McCarthy Wholesale

Is Synthetic Oil a Better Purchase

2008-06-11T12:26:00.000-07:00

Does your vehicle run off synthetic oil? Whats better? The regular petroleum based oil or the synthetic oil that supposedly lets your car run twice the amount miles. Synthetic oil has been on the market as early as 1970. Is it worth the purchase, and is it better for your vehicle? Here are some of the advantages and disadvantages of replacing your oil with synthetic:

Advantages

The technical advantages of synthetic motor oils include:

Measurably better low and high temperature viscosity performance

Bette chemical & shear stability

Decreased evaporative loss

Resistance to oxidation, thermal breakdown and oil sludge problems

Extended drain intervals with the environmental benefit of less oil waste.

Improved fuel economy in certain engine configurations.

Better lubrication on cold starts

Disadvantages

The disadvantages of synthetic motor oils include:

Initial costs are usually four times greater than petroleum-based oils, though at one time, man-made oils cost ten times more than petroleum. Initial costs are often mitigated by extended change intervals, which individuals may confirm through used oil analysis (UOA).

The lower friction may make them unsuitable for break-in (i.e. the initial run-in period of the vehicle) where friction is desirable to cause wear.

Improved engine part machining has made break-in less critical than it once was though. Many modern cars now come with synthetic oil as a factory fill.

Potential decomposition problems in certain chemical environments (industrial use dominantly)

Potential stress cracking of plastic components like POM (polyoxymethylene) in the presence of PAOs (polyalphaolefins).

Potential on some older pushrod race engines with roller lifters for the roller itself not to spin with camshaft movement, but rather slide while the roller itself remains either stationary or at a lower circumferential speed than that of the camshaft lobe.

In July 1996, Consumer Reports published the results of a two year motor oil test involving a fleet of 75 New York taxi cabs and found no noticeable advantage of synthetic oil over regular oil. In their article, they noted that "Big-city cabs don't see many cold start-ups or long periods of high speed driving in extreme heat. But our test results relate to the most common type of severe service - stop-and-go city driving." According to their study, synthetic oil is "worth considering for extreme driving conditions: high ambient temperatures and high engine load, or very cold temperatures." This research was criticized by some because most engine damage appears to be caused by cold starts, and their research method may not have included enough cold starts to be representative of personal vehicle use.

Understanding Vehicle Financing

2008-05-22T15:35:00.000-07:00

With prices averaging more than $28,000 for a new vehicle and $15,000 for a used vehicle, most consumers need financing or leasing to acquire a vehicle. In some cases, buyers use “direct lending:” they obtain a loan directly from a finance company, bank or credit union. In direct lending, a buyer agrees to pay the amount financed, plus an agreed-upon finance charge, over a period of time. Once a buyer and a vehicle dealership enter into a contract to purchase a vehicle, the buyer uses the loan proceeds from the direct lender to pay the dealership for the vehicle. Consumers also may arrange for a vehicle loan over the Internet.

A common type of vehicle financing is “dealership financing.” In this arrangement, a buyer and a dealership enter into a contract where the buyer agrees to pay the amount financed, plus an agreed-upon finance charge, over a period of time. The dealership may retain the contract, but usually sells it to an assignee (such as a bank, finance company or credit union), which services the account and collects the payments.

For the vehicle buyer, dealership financing offers:

Convenience – Dealers offer buyers vehicles and financing in one place.
Multiple financing relationships – The dealership’s relationships with a variety of banks and finance companies mean it can usually offer buyers a range of financing options.

Special programs – From time to time, dealerships may offer manufacturersponsored, low-rate programs to buyers.

This explains dealership financing and can serve as a guide as you evaluate your own financial situation before you finance a new or used vehicle. It will also help you understand vehicle leasing.

Federal Laws

Familiarize yourself with laws that authorize and regulate vehicle dealership financing and leasing.

Truth in Lending Act – requires that, before you sign the agreement, creditors give you written disclosure of important terms of the credit agreement such as APR, total finance charges, monthly payment amount, payment due dates, total amount being financed, length of the credit agreement and any charges for late payment.

Consumer Leasing Act – requires the leasing company (dealership, for example) to disclose certain information before a lease is signed, including: the amount due at lease signing or delivery; the number and amounts of monthly payments; all fees charged, including license fees and taxes; and the charges for default or late payments. For an automobile lease, the lessor must additionally disclose the annual mileage allowance and charges for excessive mileage; whether the lease can be terminated early; whether the leased automobile can be purchased at the end of the lease; the price to buy at the end of the lease; and any extra payments that may be required at the end of the lease.

Credit Practices Rule – requires creditors to provide a written notice to potential co-signers about their liability if the other person fails to pay; prohibits late charges in some situations; and prohibits creditors from using certain contract provisions that the government has found to be unfair to consumers.

Equal Credit Opportunity Act – prohibits discrimination related to credit because of your gender, race, color, marital status, religion, national origin or age. It also prohibits discrimination related to credit based on the fact that you are receiving public assistance or that you have exercised your rights under the federal Consumer Credit Protection Act.

Fair Credit Reporting Act – Gives consumers many rights, including the right to one free credit report each year. It allows consumers to call one number to notify credit reporting agencies and credit card companies of identify theft. It also provides consumers with a process to dispute information in their credit file that they believe is inaccurate or incomplete.

