2023 Lexus GX Finance or Cash

[broncocountry25]

Looking at a 23 Lexus GX this weekend.

They are offering 2.5% financing for up to 48 months. We have the cash to pay it but I think I will do something like 20K down and then pay the remainder @ 2.5% off over 4 years.

Anyone else recently take advantage of this sort of financing on Lexus or another vehicle?

[Jack FFR1846]

2 comments.

1) When you tell a dealer "I'm paying cash", that tells them "Raise the price $1000 because we're not getting the finance company kickback". So taking the Lexus financing is a good idea.

2) It's pretty easy to find interest rates over 5%. Redneck Bank has a megamoney account that pays 5.05% up to $100k so by taking the loan, you're making money on the difference minus tax on the interest.

[lazydavid]

I would take the 2.5% and leave my money in a HYSA earning 5%. Win win.

[whodidntante]

Take the financing if you're going to buy this car either way. A better decision financially would be to buy no car or a much less expensive car. Unless you're rich.

[Hyperchicken]

At 2.5% interest rate, I know I would put as little down as I can, ideally $0 down, and take the longest loan term offered to me.

[Random Poster]

If you finance a vehicle, are you required to have a certain level or type(s) of insurance coverage?

If so, and if you wouldn’t carry that level or type(s) of insurance coverage if the vehicle was paid off, then I suppose that you should add the extra insurance cost into the calculation of whether financing makes sense.

[FrugalConservative]

When we bought our 23' GX460 back in August the dealer didn't care if we financed or paid cash, made zero difference in price.

[Jack FFR1846]

When we bought our 23' GX460 back in August the dealer didn't care if we financed or paid cash, made zero difference in price.

Of course they don't care. The next guy came in and used the dealer's financing and got $1000 off the price of the car. The dealer still didn't care. He got the same money either way.

[lazydavid]

If you finance a vehicle, are you required to have a certain level or type(s) of insurance coverage?

If so, and if you wouldn’t carry that level or type(s) of insurance coverage if the vehicle was paid off, then I suppose that you should add the extra insurance cost into the calculation of whether financing makes sense.

I don't know that omitting collision and comprehensive insurance on a brand new $65k car is a financially savvy move, regardless of whether you're carrying a loan on it.

Being willing to eat a $5k loss in the event something happens is a very different mindset than doing the same on something 13x the value.

[broncocountry25]

Take the financing if you're going to buy this car either way. A better decision financially would be to buy no car or a much less expensive car. Unless you're rich.

Time for an upgrade and am ok with sacrificing some money to do it. Should be a solid car for the long term and used prices are pretty high. We bought certified pre owned pre covid but think we will go new.

Not sure what "rich" is these days but we are 33 with $1.5M NW and plan to continue working going forward.

[broncocountry25]

If you finance a vehicle, are you required to have a certain level or type(s) of insurance coverage?

If so, and if you wouldn’t carry that level or type(s) of insurance coverage if the vehicle was paid off, then I suppose that you should add the extra insurance cost into the calculation of whether financing makes sense.

We already have top insurance with an umbrella policy requiring to do so and would want to keep top insurance.

[whodidntante]

Take the financing if you're going to buy this car either way. A better decision financially would be to buy no car or a much less expensive car. Unless you're rich.

Time for an upgrade and am ok with sacrificing some money to do it. Should be a solid car for the long term and used prices are pretty high. We bought certified pre owned pre covid but think we will go new.

Not sure what "rich" is these days but we are 33 with $1.5M NW and plan to continue working going forward.

You are rich. Go ahead.

At some point I realized that when other people were talking about "the rich" they actually meant me.

[broncocountry25]

Take the financing if you're going to buy this car either way. A better decision financially would be to buy no car or a much less expensive car. Unless you're rich.

Time for an upgrade and am ok with sacrificing some money to do it. Should be a solid car for the long term and used prices are pretty high. We bought certified pre owned pre covid but think we will go new.

