And this is a different department from the one shared over the past few weeks.
Bad financing is not only about saving money.It's also about not making a strategic financial mistake.
I received a call from a new chief whose last chief had financed a new truck in 2008. The last chief had financed the truck for 15 years and did not put any money down.
Fast forward to 2016. The new chief is left with a truck that has some issues. He would like to just get rid of the truck and upgrade to a newer truck.
But the last chief hurt the new chief. The balance owed on the truck was more than what the truck was worth. So, the new chief could not refinance it or sell it and pay off the balance.
So, the new chief is stuck. Stuck with payments on a truck which is unreliable. He will have to make 7 more payments before its paid off and maybe then can replace the truck with something that works.
SummaryBad financing happens when you don't think of the now and the future. The old chief was focused on getting a truck without any down payment and the lowest payment amount. But that strategically hurt the department for years to come.
John R. Hill