Vehicle Details: Best Cars for Summer

Get ready to hit the road in style
With the warmer months finally here, it’s time to start planning that summer vacation you’ve been dreaming of. Here are a few vehicles that are ideal travel companions whether you’re heading out alone or with the family.

Kia Soul
For the money, you can’t get much better than the newest Kia Soul. Currently residing as the No. 1 ranked Compact by U.S. News & World Report, the Soul was also named to the Best Cars for the Money and Best Cars for Families list. The Soul (MSRP $16,100) is available in Base, + and ! trim levels, and is now also available with a turbocharged 1.6-liter four-cylinder engine that makes over 200 hp. You can haul over 60 cubic feet of stuff, and the Soul can also be equipped with leather upholstery, ventilated front seats and a Harman/Kardon® audio system, making it a great choice for road trips.

Ford Mustang
There are few vehicles as iconic as the Ford Mustang, and whether you choose the Coupe (also referred to as Fastback) or Convertible, summer is always better with a sports car. Starting with the 2017 Mustang Fastback (MSRP $25,185), you get a 300 hp V6 with the Shelby GT350 cranking out a tremendous 526 hp. There are four engine choices. For those who want the open-air feeling of a convertible, the Mustang gives you the best of both worlds. “For the money, in the segment, nothing can touch it. Not even excuses,” says Autoblog about the Mustang. Available features include the SYNC infotainment system, Shaker Pro audio system and a navigation system.

Honda Ridgeline
A pickup may normally be associated with winter driving, but the 2017 Ridgeline (MSRP $29,475) isn’t your typical compact pickup. Currently sitting atop the U.S. News & World Report’s list of the best Compact Pickups, the Ridgeline has many features that set it apart from the competition and make it a great summer vehicle. A lockable in-bed trunk with drain plug can be used as a 7.3 cubic foot cooler, while the truck bed audio system and available 150-watt/400-watt trunk-bed outlets allow you to plug in a TV or other electronics, making it the ultimate party vehicle. “No matter how it’s outfitted, the Ridgeline is a no-brainer of a truck: unmatched in smoothness and comfort, and full of innovation well beyond its unibody construction,” Car and Driver writes. “It deserved far more sales than it netted in its inaugural generation. Here’s hoping this one realizes its full potential.”

Chrysler Pacifica
A minivan is a great vehicle for any family road trip and the new Pacifica ensures everyone will be comfortable and happy. It was recently named the Best New Family Car for 2017 by Cars.com. Some of the family-friendly features you’ll find are the available Uconnect Theater with 10.1-inch touchscreens and integrated games, and a 20-speaker Harman Kardon premium audio system. The Pacifica benefits from the convenience of Stow ’n Go and a class-exclusive Easy Tilt Seating that gives third-row passengers easier access to their seats. The Stow ’n Vac integrated vacuum helps clean up any messes that may happen along the way too. All Pacifica models are efficient, but you can also get a hybrid model—the only one in the segment—with a remarkable 84 MPGe rating.

Used with Permission. Published by IMN Bank Adviser Includes copyrighted material of IMakeNews, Inc. and its suppliers.

Do You Need a Co-signer for Your Auto Loan?

If you don’t have enough income or good enough credit, you may need a co-signer

As with any type of loan, your income and credit history will be major determinants of whether you are approved for an auto loan application. If you’ve been denied for an auto loan, you may want to consider using a co-signer.

Understanding how a lender determines loan approval
According to a January 2016 article in The Balance by author of “The Everything Improve Your Credit Book” Justin Pritchard, the lending company or financial institution must have reason to believe you will pay back the loan in order for you to be deemed worthy to receive the auto loan. A financial institution looks at two factors to determine whether you are credible: your credit score and your income.

Your credit history is a true indicator of how well you repay your loans; if you’ve borrowed money through loans previously and have successfully paid them off, or are making on-time payments, the lender will be more likely to believe you are a safe bet and will approve your loan application. On the other hand, if you have a poor credit score from defaulting on loan repayments, or don’t have any borrowing history, the financial institution may not want to approve you for a loan, explains Pritchard. To the financial institution, such a person is a bad investment, as the likelihood of the financial institution being repaid decreases.

Lenders also consider the income of the individual in deciding on a loan application, says Pritchard. In fact, the financial institution often calculates a debt to income ratio to determine if you make enough income to cover the expense of the loan payment each month.

Larger vehicles are generally more expensive than smaller ones, but smaller cars can also be more costly depending on the make and the engine build. The price of the vehicle and its calculated monthly payments under a loan in comparison to your monthly income will determine whether you have a low enough debt to income ratio to afford the monthly payments.

