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Zero % Car Loans

What Would Jesus Do?

What Would Jesus Do?

HB King
Nov 28, 2010
86,037
40,365
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Maryland
I'm starting to see these again. Why?

Are companies just jacking up the asking price and then giving it back through low interest terms? Or are they looking ahead to an economic downswing that will require the Fed to slash rates, and they're just getting ahead of the curve?
 
TennNole17 said:
780, is what I have read.
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damn!!

I just checked Toyota and it states...

To qualify for Toyota's 0% interest financing program, you must have a credit score of at least 690, which is in the prime credit tier. The prime tier is for buyers with a credit score between 661 and 780, but the minimum credit score for the program is 690. Buyers with credit scores between 781 and 850 are in the superprime credit tier, which typically qualify for the best interest rates, including 0% interest. You must also make a 10% down payment, and the program has other stipulations.
 
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If I can convince the wife, I’m hoping to be in the market for a new car this year and hope to get a <1% rate, otherwise I’ll buy straight cash homie.
 
QChawks said:
damn!!

I just checked Toyota and it states...

To qualify for Toyota's 0% interest financing program, you must have a credit score of at least 690, which is in the prime credit tier. The prime tier is for buyers with a credit score between 661 and 780, but the minimum credit score for the program is 690. Buyers with credit scores between 781 and 850 are in the superprime credit tier, which typically qualify for the best interest rates, including 0% interest. You must also make a 10% down payment, and the program has other stipulations.
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nice
 
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What Would Jesus Do? said:
I'm starting to see these again. Why?

Are companies just jacking up the asking price and then giving it back through low interest terms? Or are they looking ahead to an economic downswing that will require the Fed to slash rates, and they're just getting ahead of the curve?
Click to expand...
In my experience if you get a 0% loan, you're not also getting a "deal". It's an either or type situation.

Unless, of course, you have some dirt on the finance manager. That could come in handy.
 
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alaskanseminole said:
In my experience if you get a 0% loan, you're not also getting a "deal". It's an either or type situation.

Unless, of course, you have some dirt on the finance manager. That could come in handy.
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Dealers are getting desperate. Last August I bought a new GMC sierra. I was able to get rebates and low interest .9%. Since I bought my truck the incentives have got even better.
 
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Usually when they have 0% offers it's in lieu of cash rebates - pretty easy to do the math and see which option is better. You have to make the minimum payment and not pay in advance at all to get the full benefit though, and a lot of folks like to pay their loans ahead.
 
StormHawk42 said:
If I can convince the wife, I’m hoping to be in the market for a new car this year and hope to get a <1% rate, otherwise I’ll buy straight cash homie.
Click to expand...
Hell take anything less than 4, find a CD for your cash 5%+ and pocket the difference. You're essentially a bank at that point!
 
isufan21 said:
Dealers are getting desperate.
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Oh so much this.

It really doesn't matter what automaker you're talking about, most all of their dealers have lots absolutely full of unsold vehicles - and automakers need those lots to clear room for 2025's (which in some cases are already being allocated).

Those dealers borrow the money to have those vehicles on their lots, and if they can't sell them...
 
Kelsers said:
How much less could you buy the car with cash vs 0% loan?
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Wasnt 0%, but paying in cash saved me $5k on my last new vehicle purchase.

Sure, dealers make their money off financing, but if they can sell a $40k vehicle and be done in 20 minutes, I think they will easily take that money.
 
I already have a vehicle. No car payment for over a decade. Our "newest" car - my no pic wife's used Subaru we paid cash.
 
Ree4 said:
Hell take anything less than 4, find a CD for your cash 5%+ and pocket the difference. You're essentially a bank at that point!
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Is it really worth it for an extra $500? I'd rather have the peace of mind of owning a vehicle outright.
 
Kelsers said:
How much less could you buy the car with cash vs 0% loan?
Click to expand...

No difference. In fact, you could get a worse deal.

If you're paying cash, you're eliminating one of the three ways dealers try to make a profit: the sales price, the trade in price, and the finance office.

If you announce you're paying cash, they're unlikely to move on the other two profit centers.
 
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OrlandNole said:
Is it really worth it for an extra $500? I'd rather have the peace of mind of owning a vehicle outright.
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I had and still have enough cash to purchase my car outright, but why do that if I'm using someone else's money?

Bought the current Tradmobile at 0% for 60 months with no payments for 90 days and no down payment required.

Meanwhile, my $40K is earning interest.
 
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…and I’m gonna have an aneurysm if anyone brings up the “pay cash for a depreciating asset; finance an appreciating one” stupidity.
 
The Tradition said:
No difference. In fact, you could get a worse deal.

If you're paying cash, you're eliminating one of the three ways dealers try to make a profit: the sales price, the trade in price, or the finance office.

If you announce you're paying cash, they're unlikely to move on the other two profit centers.
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Hence, you don't announce your paying with cash. Usually one of the first questions asked is financing.
 
The inflation cooling and fed rate showing signs of peaking and likely a future drop is also a factor in addition to wanting to increase sales. It would not be happening without that.
 
OrlandNole said:
Is it really worth it for an extra $500? I'd rather have the peace of mind of owning a vehicle outright.
Click to expand...
Well, for a $15,000 vehicle financed at 4% while putting $15,000 in something at 5%, you'd earn about $2000 more over a 5 year period. I think "peace of mind" is overrated in this case when you have the peace of mind that you COULD pay it off any second you want and are coming out that far ahead.
 
Ree4 said:
Well, for a $15,000 vehicle financed at 4% while putting $15,000 in something at 5%, you'd earn about $2000 more over a 5 year period. I think "peace of mind" is overrated in this case when you have the peace of mind that you COULD pay it off any second you want and are coming out that far ahead.
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Only an HROT poor would finance a $15,000 vehicle. ;)
 
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Ree4 said:
Well, for a $15,000 vehicle financed at 4% while putting $15,000 in something at 5%, you'd earn about $2000 more over a 5 year period. I think "peace of mind" is overrated in this case when you have the peace of mind that you COULD pay it off any second you want and are coming out that far ahead.
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If you take out a $15,000 loan at 4% for five years, you're paying $3,000 in interest. A CD at 5% over the same period will earn $3,750. That's $750.
 
Hawki97 said:
Although not always the case, my thoughts on buying a car with cash (which I do often) are linked below from a prior thread on the same topic:

https://iowa.forums.rivals.com/thre...e-same-as-poor-er-people.442184/post-12080070
Click to expand...

Your understanding of the situation is correct,.. For the best cash deal you need to play their financing game, confirm there is no penalty for early payment, close the deal, take the vehicle home and then pay off the note in it's entirety...
 
OrlandNole said:
If you take out a $15,000 loan at 4% for five years, you're paying $3,000 in interest. A CD at 5% over the same period will earn $3,750. That's $750.
Click to expand...
The loan would be paid down over the 5 years so it would be ~$1600
 
Buy your car, pay cash, invest your idle funds as you see fit because you have no need to spend any of it,.. life is good.
 
Rifler said:
Your understanding of the situation is correct,.. For the best cash deal you need to play their financing game, confirm there is no penalty for early payment, close the deal, take the vehicle home and then pay off the note in it's entirety...
Click to expand...

I'm very aware of my correctness. I've bought so many cars over the years I should hold a masterclass. I absolutely love the process of hunting the car, haggling for the car, and squeezing the best deal out of it. Patience, realizing there's always another car out there**, and the ability to walk away is key.

**does not apply to classic or specialty cars unfortunately
 
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