Financing the 2022 Lightning Purchase - Add Your Options

[RickLightning]

For those considering financing on their own, you have to be a fool not to take Ford Options, with whatever incentive they give, and then refinance the way you intended to. On the Mach-E, that was $1,000 and $2,500 depending on where you live. Lower now.

I just got my 5/29/21 Mach-E order and took the 0.9% 4 year loan that was in existence at the time of purchase as a promotional rate. 2.25% Ford Options with $1,000 can't compete with that.

Sponsored

 

[gorwell]

you have to be a fool not to take Ford Options,

This assumes Ford offers an incentive; given that there is no information of said incentive for F150L, I would assume it isn't going to be offered.

 

[metroshot]

This assumes Ford offers an incentive; given that there is no information of said incentive for F150L, I would assume it isn't going to be offered.

That's what I am afraid of - Ford Credit won't offer a subvented rate like they did with the MME.

We'll have to wait until the Lightning deliveries start to choose between:
Red Carpet Lease
Ford Options
Non subvented rate
Ford subsidized low APR
Ford Flex
Your own financing / CU

 

[GDN]

That's what I am afraid of - Ford Credit won't offer a subvented rate like they did with the MME.

We'll have to wait until the Lightning deliveries start to choose between:
Red Carpet Lease
Ford Options
Non subvented rate
Ford subsidized low APR
Ford Flex
Your own financing / CU

I don't have the details of those plans, but if they don't put something sweet into Options like they did for the MME, I'm guessing that last option is the only real one for me.

Knowing the dealers get some good kickbacks on the rates, if my dealer wants to split his kickback with me I'd take that and then refinance in a month.

 

[RickLightning]

I don't have the details of those plans, but if they don't put something sweet into Options like they did for the MME, I'm guessing that last option is the only real one for me.

Knowing the dealers get some good kickbacks on the rates, if my dealer wants to split his kickback with me I'd take that and then refinance in a month.

If you want to do that (which is probably not legal), you'll have to wait 3 months for him to get his incentive.

 

[metroshot]

I don't have the details of those plans, but if they don't put something sweet into Options like they did for the MME, I'm guessing that last option is the only real one for me.

Knowing the dealers get some good kickbacks on the rates, if my dealer wants to split his kickback with me I'd take that and then refinance in a month.

Good idea about using Ford's financing and splitting the dealer incentive w/ FMC.

I am hoping Ford will make Options more palatable than traditional financing on their first year 2022 Lightning.

Since Ford is hedging their bets on a successful Lightning launch, I am sure they will offer subvented rates and maybe an incentive.

If they don't my CU has the best rates and Ford will lose out on their finance arm...

 

[RavenYZF-R6]

Do we know what dealer incentive is for Ford Financing? Does it depend on amount financed? What rate they stick you with?

 

[RickLightning]

The dealership gets paid an incentive by Ford Credit if you keep their financing for 3 months.

Ford Credit gives them a rate. They can increase the rate, within limits. They don't tell you that part.

 

[Maquis]

That's what I am afraid of - Ford Credit won't offer a subvented rate like they did with the MME.

We'll have to wait until the Lightning deliveries start to choose between:
Red Carpet Lease
Ford Options
Non subvented rate
Ford subsidized low APR
Ford Flex
Your own financing / CU

You won’t qualify for the $7500 tax credit with a Red Carpet (or any other) Lease!

 

[metroshot]

You won’t qualify for the $7500 tax credit with a Red Carpet (or any other) Lease!

yes I am aware of that.

I am also looking into use of Ford's Commercial Line of Credit to finance it thru my business - haven't decided.

In case I want to register it for my business, I have the choice between CLOC or using my business line of credit that will cover the purchase, but the interest rate is quite high....

No matter which method I choose, I will use the IRS Section 179 to take a large tax credit since it weighs over 6,000 lbs.

 

[Maquis]

yes I am aware of that.

I am also looking into use of Ford's Commercial Line of Credit to finance it thru my business - haven't decided.

In case I want to register it for my business, I have the choice between CLOC or using my business line of credit that will cover the purchase, but the interest rate is quite high....

No matter which method I choose, I will use the IRS Section 179 to take a large tax credit since it weighs over 6,000 lbs.

Section 179 results in a deduction of income, not a credit.

 

[TaxmanHog]

Section 179 results in a deduction of income, not a credit.

