0% APR 84 mo Coronavirus deals?

[Kiai]

Most of the ad language reads about the same across the nation, but can't find these answers. 

 

Have the prices of the cars been raised to accommodate that deal?

Do you know if they include early pay off penalties?

 

Thanks

[IndyPoolPlayer]

The only auto finance companies that I'm aware that have early payoff penalties are scumprime lenders whose names contain the word "acceptance".

 

The problem with 84 month (that's 7 years, or 23% of a 30 year mortgage) financing is the vehicle will be worn out and worthless before you're done paying for it.

[hegemony]

if you need to finance for more than 36 months, even at "zero" percent then you're buying too much vehicle and putting yourself in an upside-down situation for years.

[Kiai]

Oh, thanks!

I just wanted to get in on the 0% Apr which I'm not finding on shorter loans. That's why I asked about early payoff, so I have the choice to pay as soon as I want.

They just don't let you see that part before apping. Still thinking about it though.

[cv91915]

In general the 0% deals that are being advertised are from the manufacturers' captive finance companies.  I would be really surprised if any of those offers had a prepayment penalty.

 

It's possible that in your market you'll see 0% long-term financing but no rebates, where two months ago there were no APR offers but customer rebates and dealer incentives worth three times the extra interest you'd pay at the higher APR.

 

Bottom line, like any other time, get a car if you need one.  If you don't, wait, especially if you have a trade-in. 

 

Used car values are dropping, so any savings you hoped to achieve from cheap financing may have already been erased (and then some) by the drop in your current vehicle's value (which may be temporary).

 

[centex]

22 hours ago, Kiai said:

Most of the ad language reads about the same across the nation, but can't find these answers. 

 

Have the prices of the cars been raised to accommodate that deal?

Do you know if they include early pay off penalties?

 

Legitimate lenders don't have pre-payment penalties. 

 

What you are apt to see, with respect to deals, is that this three-months deferred stuff is basically replacing the rebates that used to be all over the place.  Negotiating a price is still something that some people are capable of doing while others remain victim's of the four-box con...

 

Bottom line is that a price either makes sense to the individual consumer and a deal is consummated OR it makes no sense and the consumer walks out the door....

[MarvBear]

If a captive offered a 0% APR loan for a term up to 84 months, there would be no restrictions to write the contract for a shorter term.  So you could easily have the finance person just change the terms for 84 to 36.   Very simply, just a couple clicks.

[Kiai]

11 hours ago, MarvBear said:

If a captive offered a 0% APR loan for a term up to 84 months, there would be no restrictions to write the contract for a shorter term.  So you could easily have the finance person just change the terms for 84 to 36.   Very simply, just a couple clicks.

Thank you so much! I didn't know that, well obviously! ha

[CTSoxFan]

On 4/19/2020 at 2:57 PM, hegemony said:

if you need to finance for more than 36 months, even at "zero" percent then you're buying too much vehicle and putting yourself in an upside-down situation for years.

I think the key word here is need.  I would argue your money is better spent earning a return than buying the car outright (or paying it in a shorter term).  I would utilize every bit of the free money I could, especially if you are intending to keep it for that long anyway.  Upside-down is not an issue if you have the means to extract yourself from it.   

 

The problem is going to come when someone who could afford a $20k car buys a $40k car because they can get a low payment and then something happens...