Texas Buyers: Financing pitfalls and rates

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JeopardE

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Mar 24, 2018
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185
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Houston
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Model 3
#1
Several of us in Texas have run into this problem:

Loan is fully approved, and bank requests registration info from Tesla in order to provide drafting instructions.

- Tesla cannot perform any kind of registration or title application until vehicle is fully funded first.
- Bank will not fund the transaction until they have proof of registration with lienholder information.
- Occasionally, bank asks for "letter of guarantee" in lieu of title documents. ISA forwards request (in my case at least) to documentation team but Tesla seems unwilling to do this either (ostensibly due to the same TX legal issue).

You have a couple of options out of this impasse:

1. If you have prime credit, apply for an unsecured loan with Lightstream. After you're approved, send them your rate documents from your bank or credit union. They will beat the rate by 0.10% (as long as it is not for a shorter loan term!).

2. Apply for financing with a federal credit union outside Texas. A lot of people have had success with Xceed I believe.

Other TX tips welcome.
 
Joined
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Dallas, TX
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Country
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Model 3
#2
Several of us in Texas have run into this problem:

Loan is fully approved, and bank requests registration info from Tesla in order to provide drafting instructions.

- Tesla cannot perform any kind of registration or title application until vehicle is fully funded first.
- Bank will not fund the transaction until they have proof of registration with lienholder information.
- Occasionally, bank asks for "letter of guarantee" in lieu of title documents. ISA forwards request (in my case at least) to documentation team but Tesla seems unwilling to do this either (ostensibly due to the same TX legal issue).

You have a couple of options out of this impasse:

1. If you have prime credit, apply for an unsecured loan with Lightstream. After you're approved, send them your rate documents from your bank or credit union. They will beat the rate by 0.10% (as long as it is not for a shorter loan term!).

2. Apply for financing with a federal credit union outside Texas. A lot of people have had success with Xceed I believe.

Other TX tips welcome.
This is exactly what I'm going through right now. JOUL3S, when you switch from credit union to Lightstream, did Tesla have to update the lender on the purchase agreement, etc logistics stuff that cause extra delay?? I'm thinking about what you suggested.

Really appreciate it if more people who have gone through this can shed some light on this issue.

Tesla has shipped 30000+ Model 3 by now and how can they not have an SOP on this??
 

JeopardE

Active member
Joined
Mar 24, 2018
Messages
185
Location
Houston
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Country
Tesla Owner
Model 3
#3
This is exactly what I'm going through right now. JOUL3S, when you switch from credit union to Lightstream, did Tesla have to update the lender on the purchase agreement, etc logistics stuff that cause extra delay?? I'm thinking about what you suggested.

Really appreciate it if more people who have gone through this can shed some light on this issue.

Tesla has shipped 30000+ Model 3 by now and how can they not have an SOP on this??
With Lightstream the process is simple. Tesla switches your payment mode to cash and will open an ACH payment form for you on the website. Lightstream makes an ACH deposit in your bank account and you make the payment to Tesla. Very smooth.

As soon as you've submitted the payment they schedule your delivery. Both ACH transactions take the same time (2 business days) so you can do it as soon as you've confirmed the funds deposit day with Lightstream.
 
Joined
Sep 3, 2017
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Dallas, TX
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Country
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Model 3
#4
With Lightstream the process is simple. Tesla switches your payment mode to cash and will open an ACH payment form for you on the website. Lightstream makes an ACH deposit in your bank account and you make the payment to Tesla. Very smooth.

As soon as you've submitted the payment they schedule your delivery. Both ACH transactions take the same time (2 business days) so you can do it as soon as you've confirmed the funds deposit day with Lightstream.
Wish I knew this earlier. Well, now I'm just gonna at least wait to see what my ISA has to say first. Lightstream is plan B. Thanks.
 

kelvinpt

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Jun 22, 2018
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Houston
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Model 3
#5
My ISA was able to give me "letter of guarantee". She actually had to get it twice because the address was wrong.
 

JMZMartin

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North Texas
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Model 3
#6
Thanks for this information JOUL3S. I got my notice to configure and order a month and a half ago. But this post made me nervous about being able to use my preferred lender. And sure enough when I went to my local credit union to let them know ahead of time I would later come back to finance the car there (since I have a long term relationship with them) a supervisor chimed in and said quite adamantly "they don't do Tesla". He said it was because Tesla won't follow the CU's drafting instructions. I explained the issue to the Tesla staff. Who then communicated directly with the credit union even though I don't have an ISA yet. Once the letter of guarantee was discussed it *seems* to have put everyone involved on the same page. We'll see. I literally just ordered today so it will be some time before anything happens. But also thanks to this post - I went out and found a backup financing option.
 

dannyskim

Active member
Joined
Nov 14, 2016
Messages
69
Location
Austin, Texas
#7
I used University Federal Credit Union as I was already a member there.