When to bring in a co-signer on your auto loan
If you have poor or no credit history, or your debt to income ratio is deemed too high by the lender, you will likely not be approved for a loan. In essence, the financial institution has determined you are too risky and will likely struggle to repay the loan, so it is unwilling to work with you.

A co-signer can help you meet the income and credit score requirements of the financial institution, as the financial institution considers the added income and credit history of the co-signer to the loan terms, explains Pritchard.

“Co-signing happens when somebody promises to pay a loan for somebody else. This happens when a [financial institution] won’t approve a loan (or it won’t approve the original application, but it’s willing to lend if a co-signer is involved),” says Pritchard in an October 2016 article in The Balance.

To the financial institution, the co-signer acts as a backup plan to collect payment if you default on the loan repayment. And if the co-signer has good credit history, the financial institution knows that at least one person on the loan has experience borrowing and repaying loans on time, adds Pritchard.

“The co-signer (who presumably has strong credit and income) promises to ensure that the loan gets repaid by signing the loan agreement with you. In other words, the cosigner takes full responsibility for the debt — if you don’t pay off the loan, your co-signer will have to do it.

“As a borrower,” Pritchard explains, “you need to have sufficient income and good credit to qualify for a loan. Using a co-signer therefore boosts your appeal as a borrower to the financial institution if you can’t meet the loan application requirements on your own.”

Used with Permission. Published by IMN Bank Adviser Includes copyrighted material of IMakeNews, Inc. and its suppliers.

Vehicle Details: Top Vehicles That Are Affordable and Cool

A cool ride doesn’t need to break the bank

There are so many choices if you’re looking for a new vehicle that it can be difficult to know where to start. But if your priorities are on coolness and affordability, here are some great options.

Kia Soul – The Soul is frequently awarded for its value and coolness, and the new 2017 model starts at an MSRP of $15,990 while delivering the same charm that has won over many buyers. The Soul continues to find ways to improve, with the newest model adding a turbocharged 1.6-liter four-cylinder engine that produces 201 hp and 195 lb/ft of torque through a seven-speed dual clutch transmission, and estimated fuel ratings up to 26 mpg city and 31 mpg highway. The Soul is easily spotted in a crowd thanks to its unique design, and some of its impressive features include the UVO infotainment system with eight-inch touchscreen display, navigation, and Apple CarPlay or Android Auto connectivity. You can also add a Harman Kardon audio system, ventilated front seats, heated rear seats, a heated steering wheel, and plenty of advanced safety features like the Blind Spot Detection System, Lane Departure Warning System, Forward Collision Warning System and Rear-Cross Traffic Alert.

Consumer Guide summarizes it nicely: “The competitively priced Soul is a very compelling mix of personality and practicality.”

Honda Fit – Named to Kelley2017_fit_yellow Blue Book’s KBB.com’s “10 Coolest Cars Under $18,000,” and currently ranked as the No. 1 subcompact and hatchback by U.S. News & World Report, the Fit has plenty to love. All Fit models have a 130 hp 1.5-liter four-cylinder engine that gets up to 37 mpg highway, but the versatility of the Fit is arguably its biggest strength. A maximum cargo capacity of 52.7 cubic feet is more expected from a small SUV, and clever features like the second row Magic Seat allow buyers to haul larger items. There are also plenty of standard features including Bluetooth wireless connectivity, a multi-angle rearview camera and a five-inch color LCD touchscreen.

Edmunds adds, “If there’s one thing this Honda is known for, after all, it’s the incredible amount of stuff you can fit inside its pint-sized hatchback body. Today’s Fit also has more rear legroom than ever, and it’s got a respectable roster of standard and optional technology too.”

Chevrolet Sonic – Also named tofebruaryfeatured_coolcars Kelley Blue Book’s KBB.com’s “10 Coolest Cars Under $18,000,” the 2017 Sonic is an affordable compact that offers excellent value (a starting MSRP of $15,145), two engines (a 1.8-liter four-cylinder and a turbocharged 1.4-liter four-cylinder) and plenty of technology, including a new Chevrolet MyLink infotainment system bundled with Apple CarPlay and Android Auto compatibility as well as OnStar 4G LTE with Wi-Fi hotspot. Safety is provided by 10 standard airbags and you can also add Lane Departure Warning, Forward Collision Warning and the new Rear Park Assist.

Autotrader says, “If you’re in the market for an affordable pint-sized champ that won’t make you feel second class for driving it, the Chevrolet Sonic may have your number.”

Other vehicles to consider include the Toyota Yaris iA, Honda Civic, MAZDA3 sedan and hatchback, Nissan Versa Note, Hyundai Elantra and Kia Rio.