Not sure what "rich" is these days but we are 33 with $1.5M NW and plan to continue working going forward.

You are rich. Go ahead.

At some point I realized that when other people were talking about "the rich" they actually meant me.

We feel well off for sure and grateful for our current set up. It is very hard to draw a line though and feel "rich". We know many with much much more then us. One of my lifelong friends is 4th generation in a family business. They buy new Range Rovers every three years through the company. Really hard to relate to that.

We work hard, earn, and save. We know we have to continue working but want to enjoy along the way. This will be the first new car I have ever purchased.

[whodidntante]

Take the financing if you're going to buy this car either way. A better decision financially would be to buy no car or a much less expensive car. Unless you're rich.

Time for an upgrade and am ok with sacrificing some money to do it. Should be a solid car for the long term and used prices are pretty high. We bought certified pre owned pre covid but think we will go new.

Not sure what "rich" is these days but we are 33 with $1.5M NW and plan to continue working going forward.

You are rich. Go ahead.

At some point I realized that when other people were talking about "the rich" they actually meant me.

We feel well off for sure and grateful for our current set up. It is very hard to draw a line though and feel "rich". We know many with much much more then us. One of my lifelong friends is 4th generation in a family business. They buy new Range Rovers every three years through the company. Really hard to relate to that.

We work hard, earn, and save. We know we have to continue working but want to enjoy along the way. This will be the first new car I have ever purchased.

An abundance of money offers freedom and empowerment in some ways. That's exactly where you are.

I drove hoopties for many years before buying my first new car seven years ago. It cost 39k and I still have it. The same car now might cost 58k. I consider that lavish because it's more than I spend in an entire year if I exclude taxes and imputed rent from the house I own. And I live well. I do not clearly recall my net worth at the time, but I remember thinking that lighting 39k on fire was more than fine.

[02nz]

When you tell a dealer "I'm paying cash", that tells them "Raise the price $1000 because we're not getting the finance company kickback". So taking the Lexus financing is a good idea.

This is a gross oversimplification. There are a lot of different finance deals. Generally, when there's a below-market finance rate, it's because the manufacturer's finance arm is subsidizing it. Often they'll offer a cash incentive in lieu of it. That's the case here - I'm seeing a $2000 cash incentive that cannot be combined with the finance offer, and so that needs to be taken into account to figure out the real cost of the 2.5% financing.

[PharmerBrown]

If you finance a vehicle, are you required to have a certain level or type(s) of insurance coverage?

If so, and if you wouldn’t carry that level or type(s) of insurance coverage if the vehicle was paid off, then I suppose that you should add the extra insurance cost into the calculation of whether financing makes sense.

I don't know that omitting collision and comprehensive insurance on a brand new $65k car is a financially savvy move, regardless of whether you're carrying a loan on it.

Being willing to eat a $5k loss in the event something happens is a very different mindset than doing the same on something 13x the value.

The insurance companies seem to do just fine taking that bet.

[BruDude]

Are they offering a cash rebate if you don’t take the 2.5%?

[lazydavid]

If you finance a vehicle, are you required to have a certain level or type(s) of insurance coverage?

If so, and if you wouldn’t carry that level or type(s) of insurance coverage if the vehicle was paid off, then I suppose that you should add the extra insurance cost into the calculation of whether financing makes sense.

I don't know that omitting collision and comprehensive insurance on a brand new $65k car is a financially savvy move, regardless of whether you're carrying a loan on it.

Being willing to eat a $5k loss in the event something happens is a very different mindset than doing the same on something 13x the value.

The insurance companies seem to do just fine taking that bet.

I don't care if it's a smart thing for the insurance company. Insurance companies are not individuals. They get to spread their risk over millions of customers. You just have you.

If you have tens or hundreds of billions of dollars and millions of cars, it probably is smarter not to insure them.

