Financing End of the line for zero financing?

[ultrarunner]

To bad it is a slippery slope to live beyond one's means or even gamble.

I use credit as I have a first mortgage (at 2.75%) and use charge cards that are paid in full monthly.

Many of the low or no interest rate offers comes with strings like shadow interest due should any payment be late... quite a shock to one person I know that bought furniture on time and totally legitimate.

 

[Will_C]

I went with the 0% on the last 2 Kubotas I bought. Both times I offered cash and the dealer told me he could not do any better if I paid cash. I also ran into the same thing when I bought my last Toyota truck-The price was the same cash or financed. I did buy a Toyota car 3 years ago-I had the choice of $1500 cash back with 0% interest or $750 cash and 2.5% interest. I took the 2.5% and paid for 2/3 of the car in cash.

 

[ultrarunner]

I expect as interest rates rise the options will narrow...

Never in my life did I think I would have a 2.75 15 year fixed no cost home mortgage... it is just to attractive to let go so I do understand.

 

[timswi]

Yea, I never found a dealer willing to offer anything off for cash.

Matter of fact, last car I bought last yr, I was going to pay cash, and was told the price would be higher if paying cash, that their offer was based on their financing, at 0%... Of courses I financed with them at 0%.

Yes that is absolutely true. The dealer recives a reserve off of the financing and if you're not paying that, it gets added back into the purchase price--they are not going to eat that. I've known people who negotated deals on new trucks and have the dealer refuse to sell it at that price when notified they were paying cash..I tell everyone who is paying cash, finance it and pay it off on the first payment..You pay a few bucks in interest fo a month or so but no where near the price increase incurred...Also never walk into a dealer and say I'm paying cash..You already lost...Referring to car dealers mostly here.

 

[sixdogs]

Yes that is absolutely true. The dealer recives a reserve off of the financing and if you're not paying that, it gets added back into the purchase price--they are not going to eat that. I've known people who negotated deals on new trucks and have the dealer refuse to sell it at that price when notified they were paying cash..I tell everyone who is paying cash, finance it and pay it off on the first payment..You pay a few bucks in interest fo a month or so but no where near the price increase incurred...Also never walk into a dealer and say I'm paying cash..You already lost...Referring to car dealers mostly here.

That's pretty clever. Finance but pay off on the first payment.

 

[ultrarunner]

Just jumping through the hoops to get the desired result.

 

[MessickFarmEqu]

Yes, dealers get kick backs for financing.
The longer the term the bigger the perk.

Completely and totally untrue. Its of no difference to us if you pay cash or finance unless your choosing a rate that requires participation on our part. In no case have I ever seen any tractor company pay the dealer for contracts.

 

[timswi]

That's pretty clever. Finance but pay off on the first payment.

The only bad part about this, depending on your point of view, is that the financing company will usually recourse the dealer for the reserve earned on your deal...The dealer might remember that next time, or not....There is usualy a time that the account has to stay open before the recourse aspect matures...Depends on the financing company--Guessing 90 days or so if you like the dealer.

 

[Tractor Seabee]

Look close at the fine print; some finance contracts have a penalty for early pay off.

Ron

 

[quotejso]

I went with the 0% on the last 2 Kubotas I bought. Both times I offered cash and the dealer told me he could not do any better if I paid cash. I also ran into the same thing when I bought my last Toyota truck-The price was the same cash or financed. I did buy a Toyota car 3 years ago-I had the choice of $1500 cash back with 0% interest or $750 cash and 2.5% interest. I took the 2.5% and paid for 2/3 of the car in cash.

Why not take the extra $750, could have payed it off either way?