HOW WOULD A BALLOON LOAN WORK ON A F8 ?

Balloon loans almost never are good
Unless you’re planning on flipping the car. Which Ferrari frowns on.


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A loan on 300k would cost 5k a month roughly. And after 3 years you probably would still owe about 250k.

 

Assume the loan is at 6% and the balloon payment is year three with a 10 year amortization period, you would have a $3331 monthly payment and owe $228K after three years. Unless you put a lot of miles on the car, it would be worth more.

 

I did not do a 10 year loan in my calculations. I used a shorter term for the loan hence my 5k a month payment.

 

Then at the end of 5 years hope the car appreciates so you can pay the balance


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I think those balloon deals use a 10 year amortization period. But I've never done one so I could be wrong.

Edit: I also think the balloon is generally at 60 months, not 36. But you can of course pay it off any time.

 

Also, we're forgetting sales tax and title. Depending on your jurisdiction that could add as much as another $30K.

 

Forget about the car appreciating in 3 years.
They never do unless there a limited edition.
Be prepared to lose a lot of money plus pay a lot more for the car with that balloon loan.
In my opinion if you can’t afford to make a very substantial down payment then don’t buy it.

 

In California, $30k would only cover the sales tax.

 

Poorly. It would work poorly.

Unless you're a floorplanning dealer.

Matt

 

Speciale is not a limited edition and it is still selling over invoice for low mileage and decent specs.


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F8 is no Speciale. And dare I say it? The Pista is no Speciale.

 

At least in Europe Speciale are very close (if not slightly under) initial prices - so what it means is that the owner gets his money back if he refrained to use (and really enjoy) it.
That's very good compared to other cars but nowhere near making money.
Financing has always an additional cost so usually it's better avoiding it...
Since one gets the best rates on real estate, it's better financing that (even if not needing) and keep the cash for cars.

 

Are you trying to lease or finance the car?
If lease, contact Putnam or Premier and ask them for a quote breakdown, which will include a balloon (residual) and an amortization schedule.
They can email this to you instantly.
Also if leasing, you won’t pay the whole sales tax.


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Correct , and after three years this is what’s gonna happen. Best ,Kirk.

 

how so? 60 payments at 5k a month is 300K - loan wld be paid off no?

 

Call me crazy, but what's wrong with just a normal car loan at currently low interest rates? LOL.

 

yeh exactly

 

Probably a large downstroke. Less for a lease ? I’m just guessing.

 

I was just doing quick back of the napkin math and assuming a large chunk of your initial payments would be paying off interest and not principle.

 

Go buy a beautiful well-cared for 458 Italia, that is likely more your price point and much smarter move.
458 Italia near bottom of depreciation curve...years of thrilling happy motoring, and fewer financial headaches.

 

mmmh - there is a finite amount of interest in 60 month loans...interest is really only a big factor on 30 yr amortized mortgages...even a 15 yr mortgage is 50% principal and 50% interest from day 1.
anyhow if your gonna borrow money for a new car id do a regular loan or lease payments if you are comfortable writing that expense off to ur business. otherwise, just finance it the old fashioned way.

 

I don’t disagree. And yes, you are probably right that amortization is more of an issue with home mortgages.

Either way I agree with you and would never do a balloon loan. Just buy a car you can afford.

 

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