[PharmerBrown]

If you finance a vehicle, are you required to have a certain level or type(s) of insurance coverage?

If so, and if you wouldn’t carry that level or type(s) of insurance coverage if the vehicle was paid off, then I suppose that you should add the extra insurance cost into the calculation of whether financing makes sense.

I don't know that omitting collision and comprehensive insurance on a brand new $65k car is a financially savvy move, regardless of whether you're carrying a loan on it.

Being willing to eat a $5k loss in the event something happens is a very different mindset than doing the same on something 13x the value.

The insurance companies seem to do just fine taking that bet.

I don't care if it's a smart thing for the insurance company. Insurance companies are not individuals. They get to spread their risk over millions of customers. You just have you.

If you have tens or hundreds of billions of dollars and millions of cars, it probably is smarter not to insure them.

It's still financially savvy to self insure if you can afford to. There may be more downside risk when you shrink the pool to an individual, but there's also more upside. It's people like those that visit this board, that help make insurance affordable for those that wouldn't be insurable otherwise.

[JackoC]

If you finance a vehicle, are you required to have a certain level or type(s) of insurance coverage?

If so, and if you wouldn’t carry that level or type(s) of insurance coverage if the vehicle was paid off, then I suppose that you should add the extra insurance cost into the calculation of whether financing makes sense.

I don't know that omitting collision and comprehensive insurance on a brand new $65k car is a financially savvy move, regardless of whether you're carrying a loan on it.

Being willing to eat a $5k loss in the event something happens is a very different mindset than doing the same on something 13x the value.

The insurance companies seem to do just fine taking that bet.

I don't care if it's a smart thing for the insurance company. Insurance companies are not individuals. They get to spread their risk over millions of customers. You just have you.

If you have tens or hundreds of billions of dollars and millions of cars, it probably is smarter not to insure them.

It's financially 'smart' in pure non-emotional terms to self insure if you can easily afford to absorb an uninsured loss. Even 'purely non-emotionally' there's room for debate defining 'easily afford' but a reasonable definition is nothing like billions in wealth.

Realistically though it feels terrible to have uninsured loss on a nice new car. Even if over a whole car buying lifetime you're very likely to come out ahead skipping comp/coll if a total loss wouldn't seriously upset your financial situation. And that must be very likely or insurance co's couldn't exist, incurring costs to process claims, advertise etc, pay out claims and still making a profit.

I've kept comp/coll on new cars for a few years. But back to feelings v strict $'s, I put $2k deductible on comp/coll on recent $82k car. It got a small dent/scratches after a little more than 1yr, but 'we'd have to paint both doors, we'll probably break the molding preparing them...' etc. I'd be looking at close to the $2k at least for a 100% repair. I admit I had second thoughts about not going with $500 deductible, it's natural (I DIY repaired which I'm not terrible at, it's not obvious now and arguably again 'behaviorally' there's even an advantage to an expensive new car becoming less than perfect so I stop obsessing about keeping it perfect).

[mggray17]

Yes, bought a new truck in July. Had the cash to buy it outright, but they offered 0.9% for 36 months. Put 25% down, financed 75% of the purchase price. The original amount I put away for this purchase is still in 6 month T-bills. It was a no brainer for me.

[pizzy]

Yes, bought a new truck in July. Had the cash to buy it outright, but they offered 0.9% for 36 months. Put 25% down, financed 75% of the purchase price. The original amount I put away for this purchase is still in 6 month T-bills. It was a no brainer for me.

Why did you decide to put 25% down?

[bberris]

Dealers get a commission from the bank for arranging financing. But their main reason to like people who finance is that it makes the profitable addons easier for the mark to swallow.

[broncocountry25]

Pulled the trigger and purchased today!

First new car of my life. Really love the car got the exact model I wanted and will be very happy if I keep it for a decade!

I have such a hard time spending money sometimes and am really happy I did this.