Used with Permission. Published by IMN Bank Adviser Includes copyrighted material of IMakeNews, Inc. and its suppliers.

Questions You Should Ask the Dealer When Car Shopping

Five answers to know before you sign on the dotted line

No matter whetherfebruaryfeatured_dealerquesitons you are shopping for a new or used vehicle, there are certain questions you will always want to know the answers to. The answers the dealer provides will tell you whether you are getting the most car for your money.

What are the additional fees?
Legitimate costs include sales tax, registry costs and a documentation fee. However, the amount dealers charge for filling out the contract (the doc fee) is not universal. According to the trusted automotive resource Edmunds.com, some states regulate these fees and cap them below $100, so before you seal any deals, check the paperwork and negotiate down an outrageous doc fee. Another questionable fee you may encounter, in an effort for the dealer to build a potential profit back into the deal, is a “vehicle preparation fee.” This means, for example, they are charging you for making sure there is oil in the vehicle and for performing other menial tasks that one would expect to be done inevitably before a car is rolled off the lot.

Are there any aftermarket parts on the vehicle?
Inclusion of “add-ons”-from things as simple as tinted windows to things as complicated as car alarms-is another way dealers attempt to boost profits by raising prices.

“Mud flaps, rust-proofing and paint sealants make the dealer a lot of money, but you can get them for less-often much less-elsewhere,” writes David Muhlbaum, online editor of Kiplinger.com

Before saying yes to a vehicle purchase, you will want to double-check with the dealer and in the contract, and negotiate accordingly.

What special promotions are you running right now?
Manufacturers are always running sales events, and sometimes dealerships even tack on their own discounts and deals. Investigate up front what promos are going on so you can take a closer look at the vehicles with the best incentives.

“If you’re diligent-and a little bit lucky-you can use one of these events to knock a few thousand dollars off of your total cost or secure 0 percent APR financing for the first year or so of your loan,” says Business Insider personal finance writer Ben DeMeter in an article on Investopedia.

What is the lowest price you can give me?
Instead of telling the auto dealer the highest price you can afford to pay each month, take the reins by figuring out the lowest possible price you would pay on the vehicle in question. While it is smart to go into negotiations with financing options already lined up, the dealer may be able to offer you lower financing, so don’t show your cards too soon.

Can I see an accident history report and title history?
Most dealers these days automatically provide a CARFAX report for all vehicles, as well as an AutoCheck report to be thorough. These documents also report title history, which will disclose any previous problems with the vehicle such as odometer issues, a rebuilt engine or whether it was ever reported stolen. If you choose to proceed without checking one or both of these reports, or something like them, you are putting yourself at risk for a large devaluation of the vehicle.

Once you ask these questions and are satisfied with the responses provided, you can feel comfortable signing on the dotted line as an informed consumer.

Used with Permission. Published by IMN Bank Adviser Includes copyrighted material of IMakeNews, Inc. and its suppliers.

Is an Electric Vehicle Right for You?

The pros and cons of owning an EV
If you’re considering167427226 a new ride, you owe it to yourself to check out an electric vehicle (EV). Here are some of the pros and cons of owning one.

Electric vehicles have come a long way in a short amount of time and can eliminate the need for gas. With significantly fewer parts than traditional gas-powered engines, EVs require significantly less maintenance too. EVs have zero tailpipe emissions, so they enable you to do your part in helping the environment.

Many people believe that EVs don’t offer the range that they need in terms of miles they can drive on a single charge, but that’s simply not the case. According to the United States Department of Transportation Federal Highway Administration, the average American commutes fewer than 40 miles per day. Most EVs get far more than that.

Here are a few examples.

Nissan Leaf
The Leaf starts at an MSRP of $29,010 and offers 107 miles of range when equipped with the 30-kWh battery. Standard features include Nissan Intelligent Key with push-button start, Bluetooth wireless connectivity and heated front seats. You can also add the NissanConnect system with Navigation, a Bose audio system and leather upholstery. If you download the LEAF EZ-Charge app, you can locate over 20,000 charging stations nationwide so you’ll never be worried about running out of power.

“While it has a limited driving range, in most other respects the Leaf is quite similar to a conventional gas-powered compact hatchback, offering a comfortable interior and surprisingly snappy acceleration (albeit with zero emissions),” says LeftLane News.

