Straight Line VS Step Up Financing

[GreatWhite]

Hi. I'm a newbie here. Just want to find out is any of the members here bought their F30 using Step Up financing by BMW Credit? The interest rate compare to the straight up financing is a lot more higher which is about 3.10%. Let's not talk about the total repayment but the easy ownership of a new F30. Is it worth to go for the step up financing if u really love F30? Or wait for another few more years?

 

[seancorr]

I'm using the conventional financing and the interest rate given is the important part to me because it affects the amount of free money you give to the bank!

 

[achtung]

buy used one.... mine for sale.
hehe :67:

 

[molasses917]

I took straight line financing, not only because of the lower interest rate. Step up financing means you'll be delaying the repayment of the loan to later in the lifespan of the car.

Simply put, when you want to sell it later you'll end up with a significant loan balance to repay (even may need to top up over the sale value to cover the loan). Happened to some people I know, wanting to sell the car after about 4 years but ended up having to fork out cash to top up to cover the loan, and on top of that more cash to pay the down payment for a new car.

 

[sh_Callum]

Bimmer consider a luxury car, assess what is affordable without landed up in a huge debt.

 

[muffinz]

Hi GreatWhite,

Step up financing appears to be a viable option if you're likely to sell the car before the loan repayment period is up (and to have a low entry cost with minimal downpayment), and would like that extra liquidity by paying a few hundred bucks less every month.

Do however bear in mind that the step up plans you see on BMW credit websites are promotional rates and only apply to pre-registered 2013 / demo 2013 models. Give BMW credit a call, it should be at the level of 3.68% per annum.

For straight line financing however, the general rate quoted now is 2.4% per annum and I'm hearing it can go as low as 2.31% depending on the loan amount/tenure/your documents.

The rest you can work out

 

[GreatWhite]

Thank you all of u for the replies and infos given. Really appreciate it. I'll check again more with BMW Malaysia.