Financing Cash Purchase versus 0% Financing

[JOHNTHOMAS]

I don't believe there is any such critter as 0% financing ... I was quoted a price the other day on a piece of equipment and then told to add 14% if I decided to take the financing ... it appears to be built in the price.

So ... use my cash to buy it and did I just earn 14% on my money???

There was such a thing as 0% financing. When a Kubota (were you talking about a Kubota dealer on a new tractor?) dealer told you what he/she would take for a tractor just a few months ago there was no more or less if you took the 0% financing. Recently Kubota started giving some discounts for cash. On my recent purchase it was $700 for cash.
In a recent thread concerning is there really 0% financing it was told that the Japanese government was loaning the money to Kubota and probably other businesses for 0%.
I know, here comes the you know it's built into the price and it may very well be but you can't extract it from the purchase. Those of us that take the 0% gain from those that pay cash. You cash payers, keep it up. Pay cash, don't finance.:thumbsup:

 

[unbidden]

There was such a thing as 0% financing. When a Kubota (were you talking about a Kubota dealer on a new tractor?) dealer told you what he/she would take for a tractor just a few months ago there was no more or less if you took the 0% financing. Recently Kubota started giving some discounts for cash. On my recent purchase it was $700 for cash.
In a recent thread concerning is there really 0% financing it was told that the Japanese government was loaning the money to Kubota and probably other businesses for 0%.
I know, here comes the you know it's built into the price and it may very well be but you can't extract it from the purchase. Those of us that take the 0% gain from those that pay cash. You cash payers, keep it up. Pay cash, don't finance.:thumbsup:

I think(?) this may be dealer related rather than a Kubota issue. I first went to the local Mahindra dealer; Mahindra was also offering 0% but I was told the price would be an added $1,000 if taking the 0%. If I opted for other financing, even from Mahindra the added cost was not applicable. I left, went to a Massey dealer, didn't like their options either. Kubota was much more buyer friendly.

 

[TripleR]

There was such a thing as 0% financing. When a Kubota (were you talking about a Kubota dealer on a new tractor?) dealer told you what he/she would take for a tractor just a few months ago there was no more or less if you took the 0% financing. Recently Kubota started giving some discounts for cash. On my recent purchase it was $700 for cash.
In a recent thread concerning is there really 0% financing it was told that the Japanese government was loaning the money to Kubota and probably other businesses for 0%.
I know, here comes the you know it's built into the price and it may very well be but you can't extract it from the purchase. Those of us that take the 0% gain from those that pay cash. You cash payers, keep it up. Pay cash, don't finance.:thumbsup:

If I remember correctly and for me that is an iffy thing at best, there have been true 0% interest loans, but the 0% expires and another is introduced which may or may not be truly 0%. I believe that is the cause for confusion.

Financing is often made more confusing by the salesman than it should be; seen it first hand as a customer and from my son who was a salesman and son in law whose father owns a dealership.

Overall this has been a very interesting thread. Not all of us who pay cash lose money by doing so when business expenses, taxes, depreciation are figured in. As I have said previously, we were going to do the 0% on our M8540 until all aspects were considered including the lower price by paying cash. Of course I and my financial adviser are considered by some as "rank amateurs.

 

[Mike Costello]

The best way to eliminate the dealer from hedging his price is to nail down the price first and then talk financing. If the dealer doesn't play ball, move on.

 

[TripleR]

The best way to eliminate the dealer from hedging his price is to nail down the price first and then talk financing. If the dealer doesn't play ball, move on.

That is what I usually do and don't mention a trade in.

 

[Dr_Zinj]

Yeah, people who pay their bills promptly, save their money and pay cash for big ticket items, and stay within their budgets are poor financial risks.

No wonder our country is going down the tubes.

 

[rjkobbeman]

I don't believe there is any such critter as 0% financing ... I was quoted a price the other day on a piece of equipment and then told to add 14% if I decided to take the financing ... it appears to be built in the price.

So ... use my cash to buy it and did I just earn 14% on my money???

In your case paying cash is the smart thing to do. In some cases, there is little or no difference between paying cash or financing.

In my case, my dealer gave me his price and said it did not matter if I paid cash or financed... the price is the same. He said the dealer does not make out better one way or the other.

Not long after I purchased (financed), Kubota started offering some rebates in lieu of financing... however the dealer's price (not counting factory rebate) would not change based on cash or financing.

So... in some cases, yes, there is 0% financing.

 

[blueriver]

In your case paying cash is the smart thing to do. In some cases, there is little or no difference between paying cash or financing.

In my case, my dealer gave me his price and said it did not matter if I paid cash or financed... the price is the same. He said the dealer does not make out better one way or the other.

Not long after I purchased (financed), Kubota started offering some rebates in lieu of financing... however the dealer's price (not counting factory rebate) would not change based on cash or financing.

So... in some cases, yes, there is 0% financing.

I feel that is the way I feel it should be ... get the best price. Should not matter cash or financed.

 

[BXpanded]

Ran into an interesting one last week... The GMC Dealer tells me a particular vehicle offers a $1500 rebate with 0% financing for 36 months. No rebate if you pay cash! I didn't believe it 'till I read the sheet myself. Just the opposite of the expected upcharge or 0% financing. Rebate was only offered with the 36 months term. No, I didn't buy it. Just tire kickin'.

 

[smstonypoint]

Ran into an interesting one last week... The GMC Dealer tells me a particular vehicle offers a $1500 rebate with 0% financing for 36 months. No rebate if you pay cash! I didn't believe it 'till I read the sheet myself. Just the opposite of the expected upcharge or 0% financing. Rebate was only offered with the 36 months term. No, I didn't buy it. Just tire kickin'.

This may help explain why GM had to take the bailout.



Steve