount of time.

 

[Joseph F]

LOL, I wonder how often people fall for that.

 

[Texashiker]

Bankers must think we are all morons!!!!

I called the credit union to ask about a vehicle refinance loan, !

Credit unions are not banks

 

[Joepublic2]

You probably deprived her of a commission or something is why she got mad.

 

[glenn1]

I thought so too... I had her double check everything.

She re-ran the calculations with your original loan amount rather than the payoff value. From the figures you provided, your original loan was probably $26,000 give or take a bit, which at 3.25% for 60 months = $470. She calculated for the original $26,000 @ 2.49 for 48 months = $570 instead of the proper payoff amount of ~$21,100; which refinanced for 48 months @ 2.49% should mean new payment of $462.97, which means you'd save about $336 over the term of the loan, minus whatever processing fees are involved.

 

[Lifted]

I thought so too... I had her double check everything.

And you wonder why they think we are morons?

 

[JackBurton]

I didn't even know you could refinance a car.

 

[Rage187]

I didn't even know you could refinance a car.

I had the same thought.

 

[wirednuts]

i like when you go to get a home mortgage (a small one like 80k), and they strive to sell you the 30 year. they say "the monthly payments are lower!" but they dont mention its a gigantic ripoff compared to a 15 year. even on their commercials, they say "its not about the rate, its about the monthly payment" and i cant believe people actually believe that... its completely opposite of the truth (which i think is another marketing scheme thats well known in the industry, just claim something thats 120% false and people will think its 100% true)

 

[glenn1]

I didn't even know you could refinance a car.

Sure you can, but the loan term is so short it's hardly ever worth the time or trouble no matter how much lower the rate is.

 

[Dr. Zaus]

Just look at the number of people that are morons.

not everyone needs to be a moron, just enough people.

 

[Jumpem]

i like when you go to get a home mortgage (a small one like 80k), and they strive to sell you the 30 year. they say "the monthly payments are lower!" but they dont mention its a gigantic ripoff compared to a 15 year. even on their commercials, they say "its not about the rate, its about the monthly payment" and i cant believe people actually believe that... its completely opposite of the truth (which i think is another marketing scheme thats well known in the industry, just claim something thats 120% false and people will think its 100% true)

The smart thing to do is get a 30 year, and then pay on it as if it were a 15. That way if you have a job loss, you can fall back to the lower amount.

 

[FoBoT]

Just look at the number of people that are morons.

not everyone needs to be a moron, just enough people.

oh that totally reminds me of this

 

[wirednuts]

The smart thing to do is get a 30 year, and then pay on it as if it were a 15. That way if you have a job loss, you can fall back to the lower amount.

:/ i dont think so (thats banker talk). in reality its way too easy for the average person to think their overpayment isnt necessary. and thats exactly what banks want you to do. better to lock yourself into a payment that you know you can make and are forced to.

if you lose your job and you cant afford the 15 year rate, then you shouldnt have got the loan in the first place.

besides, there are insurance programs you can get through your lender that cover you in times of despair for only a couple hundred more a year. not something that i would personally do, but it doesnt seem like a horrible idea either.

 

[wirednuts]

oh that totally reminds me of this

that guy was a true hippy, yet totally accurate on so many levels

 

[RbSX]

Credit unions are not banks

OP is a fucking idiot. Credit unions are the polar opposite of "bankers".

 

[Zenmervolt]

if you lose your job and you cant afford the 15 year rate, then you shouldnt have got the loan in the first place.

If you're not smart enough to keep yourself disciplined and pay off a 30-year mortgage in 15 years, then you're not smart enough to know that you shouldn't have gotten the 15-year loan in the first place.

Basically, you're trying to say that people are too dumb (on average) to stay ahead of their payments and pay off a loan early, but these same people are smart enough to be able to predict catastrophes and know exactly what they'll be able to manage if something catastrophic happens. If they can't even manage something as simple as the former, how on earth are they going to manage the latter?

ZV

 

[Dr. Zaus]

If you're not smart enough to keep yourself disciplined and pay off a 30-year mortgage in 15 years, then you're not smart enough to know that you shouldn't have gotten the 15-year loan in the first place.

If you are to not smart enough to understand that someone understanding his own behavioral patterns is smart then you are not smart enough to understand why many people benefit from a 15 year.

Basically, you're trying to say that people are too dumb (on average) to stay ahead of their payments and pay off a loan early

Basically, I'm saying that people that know that they are spenders and not savers (on average) and need their feet to the fire are much smarter than consider themselves to be masterful spenders, those that think they are perfect gODs of monetary control.

but these same people are smart enough to be able to predict catastrophes and know exactly what they'll be able to manage if something catastrophic happens.

You self-serving-bias-minded are the same people who are smart enough to ignore the perfectly valid "there is insurance for catastrophes" argument and think that the difference in payment between a 15 and a 30 will magically allow them to manage if something catastrophic happens.

f they can't even manage something as simple as the former, how on earth are they going to manage the latter?

If these people can't even understand how they delude themselves (30% say they will pay off their 30 in 15, 2% pay it off in 25 or less), then how on earth are they going to over-come the human tendency to spend-to-income?

 

[Cerpin Taxt]

Here's your problem:

I said to her 48 * 470 = $22500, $48 * $550 = $26500, why would I spend $4000 more to save $500?

48$ * 550$ = 26500$².

 

[Theb]

oh that totally reminds me of this

Made me think of this

 

[the DRIZZLE]

You probably spoke with someone in a call center making $12 who likely has no formal finance training. A real banker would buy up 10,000 auto loans from people with poor credit and put them in an SPV, sucker the ratings agencies into rating it AAA, and sell the whole piece of garbage to a pension fund while making 2.5% off the top. Then they'd turn around and buy CDS against the security that they knew would fail because they designed it.

In short, real bankers have bigger fish to fry then bilking you for $30/month.