Finance Questions

Question: what exactly is 100 percent financing in the term of auto loans? Does carmax offer 100% financing?

Answer: One hundred percent financing is a marketing tool used to sell cars to the financially unsophisticated. An automobile loses value immediately upon purchase. On average, an auto loses ten to twenty percent of it's value the first month. Ouch!

So, purchasing a car with no down payment and extend term financing, meaning more than thirty-six months, puts the purchaser in a very precarious position. The car is not worth what is owed, possibly ever.

Simply pay cash for cars. If you don't have the money, don't buy it. No one else will tell you this, but I just did.

I made car payments for twenty-four consecutive years. I would be absolutely crushed if I actually knew how much cash I've mailed to car credit companies for nearly a quarter of a decade, and half of my life.

And now, I've finally paid off my Ford, I have money in the bank and it's building each month. If and when I need to replace the truck, I'll just pay cash. No more payments, no more interest, no more debt.

CarMax - Car Seat