|
|
08-23-2011, 04:16 PM
|
#1
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Apr 2004
Location: South Texas~29N/98W Just West of Woman Hollering Creek
Posts: 6,674
|
0.00% Loan Interest Rate
I'm in the process of buying a new Toyota product and was planning on paying cash as I always do. During my chat with the fleet sales mgr he mentioned that if I had a FICO score of 650 or greater I could qualify for a 36 month 0% loan. He threw in ~"It's a no brainer."
I prefer having a paid off car, but can't help being tempted in accepting the loan as I doubt that I will ever get a better rate. Toyota just wants to sell cars and they are being aggressive on this issue (or so my logic says.)
If you had the money in savings and getting about 0.50% yield in that account, would you be tempted to accept the 0% offer if you could pay off the balance at any time if you just did not like the deal for some reason?
__________________
Part-Owner of Texas
Outside of a dog, a book is man's best friend. Inside of a dog, it's too dark to read. Groucho Marx
In dire need of: faster horses, younger woman, older whiskey, more money.
|
|
|
|
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!
Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!
You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!
|
08-23-2011, 04:18 PM
|
#2
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2002
Location: Texas: No Country for Old Men
Posts: 50,021
|
Take the free money loan!
__________________
Numbers is hard
|
|
|
08-23-2011, 04:26 PM
|
#3
|
Moderator Emeritus
Join Date: May 2007
Posts: 12,901
|
I would take the 0% loan. If down the road you change your mind, you can just pay it off and be done with it.
|
|
|
08-23-2011, 04:31 PM
|
#4
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Sep 2005
Posts: 5,381
|
I'm always skeptical of 'free.'
I'd go through the process. Make sure they wouldn't give me a better deal on the car for a cash transaction (free financing is sometimes paid for with higher up-front product prices). Make sure there were no 'documentation' fees or any other nonsense that pops up in the loan process. And if 0% is really 0%, I'd take the loan and plop the cash I would have used to buy the car in a CapitalOne savings account to earn 1%.
__________________
Retired early, traveling perpetually.
|
|
|
08-23-2011, 04:34 PM
|
#5
|
Full time employment: Posting here.
Join Date: Nov 2009
Location: VA
Posts: 923
|
The 0% loan is usually instead of a rebate you could receive for paying cash. You can look at Edmunds.com to see what the current rebates and offers are for the particular model you're interested in.
__________________
Disclaimer - I am an independent insurance agent. If the above message contains insurance-related content, it is NOT intended as advice, and may not be accurate, applicable or sufficient depending on specific circumstances. Don't rely on it for any purpose. I do encourage you to consult an independent agent for insurance-related advice if you have a question that is specific in nature.
|
|
|
08-23-2011, 04:37 PM
|
#6
|
Full time employment: Posting here.
Join Date: May 2010
Posts: 862
|
Why not present a counter offer - if you refuse the loan and pay cash, can they knock off another 3-5% off the price of the car?
They must have a cost of money, and a cash offer is usually very attractive compared to a zero interest loan.
However, you have to watch out in case they jack up the price of the car to "compensate" for the loss in financing revenue.
If they refuse the reduced cash offer, you can always revert back to the loan.
I figure it's worth a try - economy sucks nowadays and car buyers are not plentiful around ( especially folks who can offer cash up front ).
|
|
|
08-23-2011, 04:46 PM
|
#7
|
Full time employment: Posting here.
Join Date: Nov 2009
Location: VA
Posts: 923
|
Quote:
Originally Posted by Coolius
Why not present a counter offer - if you refuse the loan and pay cash, can they knock off another 3-5% off the price of the car?
They must have a cost of money, and a cash offer is usually very attractive compared to a zero interest loan.
However, you have to watch out in case they jack up the price of the car to "compensate" for the loss in financing revenue.
If they refuse the reduced cash offer, you can always revert back to the loan.
I figure it's worth a try - economy sucks nowadays and car buyers are not plentiful around ( especially folks who can offer cash up front ).
|
Walking into a car dealership without an agreement in place these days is a sucker's bet. Doing a couple hours of research on Edmunds and some car forums, then negotiating by e-mail with the dealer will always yield the lowest price and best terms. Knowing exactly how much they are making on the car and presenting a fair offer is the best bet. They will know you're an internet buyer who knows the ins and outs of pricing and won't beat around the bush, making you sit and argue about price for 8 hours while the managers are laughing at how much of a sucker you are from the other room.
__________________
Disclaimer - I am an independent insurance agent. If the above message contains insurance-related content, it is NOT intended as advice, and may not be accurate, applicable or sufficient depending on specific circumstances. Don't rely on it for any purpose. I do encourage you to consult an independent agent for insurance-related advice if you have a question that is specific in nature.
|
|
|
08-23-2011, 04:52 PM
|
#8
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2005
Posts: 10,252
|
We did take a 0% loan for the last car we bought. We also got the rebate. Just because of that, I think we paid too much for the car.
You may not get anywhere trying to trade the 0% loan for a lower price. This is because the 0% loan comes from the finance wing of the car manufacturer and not from the dealership. The dealer may not care if the finance folks make their quota of loans or not.
|
|
|
08-23-2011, 04:54 PM
|
#9
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2002
Location: Texas: No Country for Old Men
Posts: 50,021
|
Quote:
Originally Posted by LOL!
You may not get anywhere trying to trade the 0% loan for a lower price. This is because the 0% loan comes from the finance wing of the car manufacturer and not from the dealership. The dealer may not care if the finance folks make their quota of loans or not.
|
+1
No reason you shouldn't give it a shot but I doubt you'll see any positive results.
