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When you go car shopping, don’t forget to go loan shopping. Shopping for auto lenders is like test-driving cars — get a couple of offers, compare them and take what suits you best.
If a Ford is on your list, be aware that Ford generally requires its borrowers to have high credit scores, especially in order to qualify for the 0% financing ads you most likely see and hear. It does have a first-time buyer program though, and you may be able to drive away with one of Ford’s extensive rebates or incentives that doesn’t require you to finance with Ford in order to qualify for it.
Here we’ll review the company, its financing, rebates and incentives, lease options and alternatives so you can determine whether it might be a good lender for you.
Founded in 1903, Ford Motor Company is more than 100 years old. Until Ford established itself as a manufacturer for the masses, vehicles were not affordable except by the well-to-do. And Ford kept working to make them cheaper. Using an assembly line, Ford reduced the time it took to make a car by 88%.
The assembly line wasn’t the only way Ford revolutionized the industry. It doubled workers’ pay while cutting their work hours. Employees could often afford to buy one of the vehicles they helped make, giving the company a “blue collar” culture, which is suggested in the color of its logo today.
Ford Motor Credit Company is the financial arm of Ford Motor Company. It topped J.D. Power’s 2017 U.S. Consumer Financing Satisfaction Study for the mass market, and won first in the luxury market under its Lincoln brand. The company scored five stars across the board in both markets. Ford Credit finances new, used and certified pre-owned cars.
Like most manufacturer finance companies, Ford generally requires borrowers to have high credit scores; the average FICO credit score of borrowers in 2017 was 746. That is the average though, not a minimum credit requirement. You may be able to get Ford financing even if you have a lower score. This is where applying to multiple lenders and having multiple options would give you negotiating power.
If you don’t have an established credit history, Ford does have a first-time buyers program for those who don’t have a previous car payment on their credit history and meet certain stipulations such as having enough income.
If you’re unsure whether you’ll quality for Ford financing, try our auto payment calculator to see how a new car might fit into your budget, check your credit score for free and read up on getting preapproved.
If you do qualify, Ford financing offers terms from 36 to 84 months, although an 84-monthslong auto loan isn’t generally recommended. And if you are a top-credit borrower, you might be able to receive a Ford financing deal of 0% APR for up to 60 months. Other lenders, such as banks and credit unions, can’t match such manufacturer loan offers. How can a manufacturer afford it? Ford Credit doesn’t have to make profit on the loan — instead, they use the loan as an incentive to sell the vehicle, which helps the bottom line.
To apply for Ford Credit financing, you can go to the Ford website where you’ll need to supply personal information such as name, date of birth and your full Social Security number, contact details, employment status and gross annual income.
To attract customers and “salute those who serve,” Ford offers rebates and special deals. These incentives are specific to the vehicle’s location, the vehicle model you’re buying and the time of year. Details can change often, so for more information, see Ford’s website or visit a local dealer.
Here are some of the types and the main requirements for each.
Another general restriction is that some of these rebates do require you to finance with Ford. Usually when you have this option, you can choose between taking the rebates and taking a special low APR. If you do have this option, one thing you may be able to do is to take the rebate, finance at a regular APR with Ford, and then refinance with the lender who offered you the lowest APR. This way, you’d get both the low APR and the rebate.
The deals above are not inclusive of all the restrictions for the rebates and incentives — check out Ford’s website or visit a local dealer for exact details.
Leasing from Ford requires excellent credit. But if you do qualify, there are incentives available just as there are for buying.
Ford Red Carpet Leasing Program offers terms from 24 months to 48 months, with mileage options starting at 10,500 miles annually and going up to 19,500 miles annually. All leases limit the amount of miles you can put on the vehicle. The higher the mileage limit you choose for your lease, the more expensive it will be. Ford offers one of the highest lease mileage limits in the industry.
When your lease is over, you have three options: replace the car by leasing or purchasing another Ford, purchase the vehicle you’ve been leasing or turn it in. If you decide to turn it in, you may have to pay fees for any extra miles or excess wear. Note that you do have the option to buy extra miles and extra protection against wear ahead of time. If you buy the vehicle after the lease, you won’t be charged these fees.
You can check out this guide If you’re unsure on whether to lease or buy.
You wouldn’t just take the first car you got into, so why take the first lender you applied to? Get a couple of offers before you decide. LendingTree offers a tool to see up to five different offers from lenders at once for an auto loan where you may compare side-by-side deals. You can also check your bank, credit union or online to get a preapproval or a loan offer before you head out to the dealership.
It’s highly recommended to get multiple loan offers, especially if your credit is below the average credit score Ford financing accepts. Some lenders offer rate discounts on auto loans if you are a preferred member or use your checking account to make automatic payments. If you do get a loan offer from another lender and then go to the Ford dealership, you can show the dealership the offer you have and ask them to beat it.
Getting a loan offer from another lender won’t hurt your credit if you submit the applications within two weeks, plus it gives you leverage to negotiate.
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