The process was painless on my end. MVPA signed, supervisor advisor signed, sent signed MVPA to my UFCU loan officer and he took care of the rest by ACH'ing directly to Tesla.

UFCU states that they deal with Tesla quite a bit and it showed in my hands off experience with my loan officer.
 

JMZMartin

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North Texas
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#8
That's good to know Danny. I've used this same credit union since I moved to Denton in 2008. They know me when I walk in the front door. Never had any issues with any accounts or loans. When I bought my Aprilia a few years ago things went much as you described. I never even had to go into the credit union office. I walked into the dealership picked what I wanted, called up the credit union and left half an hour later with a new ride. Which is why this issue with the Model 3 purchase was so strange. Maybe they lost a big time customer over a Model S or X or something. But good to know other Texas credit unions have a handle on the process.
 

JMZMartin

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North Texas
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#9
Well... sure enough I got a call from my local DATCU Credit Union after they spoke to the Tesla staff in Southlake I was working with. And DATCU will not (they said cannot) be the initial financing on my Model 3. Even the letter of agreement was not enough because the credit union has strict rules on what they will fund and how. They will not give money without the car and Tesla won't even assign the VIN (I was told) without things being paid up front. I knew what I was getting into thanks to this forum thread and others but thought that surely this wasn't such a unique situation there wasn't some documentation that would allow a way to work it all out. Oh, well I'll just use my bank or a different credit union. Just bums me out because I love my local branch.
 

GDN

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Far North Dallas, TX
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#10
Well... sure enough I got a call from my local DATCU Credit Union after they spoke to the Tesla staff in Southlake I was working with. And DATCU will not (they said cannot) be the initial financing on my Model 3. Even the letter of agreement was not enough because the credit union has strict rules on what they will fund and how. They will not give money without the car and Tesla won't even assign the VIN (I was told) without things being paid up front. I knew what I was getting into thanks to this forum thread and others but thought that surely this wasn't such a unique situation there wasn't some documentation that would allow a way to work it all out. Oh, well I'll just use my bank or a different credit union. Just bums me out because I love my local branch.
Interesting. The only thing I will comment on is that I don’t think anyone will fund the loan without the VIN. Mine wouldn’t, a CU in Plano. But the VIn is part of the contract/MVPA sobit was a known thing and I had it assigned befire trying to pay for the car. No one will find a loan without the VIN I don’t think. Almost all of them will find without the car or Tesla wouldn’t sell any in TX, but the VIN, yes that has to be known for the lender. That identifies the collateral.
 

JMZMartin

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North Texas
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Model 3
#11
Looks like my little financing saga might be over. I always research what I want. Get pre-approved and then start shopping. That way I can have the funds ready to go and not deal with the runaround. Also, I was certain DATCU would need the VIN so I wasn't worried about that. But the DATCU loan agent said that Tesla was a complete no-go because Tesla would not even give the MVPA without the car being fully paid. Which sounded like maybe they spoke to the wrong person. I'm not sure because it's my first Tesla purchase. Anyway, I wasn't worried about it because I knew it would be at least a month or so before I was even assigned an ISA giving plenty of time to go with my bank or an online CU.

Well, my ISA emailed me today. I checked in with DATCU one last time. They reiterated they weren't going touch anything Tesla related for a new purchase. Then my better half pointed out that we're also members at Credit Union of Texas. I was reluctant to call but when I asked if they would even consider financing part of my purchase and if they were familiar with the issues with Tesla financing in Texas the loan team member explained that "Yes. Tesla purchases in Texas are convoluted in some ways but we do lots of them. We can take care of it." Too good to be true, I thought. So I basically interrogated her (nicely) and asked about the problems with Telsa shoppers have had here, issues assigning VINs, letters of agreement and MVPAs. She patiently explained CUTX has had a process in place for a while because of the number of Tesla loans they handle. She knew about contacting my ISA and how to work with them directly.

This isn't a commercial for CUTX but I was pre-approved and ready to go before I got off the phone (less than ten minutes). Heck, it took longer to get all my paranoid questions answered than it did to get financing. She even assured me that most of their current financing is for Model 3s (I asked her multiple times) so they know what to look for and who to ask for as things go forward. I've already sent over some of the needed documentation and just have to wait for the buyer's order. I will follow up on how things go but it looks like there is another local financing option for those of us in North Texas.
 
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PNWmisty

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Aug 19, 2017
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Anacortes, WA
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#12
I checked in with DATCU one last time. They reiterated they weren't going touch anything Tesla related for a new purchase.
I would file a complaint to the Board of Directors. Other Credit Unions in Texas have no problem financing Teslas. CU's exist to serve their members and a quick check of DATCU online reviews turns up some stories of pretty horrible service (not Tesla related). Probably the President of the CU is a Tesla short-seller in his/her personal life.
 

