My partner is a Japanese international student whose visa expires in April of next year. She needs a car to travel now that she has a new job. We went to the showroom and paid $7,500 for a 2016 Hyundai Sonata. She will finance the remaining $6,000 after making a $1,500 down payment, but according to them, the annual percentage rate (APR) for first-time purchasers without co-signers is 29%. Isn’t this nonsense? Her credit score is 707, which is far too high. We intend to phone a few credit unions to shop around for better vehicle loans. In her case, what percentage APR is appropriate, and should she consider refinancing?
Please do not do that. No, no. Did I say “no”?
Yes, it seems like you could find a better solution. However, considering her visa status and the uncertainty surrounding her ability to remain in the nation after the next extension, obtaining a vehicle loan might come with a higher interest rate to protect the lender in the event that she is unable to repay the debt.
This is one of the regrettable facts of being a foreign national living overseas, having lived there. They are not acquainted with anyone else who might apply for a loan and then disappear. I’ve heard a number of tales of foreigners racking up massive credit card debt or putting in applications for auto loans only to decide later that they didn’t want to prioritize that.
Wow, 29% APR is super high! It’s great that you’re looking around for better options. Don’t settle for that 29%! With some research and effort, you should be able to find a much better deal for your girlfriend’s car loan.