Correct, and depending on ones income tax bracket and applicability of self employment taxes, that could have substantial value

 

[Maquis]

Correct, and depending on ones income tax bracket and applicability of self employment taxes, that could have substantial value

Absolutely. I was only trying to point out that taking advantage of section 179 should not be 1) compared to; nor 2) be viewed as a substitute for the $7500 EV tax credit.

 

[Sdctcher]

My Lightning Financing Plan (Based on Current Assumptions)*
* Your Plan May Be Different Than Mine

Assume My Lariat Delivery ($80,000 MSRP) Late July
Assume Ford Options Plan 36 Month and 48 Month @4.9%
Assume Ford Options Plan 36 Month Residual 50% ($40,000 Balloon)
and 48 Month 40% ($32,000 Balloon)
Assume No Ford Incentives or Subversion of Interest Rate
Assume Best CU/Bank Rate of 3.5% Level at 36/48/60 Months
Assume I Will Pay Off Loan(s) in Six Months
Assume the Loan will Include Only MSRP - Other Delivery Fees are Paid Cash
Assume I Will Have Sold My Extra Vehicle and Gotten My $7,500 Tax Credit in Six Months

Ford Options 36 Months:
$80,000 (MSRP) - $20,000 (Down Payment) = $60,000 Financed
Balloon Payment $40,000 (So Not Included in Principal Payback)
Payoff in Six Months $60,000 - $3,300 = $56,700
Initial Monthly Interest $250/Month @4.9%
Initial Monthly Principal $550/Month
Total Monthly Payment $800
Total Interest Six Months $1,470
Total Principal Paid Down in Six Months $3,300

Ford Options 48 Months:
$80,000 (MSRP) - $20,000 (Down Payment) = $60,000 Financed
Balloon Payment $32,000 (So Not Included in Principal Payback)
Payoff in Six Months $60,000 - $3,500 = $56,500
Initial Monthly Interest $250/Month @4.9%
Initial Monthly Principal $580/Month
Total Monthly Payment $830
Total Interest Six Months $1,470
Total Principal Paid Down in Six Months $3,500

Commercial Finance 36 Months:
$80,000 (MSRP) - $20,000 (Down Payment) = $60,000 Financed
Payoff in Six Months $60,000 - $9,900 = $50,100
Initial Monthly Interest $175/Month @3.5%
Initial Monthly Principal $1,650/Month
Total Monthly Payment $1,825**
Total Interest Six Months $1,050
Total Principal Paid Down in Six Months $9,900
**(I Cannot Qualify for This Payment)

Commercial Finance 48 Months:
$80,000 (MSRP) - $20,000 (Down Payment) = $60,000 Financed
Payoff in Six Months $60,000 - $7,500 = $52,500
Initial Monthly Interest $175/Month @3.5%
Initial Monthly Principal $1,250/Month
Total Monthly Payment $1,425**
Total Interest Six Months $1,050
Total Principal Paid Down in Six Months $7,500
**(I May Not Qualify for This Payment)

Commercial Finance 60 Months:
$80,000 (MSRP) - $20,000 (Down Payment) = $60,000 Financed
Payoff in Six Months $60,000 - $6,000 = $54,000
Initial Monthly Interest $175/Month @3.5%
Initial Monthly Principal $1,000/Month
Total Monthly Payment $1,175
Total Interest Six Months $1,050
Total Principal Paid Down in Six Months $6,000

I Understand that My Assumptions Probably Will Change in the Next Several Months but I Share Strictly as an Example of My Looking Ahead. These Figures Point Out the Importance of Ford Offering Incentives and/or Interest Rate Subversions, as they did with the Mach-E.

 

[Sdctcher]

Navy Federal Credit Union New Auto Rates
(As of May 25, 2022) * "Rates As Low As" ** 90 Day Lock

To Become a Member, you or one of your family or household members must have ties to the armed forces, DoD or National Guard.

Up to 36 Months 2.29%
37-60 Months 2.49%
61-72 Months 2.79%
73-84 Months 4.69%
85-96 Months 5.59%

PenFed Credit Union New Auto Rates
(As of May 25, 2022) * "Rates As Low As"

To Become a Member, Available to everyone.

36 Months 2.89%
48 Months 3.09%
60 Months 3.14%
72 Months 3.49%
84 Months 4.59%

Sponsored