Ended up doing the financing and going to move the cash to a HYSA/Money Market and set up auto pay. Took them up on the 48 months @ 2.5% offered by Lexus.

The sound system rocks and it is so comfortable! Thanks to those who weighed in

[pizzy]

Pulled the trigger and purchased today!

First new car of my life. Really love the car got the exact model I wanted and will be very happy if I keep it for a decade!

I have such a hard time spending money sometimes and am really happy I did this.

Ended up doing the financing and going to move the cash to a HYSA/Money Market and set up auto pay. Took them up on the 48 months @ 2.5% offered by Lexus.

The sound system rocks and it is so comfortable! Thanks to those who weighed in

Care to share final numbers?

[Elysium]

Looking at a 23 Lexus GX this weekend.

They are offering 2.5% financing for up to 48 months. We have the cash to pay it but I think I will do something like 20K down and then pay the remainder @ 2.5% off over 4 years.

Anyone else recently take advantage of this sort of financing on Lexus or another vehicle?

Not addressing the financing question, that seems to have been answered.

Did you know they are redesigning the GX for 2024 completely, body styling is different and so are some of the interiors. It's a much nicer look, and given the GX has long cycles between upgrades, this is something that will last for a long time. But the 2023 model is long on the tooth and will look outdated right away.

new GX

[watchnerd]

Looking at a 23 Lexus GX this weekend.

They are offering 2.5% financing for up to 48 months. We have the cash to pay it but I think I will do something like 20K down and then pay the remainder @ 2.5% off over 4 years.

Anyone else recently take advantage of this sort of financing on Lexus or another vehicle?

Not addressing the financing question, that seems to have been answered.

Did you know they are redesigning the GX for 2024 completely, body styling is different and so are some of the interiors. It's a much nicer look, and given the GX has long cycles between upgrades, this is something that will last for a long time. But the 2023 model is long on the tooth and will look outdated right away.

new GX

Came here to say this.

Boxy SUVs are in.

Egg-shaped SUVs are out.

Current GX will look dated soon.

[Elysium]

Looking at a 23 Lexus GX this weekend.

They are offering 2.5% financing for up to 48 months. We have the cash to pay it but I think I will do something like 20K down and then pay the remainder @ 2.5% off over 4 years.

Anyone else recently take advantage of this sort of financing on Lexus or another vehicle?

Not addressing the financing question, that seems to have been answered.

Did you know they are redesigning the GX for 2024 completely, body styling is different and so are some of the interiors. It's a much nicer look, and given the GX has long cycles between upgrades, this is something that will last for a long time. But the 2023 model is long on the tooth and will look outdated right away.

new GX

Came here to say this.

Boxy SUVs are in.

Egg-shaped SUVs are out.

Current GX will look dated soon.

Plus the dreaded barn door is out in the rear, with a new lift gate open, and the engine gets an update too, the V8 is out instead V6 with twin turbo. I'd definitely buy the 2024 if I were going to buy a GX in a flash and ignore any deals on the old model. These SUVs are keepers and best to ignore short term deals.

[receo-vs]

Pulled the trigger and purchased today!

First new car of my life. Really love the car got the exact model I wanted and will be very happy if I keep it for a decade!

I have such a hard time spending money sometimes and am really happy I did this.

Ended up doing the financing and going to move the cash to a HYSA/Money Market and set up auto pay. Took them up on the 48 months @ 2.5% offered by Lexus.

The sound system rocks and it is so comfortable! Thanks to those who weighed in

Care to share final numbers?

Second this request; with the addition of the trim. The GX is on my short list for my next car purchase.

[watchnerd]

Plus the dreaded barn door is out in the rear, with a new lift gate open, and the engine gets an update too, the V8 is out instead V6 with twin turbo. I'd definitely buy the 2024 if I were going to buy a GX in a flash and ignore any deals on the old model. These SUVs are keepers and best to ignore short term deals.

The 2024 also has a ladder on frame construction.

