Financing How much does 0% cost?
- Thread starter TXSQBALER
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ispan1
Bronze Member
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- Finger Lakes, NY
- Tractor
- Kubota l245, Ferguson TEA-20, Farmall Cub (Sold...Play taps in your head)
I figure you lose the 1000 cash rebate plus I would have to buy Kubota insurance for another 1000 (not really worth much to me as I don't think I'll probably lose my tractor to theft or tsunami in this lifetime) on a close to $20000 otd l3700 I have been pondering. That's not too bad considering financing that amount at 6 or 7% would cost a couple of grand more over the life of the loan.
bp fick
Super Member
That's the math that needs to be done. $750 or $1000 can be computed against your loan and you can decipher what you paid to buy down your interest rate to zero. 1%-2% seems to be average under the current programs.
Kubota Finance does NOT demand you use Kubota Insurance if you can document that the their loan is protected by your own insurance. I did not use the insurance the first time, but did the second time. We changed homeowner companies and I simply did not like the new coverage provided at all. Kubota insurance is a very comprehensive product.
JOHNTHOMAS
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- Somerset, Ky
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- F2690 4WD RTV X1140 MX5400 HST ZD1211
Your surely wrong. The dealer does not participate, doesn't have to. The tractors are "mostly" Kubotas that are on dealers lots. A few under certain circumstances in time are owned by the dealers.
The cash discount now being offered for cash comes from Kubota and is a fixed amount depending on the model tractor. A $10,000 or $20,000 B model is $700. Dealers have a cost price from Kubota so they can sell it for no profit or as much profit as they feel they want to make. Financing has nothing to do with it for the dealer, doesn't cost him nor pay him unless it's a few bucks for doing the paper work which would let the dealer actually make more by financing instead of cash.
Those whopping/steep cash discounts your speaking of are not based on cash over financing except for the Kubota dollar amount. Maybe your calling the $700 and $1000 published amounts as whopping/steep, if so, then you are right on that part but not the dealer incentive/participation part.
JOHNTHOMAS
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I chose the Kubota Insurance on the RTV that will be off my property but not on any of the other tractors because my home owners covers me for the MOST part, no, not as good as the Kubota Ins but at no additional cost.
Thanks to everyone who chimed in. I was not referring to the Kubota factory rebate. My dealer gave me around a 10% discount off list price plus the 0% Kubota financing.
I saw another dealer advertise an MX4700 for 26% off list price but CASH ONLY, which is why I rightly assumed the zero per cent gimmick costs you something as it should. That being said, it's real convenient to get your financing and tractor at the same place. I took home a $65,000 machine with just a signature (and big payment). Actually they delivered it for free.
I saw another dealer advertise an MX4700 for 26% off list price but CASH ONLY, which is why I rightly assumed the zero per cent gimmick costs you something as it should. That being said, it's real convenient to get your financing and tractor at the same place. I took home a $65,000 machine with just a signature (and big payment). Actually they delivered it for free.
JOHNTHOMAS
Super Member
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- 7,719
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- Somerset, Ky
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- F2690 4WD RTV X1140 MX5400 HST ZD1211
Your right, it does cost you some thing. The amount of the cash discount given by Kubota.
I think your still missing the mark. 10% is considered an average/OK discount by many dealers and some do more and that's cash or financed.
I believe the one your telling about CASH ONLY price is because of the Kubota cash discount. I believe if you had went to their store they would have explained that is the price with the Kubota cash only discount and financed would have been more by the amount of the Kubota cash discount. Dealers make the same amount of profit whether it's cash or financed. They sell the tractor and Kubota sends them their money. I don't think you believe that but it's true. When the dealer processes the transaction cash or finance, he gets the same amount of money. It's not like car lots where the cars are floor planned. Kubota has a different system. The dealer usually has no money in most of the new tractors on their lot. They do some times on some but mostly they don't.
