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  1. #1
    Super Member JOHNTHOMAS's Avatar
    Join Date
    Apr 2008
    Posts
    5,524
    Location
    Somerset, Ky
    Tractor
    currently own F3080 F2680 B2620 FEL/BH RTV1140

    Default 0% was but is no longer truly 0%

    A few months ago kubota started having a financed price and a cash price. Before that for quite awhile it was the same price cash or financed so back then 0% was truly 0%. With the cash discount then 0% financed price is no longer a true 0%.
    I just ordered a B2320 financed at 0% for 60 months. If I had paid cash it would have been $700 cheaper. That works out to about 4% interest on the tractor I ordered. The discount is based on the tractor or RTV being sold. These machines can be $10000 apart with different models in the same series or with options. This means I paid a higher interest rate because I bought the least expensive model in the B series. If I had bought the B3030 with FEL MMM canopy and other attachments the interest rate would have equaled 2% or less. So, the amount financed vs the discount for that series tractor will determine the true cost of borrowing their money
    This has been discussed before but it's different now than before because there is now an across the board discount for cash that was not there before.
    In most cases the 0% interest for 60 months is still a good deal but take all of it (Finance the entire purchase and use your down pmnt for something else) to make it the best deal.
    2012 B2620 FEL BH, 2008 F2680 2WD 72" side Discharge Deck, 2012 F3080 4WD 72" rear discharge deck, 2010/2009 RTV1140CPX , RatchetRake, Forks, ...DEARBORN 2 BOTTOM PLOW 12" ?? FOR SALE $425).... Drawbar and Horse Drawn disk 13 Toyota Tacoma Double Cab, 13 Ford Flex. 2009 Subaru Impreza Sport

  2. #2
    Elite Member
    Join Date
    Dec 2007
    Posts
    2,920
    Location
    texas
    Tractor
    7040 HDC 1153 fel

    Default Re: 0% was but is no longer truly 0%

    Quote Originally Posted by JOHNTHOMAS View Post
    A few months ago kubota started having a financed price and a cash price. Before that for quite awhile it was the same price cash or financed so back then 0% was truly 0%. With the cash discount then 0% financed price is no longer a true 0%.
    I just ordered a B2320 financed at 0% for 60 months. If I had paid cash it would have been $700 cheaper. That works out to about 4% interest on the tractor I ordered. The discount is based on the tractor or RTV being sold. These machines can be $10000 apart with different models in the same series or with options. This means I paid a higher interest rate because I bought the least expensive model in the B series. If I had bought the B3030 with FEL MMM canopy and other attachments the interest rate would have equaled 2% or less. So, the amount financed vs the discount for that series tractor will determine the true cost of borrowing their money
    This has been discussed before but it's different now than before because there is now an across the board discount for cash that was not there before.
    In most cases the 0% interest for 60 months is still a good deal but take all of it (Finance the entire purchase and use your down pmnt for something else) to make it the best deal.
    i found that out in oct when i bought my tractor.i was going to finance though kubota for 5yrs at 0 0 0 but was turned down because i didnt have any credit.mainly because i pay cash or borrow from the bank.my total price was $25,995.so i called my banker an told her what i was doing an she said write the check.my intrest for 5yrs at bank was $2000,so i offered my kubota dealer $24,000 an after 20mins of checking they took my off.an i save the $2000 in intrest at the bank because i knocked it off the tractor price.

  3. #3
    Elite Member
    Join Date
    Sep 2003
    Posts
    4,142
    Location
    New Brunswick, Canada
    Tractor
    Kubota L5030 HSTC, MF 5455

    Default Re: 0% was but is no longer truly 0%

    Always been a cash rebate up here.