[Hyperchicken]

I love how everyone waited for OP to buy the car to post about the upcoming redesign.

[watchnerd]

I love how everyone waited for OP to buy the car to post about the upcoming redesign.

Some states have a 'cooling off period' window during which one can reverse the decision.

[vfinx]

Congrats OP. I see one of these in the school pickup line as I walk my kid home. It certainly has a lot of presence.

[Elysium]

I love how everyone waited for OP to buy the car to post about the upcoming redesign.

OP pulled the trigger too soon. Threads take a life over a few days, didn't see it until now, so it pays to wait. May be OP already knew the re-design, though can't imagine any reason to forgo the new '24 model.

[Random Poster]

….though can't imagine any reason to forgo the new '24 model.

Some people have a prohibition against buying the first year of any new model.

And perhaps some people don’t want a turbo engine (or, in the case of the upcoming LandCruiser, a hybrid engine, and they prefer the V8. Or they don’t want all of the new technology that comes with newer models.

Or they think that the older model looks nicer than the newer one.

[watchnerd]

….though can't imagine any reason to forgo the new '24 model.

Some people have a prohibition against buying the first year of any new model.

And perhaps some people don’t want a turbo engine (or, in the case of the upcoming LandCruiser, a hybrid engine, and they prefer the V8. Or they don’t want all of the new technology that comes with newer models.

Or they think that the older model looks nicer than the newer one.

Modern software-controlled Turbo Direct Injection engines have so much more horsepower per liter, and improved fuel efficiency, I can only imagine preferring the V8 if you're going to tow a boat, horsetrailer, or something similar.

[vfinx]

I love how everyone waited for OP to buy the car to post about the upcoming redesign.

OP pulled the trigger too soon. Threads take a life over a few days, didn't see it until now, so it pays to wait. May be OP already knew the re-design, though can't imagine any reason to forgo the new '24 model.

Even Lexus is not immune to year-one bugs. That turbo 6 had some growing pains when it was first rolled out in the Tundra. I’m sure it’s ironed out now, but you just never know what could be lurking in total redesigns.

It also seems to me that Lexus is lowering their NVH bar in recent models. I wouldn’t be surprised if noise and comfort levels are worse in the new GX, similar to what they did with the redesigned RX and NX. That’s just my subjective take having done some test drives.

[Miriam2]

Plus the dreaded barn door is out in the rear . . .

I loved the back barn doors in my old 1999 Suburban Easier for me to pack & use.

The 2024 also has a ladder on frame construction.

What is this?

[watchnerd]

Plus the dreaded barn door is out in the rear . . .

I loved the back back doors in my old 1999 Suburban Easier for me to pack & use.

The 2024 also has a ladder on frame construction.

What is this?

It means it's built on a truck-type frame instead of a unibody car-type frame.

For heavy duty applications, ladder on frame is usually considered more durable, less prone to twisting, allowing more efficient transfer of torque, especially in 4WD scenarios.

https://en.wikipedia.org/wiki/Body-on-frame

[snackdog]

Be sure and check the comfort on bumpy roads. The current models are notorious for poor ride, uncomfortable seats (and terrible mpg). It is a somewhat dated platform. Have you checked alternatives?

[Miriam2]

The 2024 also has a ladder on frame construction.

What is this?

It means it's built on a truck-type frame instead of a unibody car-type frame.

For heavy duty applications, ladder on frame is usually considered more durable, less prone to twisting, allowing more efficient transfer of torque, especially in 4WD scenarios.

https://en.wikipedia.org/wiki/Body-on-frame

Very interesting, thank you for the link.

[whodidntante]

….though can't imagine any reason to forgo the new '24 model.

Some people have a prohibition against buying the first year of any new model.

And perhaps some people don’t want a turbo engine (or, in the case of the upcoming LandCruiser, a hybrid engine, and they prefer the V8. Or they don’t want all of the new technology that comes with newer models.

Or they think that the older model looks nicer than the newer one.