Tesla Model S
The Model S has revolutionized the way people look at EVs. It’s not as much of a great luxury EV as it is a great luxury vehicle that happens to be electric, which was designed to be safer and more exhilarating than anything else on the road. It also offers electric all-wheel drive, autonomous driving features and technology that make it the envy of its peers. Driving range starts at up to 218 miles per charge in base form and can go all the way up to 315 miles. This is impressive in its own right, but even more so when you consider the Model S can go from zero to 60 mph in as little as 2.5 seconds.

Kelley Blue Book says that the “Tesla’s Model S for 2016 is a game changer, offering everything a traditional combustion-engine luxury sedan does without the harmful emissions and unpredictable fuel bills. . [T]he Model S can win over the most skeptical enthusiast.”

Mitsubishi i-MiEV
An MSRP of $22,995 gets you into a new 2017 i-MiEV, and after the federal tax credit of $7,500, the i-MiEV comes in at an impressively affordable $15,495. That’s significantly cheaper than popular models like the Toyota Corolla, Honda Civic, Chevrolet Cruze and Ford Focus. Its 60-mile driving range may not be as impressive as that of the other models mentioned, but it allows for fuel-free driving for less than many traditional gas-powered vehicles cost, making the i-MiEV a great second vehicle for people who don’t tend to travel very far.

Other options: You can find electric versions of popular models, including the Kia Soul, Volkswagen Golf, Chevrolet Spark and Ford Focus.

The Drawbacks
While there are many advantages of owning an EV, there are still some factors some people can’t overcome. The architecture of the grid is improving, but if you’re looking to travel long distances, many EVs aren’t ideal because of their long charging times and limited ranges. Another factor can be price, which puts a lot of buyers out in the first place. And if you’re looking for variety, many manufacturers don’t even offer an EV in the first place.

Regardless of what you’re looking for, your financial institution is arguably the best place to get financing, so stop by and let us know what you’re looking for, and we’ll do our best to get you the money you need so you have one less thing to worry about.

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Understanding Lease Terminology

Motor vehicle financing terms to know before going to the dealership

Before steppingleaseterms_featured into a dealership to lease a car, it’s important to understand lease terminology to make sure you get the best deal possible and aren’t taken advantage of by a dealer.

Understanding the basics
Cars are often advertised with much lower payments for leases than for purchases. According to a February 2012 article from J.D. Power and Associates contributed by Jeff Youngs, this is because lease payments are based on the depreciation value of the vehicle during the contracted term of operation.

There are, however, additional terms and fees on top of the monthly lease payment. Some—like mileage allowance, purchasing options after the lease term ends and depreciation of the vehicle—are widely known, while others are not.

The following are those you should know that might fall in the latter category:

Acquisition/termination fee
Also known as the bank fee, this covers administration costs and is paid either at the beginning of the lease (acquisition) or at the end (termination), according to Youngs.

Capitalized cost
This is the negotiated total cost of the vehicle. “When leasing a model that is in high demand and low supply, the capitalized cost may be the Manufacturer’s Suggested Retail Price (MSRP) or higher,” Youngs said in an April 2013 article from J.D. Power and Associates.

Capitalized reduction payment
Also known as the cap-reduction payment, this is the down payment made on a lease term to help reduce the monthly payment amounts. It is nonrefundable, Youngs said.

Destination charge
This is the nonrefundable cost for the vehicle to be delivered to the dealership.

Drive-off fee
This is the total amount due at signing. Just as when purchasing a car, there will be title fees, registration fees and sales tax to account for, though leased vehicles incur sales tax on monthly payments only, said Tony Quiroga, Car and Driver magazine senior editor, in a February 2015 article.

Money factor
Also known as the finance factor or finance charge, this number is used to calculate your interest rate by multiplying the money factor by 2,400, Young said. For example, a money factor of .00350 would be an 8.4 percent interest rate.

Rent charge
“This is the amount of the lease payment that comes from interest charges,” Quiroga explained. “To calculate the rent charge, add the adjusted cap cost to the depreciation and multiply by the finance factor,” and then multiply by the total number of months in the lease term.

Residual value
According to Youngs, this is the “predicted value of the vehicle at the end of the lease.” Quiroga pointed out that with residual value, “the less it’s worth, the higher the lease payments.”

Subsidized lease
“Many advertised lease deals are subsidized leases, meaning that the auto manufacturer determines, in advance, the financial variables used to calculate the lease payment and takes on a certain degree of risk in order to create an attractive or class-competitive payment,” Youngs warned. He added that subsidized lease terms are nonnegotiable and often require a cap-reduction payment.

Additional lease information
There are a few other details to note in regard to leasing, depending on the vehicle you choose and any additional services you purchase.

Gap insurance is often included in lease terms as an additional fee. According to Youngs, this automotive insurance helps meet the gap between your insurer’s paid amount and the total residual value due to the leasing company in the even that your vehicle is stolen or damaged beyond repair.

