Many car manufacturers are now offering 0% or low-rate financing and the offer seems almost too good to be true. While low-rate financing offers may sound attractive, be careful before choosing this option. Let’s take a look at some facts.
First of all; these 0% financing offers are available on selected models of new vehicles. And that specific model of new vehicle may not fit your particular needs and budget. And even at a lower rate, a new vehicle will usually cost you a lot more.
Further; 0% Financing is usually only for qualified buyers with very high credit scores, and for shorter terms. What does this mean? If you do want that vehicle and you do qualify, your payment may be too high.
And, in most cases, by accepting the “special rate”, you will be giving up a substantial rebate. In almost every instance that special financing is offered through a manufacturer, the buyer usually has to choose between the low finance rate and a considerable rebate. When you choose the rebate, that amount is immediately subtracted from your selling price (and taxable amount). And it is often better to take the rebate and finance the lower amount even at the higher rate. The full savings are immediate; no risk, no wait!