Often, if using your credit card means incurring a fee, its better to pay another way. Why spend more than you need to? But in some cases, the fee might be outweighed by rewards.
For example, 29-year-old Keith Rosso and his wife Liz recently paid $58,857, including taxes and fees, for a Tesla Model 3 using a credit card.
In Million Mile Secrets, Rosso writes, “If you use credit cards responsibly, making a large purchase to earn tons of points is an easy win.”
Hey, automotive enthusiasts! Have you ever wanted to drive a sleek Tesla down the highway and leave a trail of jealous looks in your wake? Well, hold onto your hats because the answer to your urgent question is a resounding YES! However, before you pull out your credit card and start visualizing yourself behind the wheel, let’s go over the specifics of how it all works.
Buckle Up: Understanding the Tesla Financing Landscape
While the allure of a Tesla purchase is undeniable, the financial aspect can get a tad confusing. Worry not my friend for I’m here to break it down for you in a way that even a caveman could understand.
Here’s the deal: Tesla offers a variety of payment options to suit your financial needs, You can choose from:
- Cash: This is the most straightforward option, but let’s be honest, not everyone has a spare fortune lying around.
- Financing: Tesla partners with various lenders to offer competitive financing rates. This allows you to spread the cost of your Tesla over a period of time, making it more manageable.
- Leasing: This option gives you the flexibility to drive a Tesla without having to commit to ownership. You essentially rent the car for a set period, with the option to purchase it at the end of the lease term.
Now let’s get to the juicy bit: credit cards.
Credit Card Power: Your Key to Unlocking Your Tesla Dream
Yes, you can absolutely use a credit card to purchase your Tesla. Actually, it might be a wise choice, particularly if your card offers cashback or rewards points. Imagine earning miles or points as you drive your brand-new Tesla—now that’s a win-win scenario!
However, there are a few things to keep in mind:
- Not all credit cards are created equal. Some cards have higher purchase limits than others, which might be a limiting factor depending on the Tesla model you’re eyeing.
- Transaction fees can apply. Depending on your card issuer, you might have to pay a transaction fee when using your credit card for such a large purchase.
- Interest rates can bite. If you don’t pay off your balance in full each month, you’ll be charged interest, which can add up quickly.
Therefore, do your homework and select a credit card that fits your spending patterns and financial situation before you swipe away.
Navigating the Tesla Financing Maze: A Step-by-Step Guide
Ready to take the plunge and become a proud Tesla owner? Here’s a step-by-step guide to help you navigate the financing process:
- Choose your Tesla: Head over to the Tesla website and browse through their stunning lineup of electric vehicles. Pick the one that makes your heart skip a beat and fits your budget.
- Get pre-approved for financing: This will give you a clear picture of how much you can afford to borrow and help you negotiate better terms with lenders.
- Compare financing options: Explore the various financing options available, including Tesla’s in-house financing and loans from third-party lenders. Choose the option that offers the most competitive rates and terms.
- Finalize your purchase: Once you’ve secured financing, head to your local Tesla dealership and finalize the purchase. Don’t forget to bring your credit card and any other required documentation.
Pro Tips for Financing Your Tesla Like a Boss
Listen up, aspiring Tesla owners! Here are a few pro tips to help you ace the financing game:
- Boost your credit score: A higher credit score will qualify you for lower interest rates, saving you money in the long run.
- Make a substantial down payment: This will reduce your loan amount and monthly payments, making your Tesla more affordable.
- Explore alternative financing options: Consider using a home equity line of credit or a personal loan if they offer more favorable terms than traditional car loans.
- Negotiate with confidence: Don’t be afraid to negotiate the interest rate and terms of your loan. Remember, knowledge is power, so do your research and come prepared.
Frequently Asked Questions: Your Tesla Financing Queries Answered
Still have some lingering questions about financing your Tesla? Don’t fret, my friend, for I’m here to address your concerns:
- Can I use a credit card to pay for the entire cost of a Tesla?
Putting such a big purchase on a credit card is not advised unless you have a high credit limit and can pay it off quickly, even though it is technically possible. Remember, interest rates on credit card balances can be steep, so tread carefully.
- What are the benefits of using a credit card to buy a Tesla?
Using a credit card can earn you valuable rewards points or cashback, which can be redeemed for travel, merchandise, or even statement credits. Additionally, some credit cards offer extended warranties or purchase protection, providing extra peace of mind.
- What are the risks of using a credit card to buy a Tesla?
The biggest risk is falling into the trap of high-interest debt. If you don’t pay off your balance in full each month, the interest charges can quickly snowball, making your Tesla purchase a financial burden.
- What are some alternative ways to finance a Tesla?
In addition to credit cards, you can explore options like personal loans, home equity lines of credit, or even leasing. Each option has its own set of pros and cons, so carefully evaluate your financial situation and choose the one that best suits your needs.
Additional Resources: Deep Dive into Tesla Financing
- Tesla Financing Website: https://www.tesla.com/support/ordering-new-vehicle
- Tesla Credit Card Comparison: https://www.nerdwallet.com/article/finance/tesla-credit-card
- Tesla Leasing Guide: https://www.edmunds.com/tesla/model-3/2023/lease-guide/
The Bottom Line: Your Tesla Dream Awaits
And there you have it, people! The short answer to “Can you buy a Tesla with a credit card?” is definitely yes, but there are a few things to be aware of. You can make your Tesla dream come true by carefully evaluating your financial status, looking into different financing options, and making prudent use of your credit card. Now, go forth and conquer the road in your sleek, electric masterpiece!.
Read more about electric vehicles, batteries and chips from CNBC Pro
Rosso points out that there’s no guarantee that this will always be the case, but buying the car through Plastiq qualified for that 3-point reward rate. The Ink Business Preferred may one day only reward Plastiq purchases with 1 point per dollar.
The 2. Approximately $1,470 was the 5 percent fee, and he received nearly 180,000 Chase Ultimate Rewards points for the purchase. At minimum thats $1,800 in value, but it could be worth even more when redeemed for travel. Rosso believes the points could be worth up to $5,000 if they are transferred to the appropriate hotel or airline rewards programs.
In short, the rewards easily make up for Plastiqs fee.
How he did it
Tesla accepted the payment through Plastiq, a third-party service that charges a 2.9% fee, even though they wouldn’t allow Rosso to buy the car directly with his credit card. 5 percent fee.
“The way I paid for my Tesla was with the Chase Ink Business Preferred card, which gave me three times as many points as I would have otherwise,” Rosso says to CNBC Make It. Cardholders with Ink Business Preferred earn three points for each dollar spent in a variety of categories aimed at helping small-business owners. Those categories include travel, shipping, advertising and internet, phone and cable services.