JMZMartin

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North Texas
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#13
Not sure about the short-seller part but I'm very likely going to contact the president and someone on the board. I've already got an appointment pending with the manager. Honestly I've had some issues with this CU before but never anything major and it's always been fixed fairly quickly. I've seen some of the online reviews and those seemed to have come up more frequently in the last 4 years or so. I've been a member for nearly 10 so nothing has really impacted us until now.

But (keyword) since then, like you said, I've discovered the other CUs in Texas have absolutely no problems working with Tesla, they have procedures in place to make things run smoothly. So my conclusion is my current (soon to be former) institution just doesn't want to deal with it. Fine by me. I got a better rate at the CU literally 15 minutes down the road that I already do business with. That lending advisor is already working directly with my Tesla advisor. All this in less than 24 hours.
 
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JMZMartin

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#14
Sorry. Another point - I also checked with Alliant Credit Union online since I was quietly urged to get a competing rate by my awesome new lending team advisor so they would match it. Alliant has a pretty easy online app and actual separate categories for new and used Tesla loans with functionality for uploading all needed documents. No fuss and very clear instructions throughout. Be interesting to see how they compare. Will report back on both the CUTX and Alliant experiences if anyone is curious.
 

JMZMartin

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North Texas
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#16
Heard back from Alliant this morning. They were fast and very detailed. They also immediately assigned a loan consultant to handle things if I went forward. Someone who seemed to know the Tesla buying process for Texas. So dealing with them in the initial stages was great. However they came back with a higher rate than the one I already have locked in. So that was as far as I got. Other than that, I didn't have a problem with Alliant. As always, your mileage may vary.

I was a little bummed. I'm pretty stingy about credit use and credit hits due to a less than amicable divorce a long time ago. (Probably too much information) So I'm not going to shop around anymore after looking at 2 local and 1 online lender. Plus Alliant couldn't beat the home team, so I'm sticking with Credit Union of Texas. Don't know if that helps.
 
Joined
Oct 16, 2018
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Houston, TX
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Reservation
#17
@JMZMartin , what rate did you got with Credit Union of Texas. I have a pretty good score (>750) and am looking for 84 month (7 year) financing. Expected delivery Nov 18. Thanks.
 

davinmma

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Oct 18, 2018
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1
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Dallas, TX
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Country
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Model 3
#18
@JMZMartin , what rate did you got with Credit Union of Texas. I have a pretty good score (>750) and am looking for 84 month (7 year) financing. Expected delivery Nov 18. Thanks.

I just recently closed on my AWD-M3. and i did extensive research.. i ended up going with UFCU @ 2.95%. I asked each credit union what report they look at.. and based on the best rate, and easy to use website, good customer service, thats where i focused on cleaning up my credit score. paid alot of stuff down and made my credit score jump up more.. some of them unfortunately didnt update on time (e.g. equifax). But oh well, equifax wasnt one of the ones they looked at anyway.
experian credit score = 749
equifax = 734
Transunion = 797



2 star rating
https://www.rbfcu.org/nola
When applying online application
66 months or less w/ Transunion credit score = 2.90
Call 1800-580-3300
Customer rating is 2 stars on wallethub



https://fpcu.org/contact-us
Experian
60 month loan
2.99
Customer rating is 3 stars



Credit Union of Texas
https://www.cutx.org/Drive-it/Auto-Loans/
Credit Union of Texas
Routing Number: 311079306

8131 LBJ Freeway, Suite 500
Dallas, TX 75251-7028
Phone: 972-263-9497 or 800-314-3828
M-F - 9am - 6pm
Saturday 10am - 2pm
Customer rating 4
3.4 - 4.0
Credit score 756 EXPERIAN = 3.4%
below 756 = 4.0



4 star rating
University Federal Credit Union
https://www.ufcu.org/
I went thru UFCU in Austin based on some of the users going through them. I got a rate of 2.75 for 66 months (the best rate I found in Texas as of 8/6/18. My Loan officer was Scott (512) 421-7367, skershaw@ufcu.org, he was extremely professional to deal with.
Monday – Friday: 8 AM – 6 PM
EXPERIAN:
740+ credit score on term: 60 = 2.95 - PREAPPROVED - PRE-REQUISITE: YOU MUST OPEN A SAVINGS ACCOUNT. Credit union is located in Austin.. so make sure you create the savings account with ZERO errors.... because if it gives you an error message when creating a savings account online, you will have to drive 4-5 hours to Austin to get it done in person.
 
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Watzon

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May 7, 2018
Messages
52
Location
Austin, Texas
Country
Country
Tesla Owner
Model 3
#20
If in Austin or nearby, University Federal Credit Union is a great choice. Get a membership via many area non-profits. UFCU stated that they deal with Tesla quite a bit and it showed. Piece of cake.