My husband was in an accident with our family’s van so we have to buy a new one. The insurance is paying off our existing note in full. We have found a pre-owned van that we want to purchase as a replacement and we are considering how we should pay for it.
We know dealerships (this vehicle will be purchased from a dealer) HATE cash purchases. We’ve been flat out denied service before when we took out our check book. Plus, we aren’t comfortable taking that much of a hit to our savings right now. So, we won’t be purchasing outright.
The option we’re contemplating is for one of us purchase the van with our high limit travel rewards credit card, for which we’d get 2miles per $. Then, in order to avoid interest, the other spouse would “buy” the van with a traditional auto loan from our credit union from the spouse as a “private seller.” In our perfect little scenario, we’d get the miles, the van, and a monthly payment/interest rate we can afford. Our goal is a much needed vacation. It’s been a tough year (which is only half over.)
Does anyone see any pitfalls we don’t? Is it likely the credit union (or any lender) will permit this? My husband and I both have excellent credit (800+), about equal income, and little debt besides our home (mortgage + HELOC, HELOC is paid off, mortgage is ahead of schedule.) We realize that this might be an unheard of option because it isn’t feasible. But we’re hoping that it’s unheard of because it isn’t feasible for most people...our financial situation being better than all our peers, and our parents, we only ever hear about traditional lending scenarios (ie just take on more debt). Thanks in advance for folk’s input.
We will most likely be getting a settlement from the insurance company since my husband was not at fault, which we will use primarily to pay for the van, but, 1) we need the vehicle now, and insurance claims take months to settle; and 2) we never count our chicks before they hatch, so to say. We only do/buy things we can afford now. Worst case scenario is we make payments the life of the loan, best case is we pay it off w/insurance money.