  4. #4
    Elite Member
    Join Date
    Dec 2003
    Posts
    3,956
    Location
    NC
    Tractor
    Kubota Grand L3830

    Default Re: 0% was but is no longer truly 0%

    There never has been free money on automobile or tractor purchases. The only free money is money the Banks borrow from the Federal Reserve to make high interest consumer loans with. The cost of an automobile or tractor is increased by the respective manufacture to include an actuarial loan default amount, a good interest return on money plus a projected annual corporation income growth rate. Most corporations set this at 6%. They then find a Bank or Finance Company to handle the paper work and provide the loan. The Corporation agrees to “Buy Back” or “Take Back” all defaults. Now we are ready to sell our $8,000 dollar tractor. So we increase the price too $14,000. The $14,000 dollar price will provide 0% percent financing for five (5) years; factor in a projected six (6) percent annual growth rate, an interest rate of 5-6% on the loan amount and defray out of pocket cost for all the “Buy Backs” or “Take Backs” because of loan defaults and provide a hefty profit percentage at time of sale. So the cost of the $8,000 dollar tractor has now increased to $14,000, a 75% increase in cost so the tractor can be sold at 0% for X number of years. Good Golly what a deal, where do I sign? I have just got to have one, come on break out the paper work.

    Dealers with a high number of “Take Backs” or “Buy Backs” are being dropped in record numbers by manufactures. The “Buy Backs” or “Take Backs” due to loan defaults are having a negative impact on the manufactures bottom line profit projections and cannot be tolerated I don’t care how long the dealer has been in business. The high number of “Buy Back” or “Take Back” is also resulting in annual double digit price increases. The consumer will only swallow so many times the story about price increases are because of an increase in steel, rubber or plastic prices and manufactures know this.

    Our job and financial economy was strong before we started having alleged 0% percent sales. Look at it now it is somewhere south of the deepest hole.

    A lot of consumers have started objecting to having to pay an elevated price for a product so a Manufacture or Dealer can offer 0% percent sales. This is reducing the number of Dealers even more, and at the same time increasing unit prices and repair parts prices. A part that cost $5.00 five years ago today costs $10.00. Look at all the money we are saving by purchasing items at 0%.

    So before we make a 0% purchase we need to explore other alternatives to paying besides obtaining a 0% percent loan.

  5. #5
    Super Member bp fick's Avatar
    Join Date
    Aug 2009
    Posts
    5,414
    Location
    Beaver Creek, Northern Michigan
    Tractor
    Kubota BX2360

    Default Re: 0% was but is no longer truly 0%

    Yup, it's really 4%, give or take. But.....kubota and others aren't going to carry zero forever.

    Those of us who remember 17% consumer loans, ie; auto, boat loans, find money rates to be incredibly low. Whether it's zero, 1%,2%, 4% it is what it is and that is cheap. What's your passbook savings paying these days? Zip!

    I remember coming out of the Carter administration with 22% prime rate, that when consumer loans finally fell to around 11% we were all rejoicing.

    With the threat of hyper inflation always looming, in a few years, someone might just look back at these rates and declare them "the good old days". Could happen.
    BP


    "Some chickens, some gardens and a Kubota."

  6. #6
    Super Member grsthegreat's Avatar
    Join Date
    Jan 2011
    Posts
    6,363
    Location
    north idaho
    Tractor
    dk45se hst cab

    Default Re: 0% was but is no longer truly 0%

    I was offered the great 0% finance thru some dealers when i was shopping for a tractor, but they dont haggle on the prices when you finance, so 0% is not 0%.

    When i bought my Kioti i came in with cash, was able to get a REAL deal off of sticker price.

    so cash is LESS than 0% hehe

    I refuse to ever have a mortgage or payment due again. the wife and i are debt free and plan on staying that way. If we cant afford it in cash, it doesnt get purchased.

    This has kept us afloat in these troubled times.