For more information on federal credit regulations and consumer rights, contact:Federal Trade Commission Washington, DC 20580Phone: (877) FTC-HELP (382-4357) Web site: http://www.ftc.gov/Federal Reserve SystemWashington, DC 20551Phone: (202) 452-3693Web site: http://www.federalreserve.gov/

State Laws

Your state’s laws may provide you with additional rights. For information on these laws, contact your state’s consumer protection agency or Attorney General’s office (Web site: http://www.naag.org/).

What About a Co-Signer?
You may be required by the creditor to have a co-signer sign the finance contract with you in order to make up for any deficiencies in your credit history. A co-signer assumes equal responsibility for the contract, and the account history will be reflected on the co-signer’s credit history as well. For this reason, you should exercise caution if asked to co-sign for someone else. Since many co-signers are eventually asked to repay the obligation, be sure you can afford to do so before agreeing to be someone’s co-signer.

Should I Lease a Vehicle?
If you are considering leasing, there are several things to keep in mind. The monthly payments on a lease are usually lower than monthly finance payments on the same vehicle because you are paying for the vehicle’s expected depreciation during the lease term, plus a rent charge, taxes, and fees. But at the end of a lease, you must return the vehicle unless the lease lets you buy it and you agree to the purchase costs and terms. To be sure the lease terms fit your situation:

Consider the beginning, middle and end of lease costs. Compare different lease offers and terms, including mileage limits, and also consider how long you may want to keep the vehicle.
When you lease a vehicle, you have the right to use it for an agreed number of months and miles.
At lease end, you may return the vehicle, pay any end-of-lease fees and charges, and “walk away.” You may buy the vehicle for the additional agreed-upon price if you have a purchase option, which is a typical provision in retail lease contracts. Keep in mind that in most cases, you will be responsible for an early termination charge if you end the lease early. That charge could be substantial.

Another important consideration is the mileage limit – most standard leases are calculated based on a specified number of miles you can drive, typically 15,000 or fewer per year. You can negotiate a higher mileage limit, but you will normally have an increased monthly payment since the vehicle’s depreciation will be greater during your lease term. If you exceed the mileage limit set in the lease agreement, you’ll probably have to pay additional charges when you return the vehicle.

When you lease, you are also responsible for excess wear and damage, and missing equipment. You must also service the vehicle in accordance with the manufacturer’s recommendations.
Finally, you will have to maintain insurance that meets the leasing company’s standards. Be sure to find out the cost of this insurance.

“Keys to Vehicle Leasing,” a publication of the Federal Reserve Board, contains more information about leasing. You can request a copy from:Publications ServicesBoard of Governors of the FederalReserve SystemMail Stop 127Washington, DC 20551

This brochure is also available on the Web at: www.federalreserve.gov/pubs/leasing

How To Fix Your Bad Credit

2008-02-22T13:06:00.000-08:00

A good credit score is very valuable tool to have these days. Whether you're purchasing an automobile, house, or student loan you're going to want good credit. The reason good credit is neccesary is to get financed and to get the best possible interest rate. In the United States interest rates can vary from zero percent to over thirty percent. A high interest rate means higher payments and more interest paid on your loan. Ultimately this means less money in your pocket. So you've made a few mistakes in the past. Does that mean you have to pay for it for the rest of life?

One of the best ways to begin improving your credit score is by applying for an auto loan. It may take a lot of work to get you approved but in the end it is going to be worth your time. Let's say for example you live in San Luis Obispo and you've been attending Cal Poly for the past few years. You have student loans and some unpaid bills here and there. You basically have what we call "not so good credit". You go to apply for a vehicle loan and the bank comes back at you with a 24.9% interest loan. You think to yourself, theres no way I'm about to give a quarter of my money towards interest on a loan. Unfortunately at this point, you might just want to bite the bullet and accept.

So lets say you decide to accept your high interest loan and you purchase your vehicle. Your payments are three hundred dollars a month. Banks encourage their customers to make payments early and pay a little extra than the actual payment amount. For the next eight months you pay three hundred and fifty dollars payments five days early. Most of the time this will build enough credit to refinance your loan several times with your bank or another. You continue to do this over the sixty month loan period and you'll have an excellent auto loan on your credit bureau. A satisfied auto loan can do wonders for a credit score.

If you can't find anyone to co-sign for your loan and you need to fix your credit this is a great solution. Although this process takes patience, eventually it will be very beneficial. So sometimes you have to accept your high interest rates, pay your loan off quickly and fix your credit because in the end you obtaining good credibility.

To Fly Or To Drive: That Is The Question

2008-02-12T12:04:00.000-08:00

As I’m sitting in the airport last weekend in crowded lines and expensive air fares, I questioned myself whether it is easier to fly or drive now. I’m flying a total of 1,400 miles from California to Arizona. The price of the ticket was $383.92 round trip. I spent about five hours between security and the flight. Was it worth the $383 for the ticket that took half the time as a ride along the coast?

If I had taken a car it would have taken me around 10 hours or so to get there. If I took a 2006 Honda Civic which gets around 35 mpg and gas being around $3.25 a gallon. I figure it would cost around $130. But let’s say I had a few things I had to pick up so I wanted to take a truck. I would want good gas mileage and a good truck to take would be a Toyota Tacoma. These trucks get around 25 mpg. Round trip this truck would cost me $180 in gas. Now lets say I decided I wanted to go with a little style and decided to take a Cadillac Escalade. This vehicle gets about 18 mpg on the highway. The total cost of this trip in gas would be around $252. If I brought a person with me and split gas it would cost me half. As opposed to bringing someone with you on an airline and you end up paying double.

After thinking everything over and calculating it out I would rather spend double the time, enjoy the drive and pay less than half of what an airline would cost me.