• JayleneSlide@lemmy.world
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    2 months ago

    Liquidity. Buying a car on credit is mostly stupid, but there are cases when it makes some sense. My last car loan was 3.54%. My combined accounts were earning ~8%. Paying cash in that case would be throwing away money. Well, throwing away money on top of wasting it on a car.

    • explodicle@sh.itjust.works
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      2 months ago

      I’m doing the same thing, but I still don’t understand it. Why are creditors offering 3.54% car loans instead of just getting 8% themselves?

      • sunzu2@thebrainbin.org
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        2 months ago

        That loan was likely originated during a different intertest environment. So that commeneter is playing arbitrage

        • JayleneSlide@lemmy.world
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          2 months ago

          This is exactly the case. Also, I worked for a credit union at the time, and employees got a 1% discount on interest rates for loans over a 24 months.

        • explodicle@sh.itjust.works
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          2 months ago

          I can’t speak for the other guy, but these high interest investments were available when I took out my car loan too. That’s why I opted for the longer term loan.