    I also paid cash for my 2004 ford f350 almost 2 years ago, and got it at a ridiculously low price.
    currently own
    2011 Kioti DK45SE HST CAB tractor/loader, Jimna 6" - 3 point wood chipper, 60" JD Brush Hog, JD 60" Rototiller, 3 point post hole digger with hydraulic assist, 3 point spring tooth rake, Fimco 55 gallon weed sprayer with 12 foot boom, 3 point hydraulic wood splitter (home built)
    Quick Attach 79" loader mount snowblower & rear powerpack
    Quick Attach 84" Snow Blade
    Quick Attach 42" pallet forks

  7. #7
    Silver Member ejkessler's Avatar
    Join Date
    May 2010
    Posts
    151
    Location
    North Central Ct
    Tractor
    Kubota Cab L3940, FEL 724 QA, BH92

    Default Re: 0% was but is no longer truly 0%

    Overall I agree and see where everyone is coming from. My story is that about 2 1/2 months ago when I realized 2/3 the way through this last winter I needed a cab I started my search. After contacting 7 dealerships over about a month I settled in on working with White's Tractor in New York. Throughout this time the L series tractors were only offering 0% for 48 months. I needed to extend that to decrease my payment and was going to go with the advertised 3.49% for 60 months much to my initial chagrin. Fortunately there was a delay in the arrival of some parts for the way I wanted it built from the weather. During that 1 week delay the financing went from 3.49% to 0% for 60 months and my payment dropped right at 10%. The cost of the financing at 3.49% for the balance of my trade for right at 35K was going to be about 3400.00 added to the note for interest. The deal did not change for me with the financing drop. I know there are many variables as very well laid out earlier in this thread. Straight cash deals are great when there aren't trades involved and you do have the money. Most of the banks around here aren't going to loan for most of these kinds of purchases for much less than 5 to 7% and often times higher, at least that has been my experience. Even if the cost of the loan was covering up a 1000.00 to 1500.00 buffer factor, it is still dirt cheap money Relatively speaking. As was stated earlier I still remember the late 70's and early to mid '80's and the interest rates at that time. Don't want to see that again. Just my opinion, nothing more or less.
    Life's to short not to own a tractor

    Kubota L3940 HSTC-3
    723 FEL QA, R4's, BH92 18" and 12" buckets
    Land Pride tiller, Sitrix Spreader
    Land Pride Grader blade, York Rake
    B74 Blizzard 3pt blower, HD Country line PHD
    3pt Bale Spear, Middle Buster, more misc.

  8. #8
    Veteran Member Wacky's Avatar
    Join Date
    Apr 2010
    Posts
    1,076
    Location
    West Virginia
    Tractor
    2010 GC2610

    Default Re: 0% was but is no longer truly 0%

    I have never seen "truly" 0%. You ALWAYS pay for it somehow.
    2010 MF GC2610--MF60"MMM--King Kutter XB 4' rotary cutter-- 4' King Kutter XB boxblade-- Ratchet Rake-- Check that parking brake

  9. #9
    Super Member bp fick's Avatar
    Join Date
    Aug 2009
    Posts
    5,414
    Location
    Beaver Creek, Northern Michigan
    Tractor
    Kubota BX2360

    Default Re: 0% was but is no longer truly 0%

    Yup, most of the posters here have pretty good, calm, wisdom.

    Zero to 4 % is what it is. Cheap. OK, quibble over whether it is truly zero or if 4% is buried in the price. It is what it is. One always looks at total cost of purchase, not just price, but price plus........ delivery, financing costs, sales tax, etc. Look at the total.

    But we can and do all seem to agree, if we are old enough to remember, what 22% prime rate looks like on consumer loans. I hope to God I don't live through that scenario again. Cash is great. My wife and I now live on a cash basis. But it took us a life time to get here. Without auto financing, years ago, we'd have walked to work. Not really. It was too far.

    Couldn't have bought our homes without mortgages either. Glad all that is behind us. I wonder what the younger generations will have to face.
    BP


    "Some chickens, some gardens and a Kubota."

  10. #10
    Super Member two_bit_score's Avatar
    Join Date
    Dec 2008
    Posts
    6,837
    Location
    Texas -from the brush and pear to the piney woods
    Tractor
    110 TLB

    Default Re: 0% was but is no longer truly 0%

    0% is kinda like a 'free' lunch. It ain't. Really.

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