A service contract is also offered as part of a lease contract, in which the consumer agrees to pay a discounted price up front to the dealership to have the vehicle serviced by the dealership for all of its future repair and maintenance needs.

“Before buying a service contract, make sure the brand of vehicle selected does not offer free scheduled maintenance for a limited time,” Youngs said.

Finally, it’s important to note that your base monthly payment is not the total amount you have to pay each month within a lease. The base monthly payment is simply the depreciation value plus the rent charged, divided by the number of months in the lease term. Your total monthly payment—what you actually pay each month—is the base payment plus tax.

Used with Permission. Published by IMN Bank Adviser Includes copyrighted material of IMakeNews, Inc. and its suppliers.

How Autonomous Driving Will Change the Auto Industry

Autonomous vehicles will bring major changes across the mainstream auto industry

With autonomous drivingautonomouscars technology already in use, experts predict it won’t be long until autonomous vehicles (AVs) are available to the mainstream, bringing with them significant changes to the auto industry.

How Automakers Will Respond
Although AVs are not available for consumer purchase, automakers should get ready for strategic response in the near future. In fact, according to a June 2015 article from worldwide business management consulting firm McKinsey & Company, AVs are already being used for mining and farming and could soon be seen in construction.

McKinsey interviewed 30 experts worldwide about the implications of Advanced Driver-Assistance Systems (ADAS) and AVs for the auto industry. Using this research, McKinsey established four main responses likely to come from automakers:

  • Gradual incorporation of technology – “Established premium players with extensive customer bases and strong technical and commercial legacies will probably take an incremental approach to AVs.”
  • Adoption specific to the needs of the accessible mobility market – “New industry players developing ‘radically new’ vehicle architectures [will tap into the handicapped accessibility market and] capture volumes quickly and sustain ancillary business models.”
  • Early adoption overall – Automakers with “significant technical and commercial legacies … will most likely invest in AV research and then wait for the vehicle-level costs of the core technologies to drop while penetration in the premium segments grows.”
  • Opposition to the technology – These will be the automakers that will most likely avoid entering the AV market until the later years of development.

Changing the Market for Automakers and Financing Needs
Regardless of how manufacturers respond, there will be a definite change in the market for automakers.

In its report, McKinsey posits that once the AVs begin to enter the market in the early adoption phase, automakers and manufacturers could take advantage of the need for original service equipment and car parts. Instead of producing new car models, these companies would change their business focus to serving, repairing and maintaining AVs.

“Our research shows that nearly 60 percent of customers would follow their smart cars’ recommendations for service locations. Beyond the benefits of a bigger after-sales revenue stream, OEMs will have a strong incentive to service these vehicles, since regulators could ultimately force them to take on the greatest portion of the responsibility and risk associated with crashes caused by AV technical failures,” reports McKinsey.

This could lead to a change in the supply chain and in manufacturing employment as AVs enter the manufacturing industry, with both positive and negative effects.

“AVs in combination with smart technologies could reduce labor costs while boosting equipment and facility productivity” but would decrease employment in this sector as AVs take over jobs once performed by humans, says McKinsey.

It could also change whether consumers will still need financing for vehicle purchases.

In a February 2016 article in Road & Track, automotive industry expert Bob Lutz poses some very tough predictions for the auto industry and the need for vehicle financing.

“When we really get to the point where we have individually programmable but standardized transportation modules moving on the freeway with a whole snake of vehicles at 150 mph, brands will no longer matter,” states Lutz.

It’s possible that some consumers will still opt to own AVs, which will not kill off the automotive industry altogether, but there are still large implications for ownership decline, automotive sales and financing needs. Lutz predicts this change will occur first in urban areas, where car ownership has been declining and people are already groomed for AV use.

“We see, basically, this model in the form of Uber. Uber is simply autonomous vehicles with a driver,” Lutz says.

Implications for Non-Automated Vehicles
Lutz compares the change over from non-automated vehicles to AVs to an earlier change in transportation history, from horses and carriages to the first car. Lutz poses that regular vehicles will become relics of entertainment and status, kept purely for personal enjoyment.

“Consider the horse. With the advent of the car, horses were essentially banned from streets,” he says. “But they made a very nice comeback on private property. Dude ranches, farms, riding stables, racing. I think the same thing can and will happen to the automobile.”

If this is the case, financing for a non-automated vehicle will certainly change and may even become a much more inclusive buying process across the credit score spectrum.

If you have any queries, ask us about financing and we’ll be happy to talk to you about possible changes and what to do today.

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