__________________
Numbers is hard
|
|
|
08-23-2011, 04:54 PM
|
#10
|
Full time employment: Posting here.
Join Date: Nov 2009
Location: VA
Posts: 923
|
Quote:
Originally Posted by LOL!
We did take a 0% loan for the last car we bought. We also got the rebate. Just because of that, I think we paid too much for the car.
You may not get anywhere trying to trade the 0% loan for a lower price. This is because the 0% loan comes from the finance wing of the car manufacturer and not from the dealership. The dealer may not care if the finance folks make their quota of loans or not.
|
A 0% finance rate will be a factory incentive, not a finance-wing incentive. There is almost always a cash rebate available instead of the 0% financing.
__________________
Disclaimer - I am an independent insurance agent. If the above message contains insurance-related content, it is NOT intended as advice, and may not be accurate, applicable or sufficient depending on specific circumstances. Don't rely on it for any purpose. I do encourage you to consult an independent agent for insurance-related advice if you have a question that is specific in nature.
|
|
|
08-23-2011, 05:01 PM
|
#11
|
Full time employment: Posting here.
Join Date: May 2007
Posts: 549
|
MickeyD ~ the BIG question is....
Whatcha buyin'
Sienna? Venza?? Avalon??
|
|
|
08-23-2011, 05:23 PM
|
#12
|
Recycles dryer sheets
Join Date: Sep 2010
Location: Montgomery
Posts: 74
|
Have you taken a look at USAA's car buying service? Several of my friends are very happy with it. USAA does all the research/negotiation and you just walk into the dealership and pay. I guess if the price they've negotiated is higher than what you found, you can just walk away. I think it's worth a look.
|
|
|
08-23-2011, 05:32 PM
|
#13
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2002
Location: Texas: No Country for Old Men
Posts: 50,021
|
I used USAA's buying service earlier this year to buy my truck and was very happy with the deal. I paid less than the price Edmund's said was the going rate and enjoyed not having to spend hours engaging in tag-team negotiations with the salesman and his manager.
__________________
Numbers is hard
|
|
|
08-23-2011, 05:41 PM
|
#14
|
Moderator Emeritus
Join Date: May 2007
Posts: 12,901
|
I used USAA's buying service to buy 2 cars last year. I was very happy with it. No surprises.
|
|
|
08-23-2011, 05:42 PM
|
#15
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Apr 2004
Location: South Texas~29N/98W Just West of Woman Hollering Creek
Posts: 6,674
|
Quote:
Originally Posted by Pajaro
Have you taken a look at USAA's car buying service? Several of my friends are very happy with it. USAA does all the research/negotiation and you just walk into the dealership and pay. I guess if the price they've negotiated is higher than what you found, you can just walk away. I think it's worth a look.
|
Yes I went thru AutoCircle @ USAA (going directly to the fleet mgr is much easier), but that does not stop me from trying to negotiate a bit if I can.
__________________
Part-Owner of Texas
Outside of a dog, a book is man's best friend. Inside of a dog, it's too dark to read. Groucho Marx
In dire need of: faster horses, younger woman, older whiskey, more money.
|
|
|
08-23-2011, 06:09 PM
|
#16
|
Thinks s/he gets paid by the post
Join Date: Oct 2004
Location: LaLa Land
Posts: 4,698
|
Quote:
Originally Posted by dgoldenz
A 0% finance rate will be a factory incentive, not a finance-wing incentive. There is almost always a cash rebate available instead of the 0% financing.
|
Last year Toyota was running the O% program on Camrys. There is no games with this program and it's from Toyota direct and not from the dealer.
Many times it's the rebate or the low rate but not in this case.
__________________
Work is something you do to get enough $ so you don't have to....Me.
|
|
|
08-23-2011, 06:18 PM
|
#17
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Apr 2004
Location: South Texas~29N/98W Just West of Woman Hollering Creek
Posts: 6,674
|
Quote:
Many times it's the rebate or the low rate but not in this case.
|
That's what the fleet mgr told me too, but I tend to not believe what those guys say. I guess I now have to believe it if its from a fellow ERer.
__________________
Part-Owner of Texas
Outside of a dog, a book is man's best friend. Inside of a dog, it's too dark to read. Groucho Marx
In dire need of: faster horses, younger woman, older whiskey, more money.
|
|
|
08-23-2011, 06:38 PM
|
#18
|
Thinks s/he gets paid by the post
Join Date: Oct 2004
Location: LaLa Land
Posts: 4,698
|
Quote:
Originally Posted by mickeyd
That's what the fleet mgr told me too, but I tend to not believe what those guys say. I guess I now have to believe it if its from a fellow ERer.
|
Don't be so sure, I spent 35 years in the car biz.
__________________
Work is something you do to get enough $ so you don't have to....Me.
|
|
|
08-23-2011, 06:57 PM
|
#19
|
Recycles dryer sheets
Join Date: Dec 2008
Posts: 299
|
Quote:
Originally Posted by dgoldenz
There is almost always a cash rebate available instead of the 0% financing.
|
Almost, not always. When I bought my car, there was 0% financing but no rebate if I didn't take financing. So I took the loan.
|
|
|
08-23-2011, 07:18 PM
|
#20
|
Thinks s/he gets paid by the post
Join Date: May 2008
Location: Cooksburg,PA
Posts: 1,874
|
Once I was given a $500 rebate for taking out a loan. Promptly paid it off a month later.
__________________
Free to canoe
|
|
|
|
|
Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
|
|
Posting Rules
|
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts
HTML code is Off
|
|
|
|
» Recent Threads
|
|
|
|
|
|
|
|
|
|
|
|
|
» Quick Links
|
|
|