Modern software-controlled Turbo Direct Injection engines have so much more horsepower per liter, and improved fuel efficiency, I can only imagine preferring the V8 if you're going to tow a boat, horsetrailer, or something similar.

I'd be in favor of adding twin turbos to the V8. 700 HP is a nice starting point.

[stoptothink]

Looking at a 23 Lexus GX this weekend.

They are offering 2.5% financing for up to 48 months. We have the cash to pay it but I think I will do something like 20K down and then pay the remainder @ 2.5% off over 4 years.

Anyone else recently take advantage of this sort of financing on Lexus or another vehicle?

Not addressing the financing question, that seems to have been answered.

Did you know they are redesigning the GX for 2024 completely, body styling is different and so are some of the interiors. It's a much nicer look, and given the GX has long cycles between upgrades, this is something that will last for a long time. But the 2023 model is long on the tooth and will look outdated right away.

new GX

Came here to say this.

Boxy SUVs are in.

Egg-shaped SUVs are out.

Current GX will look dated soon.

Plus the dreaded barn door is out in the rear, with a new lift gate open, and the engine gets an update too, the V8 is out instead V6 with twin turbo. I'd definitely buy the 2024 if I were going to buy a GX in a flash and ignore any deals on the old model. These SUVs are keepers and best to ignore short term deals.

The '24 model looks so much nicer (although not digging the rims). Either way, congrats to OP, not my type of ride, but GX will go anywhere and are pretty much bulletproof.

[mggray17]

Yes, bought a new truck in July. Had the cash to buy it outright, but they offered 0.9% for 36 months. Put 25% down, financed 75% of the purchase price. The original amount I put away for this purchase is still in 6 month T-bills. It was a no brainer for me.

Why did you decide to put 25% down?

Just a personal decision. Had that amount in my checking account, and retained all of the cash that I already had in the T-bills without cashing them out. I also learned while sitting at the dealer that the deposit helped avoid "gap" insurance.

[pizzy]

Yes, bought a new truck in July. Had the cash to buy it outright, but they offered 0.9% for 36 months. Put 25% down, financed 75% of the purchase price. The original amount I put away for this purchase is still in 6 month T-bills. It was a no brainer for me.

Why did you decide to put 25% down?

Just a personal decision. Had that amount in my checking account, and retained all of the cash that I already had in the T-bills without cashing them out. I also learned while sitting at the dealer that the deposit helped avoid "gap" insurance.

Have you ever inquired with your auto insurance about how much they charge for gap insurance?

Ours was $6/year I think.

[pizzy]

Based on the link to the 2024 GX, I asked my wife if I can get the 2024 GX.

She said “do what you want, I don’t care” which means “NO”

So I’m stuck with my CRV.

[Cash is King]

I love how everyone waited for OP to buy the car to post about the upcoming redesign.

Some states have a 'cooling off period' window during which one can reverse the decision.

^ Is that applicable to automobile purchases ? I didn't think any state had a "cooling off period" for automobile purchases.

[watchnerd]

I'd be in favor of adding twin turbos to the V8. 700 HP is a nice starting point.

For off-roading, I'd actually prefer a twin turbo V6 to keep it from getting nose-heavy.

[watchnerd]

I love how everyone waited for OP to buy the car to post about the upcoming redesign.

Some states have a 'cooling off period' window during which one can reverse the decision.

^ Is that applicable to automobile purchases ? I didn't think any state had a "cooling off period" for automobile purchases.

Apparently some have it for used, but not for new.

[Cash is King]

I love how everyone waited for OP to buy the car to post about the upcoming redesign.

Some states have a 'cooling off period' window during which one can reverse the decision.

^ Is that applicable to automobile purchases ? I didn't think any state had a "cooling off period" for automobile purchases.

Apparently some have it for used, but not for new.

I didn't think it applied to new, but it is interesting to know some have it for used. Thanks.