I came across this ad for a 8 year loan at a 3.49% finance rate. Are 0% loans disappearing?
Is 0% financing a thing of the past?
- Thread starter Snagglefoot
- Start date
Yep. Financing is a moneymaker for the stealerships.
Well you wouldn't see 0% on anything above 60 months typically, and right now they don't need incentives to sell cars. There are almost no cash or financing incentives at all across the board right now. I'd expect to see them come back to some degree once product shortages ease.
There’s only interest because they know people will pay. Once there’s enough cars around for everybody they will be offering 0% to move cars.
Even if it goes to BTO they will still need 0% to get people to want their cars. BTO only works for cars that are in demand.
Even if it goes to BTO they will still need 0% to get people to want their cars. BTO only works for cars that are in demand.
I haven't seen decent financing from the auto banks in a long time.
Credit Unions still have good rates.
Credit Unions still have good rates.
SunTrust was top of the heap after shopping rates when I bought the Honda.
Next time the economy takes a dip, I bet it'll be back. Well, assuming the makers are sitting on inventory that is. maybe even if not, since they have contracts to honor (both with the union and perhaps with suppliers, they can only back out of so many deals before penalties bite them I bet).
But do I expect to see anytime soon? I'm dubious.
That said, is an interest rate of say 3% that bad? I mean, the fed says they will keep inflation to 2%. Or they used to say that. Right now we live in wonky times so inflation over the last year is an outlier. Assuming things get back to "normal" would a 3% or so loan be that bad? Even a percent or two higher, ok that's money lost to financing and all. But if it's around inflation, and you "have" to borrow, well...?
But do I expect to see anytime soon? I'm dubious.
That said, is an interest rate of say 3% that bad? I mean, the fed says they will keep inflation to 2%. Or they used to say that. Right now we live in wonky times so inflation over the last year is an outlier. Assuming things get back to "normal" would a 3% or so loan be that bad? Even a percent or two higher, ok that's money lost to financing and all. But if it's around inflation, and you "have" to borrow, well...?
98 months.... why not tack on another year to make it a round 110 months?
I was going to say I have no desire to have a new vehicle, but that hybrid Maverick is looking good.
The only reason I financed the Subaru when I had that was the 0% interest. Otherwise I would have gone with a check.
Due to shortages, manufacturers are able to sell every vehicle they're making. That, combined with a lot of inflation, there's just no need to do 0% interest. I would assume that most banks would have to do a pretty high finance charge in order to be able to make any money on 0% finance.
The only reason I financed the Subaru when I had that was the 0% interest. Otherwise I would have gone with a check.
Due to shortages, manufacturers are able to sell every vehicle they're making. That, combined with a lot of inflation, there's just no need to do 0% interest. I would assume that most banks would have to do a pretty high finance charge in order to be able to make any money on 0% finance.
Playing around with Ford's configuration I built a F150 that was $48000. Pretty typical vehicle.
3.9% at 84 months. $4845 downpayment
$574 a month for 7 years. That's a lot!
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And 48k is not even close to the higher end trim levels.
I think 0% is a thing of the past. One of the reasons I bought my caravan was 0% for 60 months and something like 18k of rebates off the sticker price. I was usually a Toyota/Honda minivan buyer but they would gave cost me an extra 15k at the time.
Prices are absolutely insane. I bet it's probably 5 more years before things settle down.
Prices are absolutely insane. I bet it's probably 5 more years before things settle down.
While I have done financing before, I have never even considered anything more than 5 years at 1.90-3% (usually paid off it 3-4 years), 8 years is just plain stupid.
The 0% offers were usually for 3 year terms with higher down payments (except for some low volume, high inventory vehicles or older stock).
As others have said, the 0% offers were to get more sales, and right now, they don't need it, same for rebates and such, just not around like they used to be.
In a year or so, they may be back if clown world calms down.
The 0% offers were usually for 3 year terms with higher down payments (except for some low volume, high inventory vehicles or older stock).
As others have said, the 0% offers were to get more sales, and right now, they don't need it, same for rebates and such, just not around like they used to be.
In a year or so, they may be back if clown world calms down.
8 years is fine, heck 12 years is fine..... if you are getting a good rate - AND you absolutely know that you will keep the vehicle at least that long. Problem is that people that make bad financial decisions usually think they will drive the car for 10 years, but when the new one comes out with new blueteeth features they gotta trade up, which costs them dearly. And then the cycle continues.
Inflation rate is officially 6.8% in USA at the moment and will go higher next year, so that 3.49% rate is a 'steal' ...lol
With high inflation a car may still be worth its original dollar value after it's paid off a few years later ...LOL
With high inflation a car may still be worth its original dollar value after it's paid off a few years later ...LOL
