0% Financing

[ridgebackpilot]

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@Anonymous wrote:

I'm curious about this as well. My auto scores are 750+ on all bureaus and scoring versions. How much higher do I need to get it up before 0% is an option?

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 Your scores should be plenty high enough. Ford Motor Credit approved me for 0% financing twice with slightly lower scores. If anything, they seem more interested in DTI ratio than credit scores. But even then, these manufacturers want to sell cars so they are pretty willing to approve you for subsidized financing, especially nowadays!

[Anonymous]

i financed a 450h a few years ago and I think my auto score was 680 at the time. the dealer said they moved me up to the next tier and i got the special rate at the time.

[Watchmann]

I bought a new Ford Focus ST in September 2015 and they were advertising 72 months, 0% financing.  I also had an old Buick LeSabre that we had inherited from my wife's dad, it was just easier to value the car beforehand and put that into the mix.  Negotiated down on the MSRP and they took the used car in trade at the value I wanted.  No issues, no gimmicks.  Sat down with the finance guy and did the paperwork in 20 minutes. Never heard 'you must pay MSRP to get the 0% financing' line.  If a dealer pulled that I'd get up and leave.  With interest rates at close to zero the car manufacturers can offer 0% to move the iron off the lot.  They don't make money on the financing but sometimes you have to just keep the money flowing to keep the lights on and hope for bigger profits on trucks and SUVs.  I've got a little over a year to go on the loan, it's set up for autopay every month.....eezy peezy.

[adelphi_sky]

I am looking at buying a used vehicle soon. I have time. THere is no rush. Right now, I a looking at either an Audi or a Mercedes CPO. What are the chance of getting 0% financing on a CPO luxury vehicle? In addition, my DTI ratio will be 0 and my credit score in the upper 700s at the time of purchase? I can also consider a 48-month term as opposed to a 60+ month term which might be looked on more favorably. 

My current thinking is that the economy will continue to get worse, my buying position may improve as dealers get more desperate to offload vehicles. Like I said, I have time to wait things out. I want to be in the best position possible and to take advantage of the economic downturn. 

[Gladius]

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@adelphi_sky wrote:

I am looking at buying a used vehicle soon. I have time. THere is no rush. Right now, I a looking at either an Audi or a Mercedes CPO. What are the chance of getting 0% financing on a CPO luxury vehicle? In addition, my DTI ratio will be 0 and my credit score in the upper 700s at the time of purchase? I can also consider a 48-month term as opposed to a 60+ month term which might be looked on more favorably. 

My current thinking is that the economy will continue to get worse, my buying position may improve as dealers get more desperate to offload vehicles. Like I said, I have time to wait things out. I want to be in the best position possible and to take advantage of the economic downturn. 

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I always heard the 0% specials were only for new cars.  That may change in the near future.

[ridgebackpilot]

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@adelphi_sky wrote:

I am looking at buying a used vehicle soon. I have time. THere is no rush. Right now, I a looking at either an Audi or a Mercedes CPO. What are the chance of getting 0% financing on a CPO luxury vehicle? In addition, my DTI ratio will be 0 and my credit score in the upper 700s at the time of purchase? I can also consider a 48-month term as opposed to a 60+ month term which might be looked on more favorably. 

My current thinking is that the economy will continue to get worse, my buying position may improve as dealers get more desperate to offload vehicles. Like I said, I have time to wait things out. I want to be in the best position possible and to take advantage of the economic downturn. 

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I've never before seen the kinds of financing deals that car dealers and manufacturers are offering today! Zero percent financing together with deferred payments are now commonplace for new cars. They really seem desperate to sell cars, except Tesla which still isn't offering zero percent on its new vehicles. You're right to wait; the deals may just keep getting better over time!

Like @Gladius, I've never seen zero percent financing offered for CPO vehicles. The best I could get on my CPO Mercedes GLE350 was 1.9% over 36 months. Mercedes is now offering zero percent financing for their new cars, but also only for short-term loans. But of course that could change if they have trouble selling CPO cars...

By the way, you're smart to look at CPO vehicles, especially for luxury brands like BMW and Mercedes. CPO is one of the best deals available thanks to the extended warranty and good financing incentives.

[adelphi_sky]

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@ridgebackpilot wrote:

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@adelphi_sky wrote:

I am looking at buying a used vehicle soon. I have time. THere is no rush. Right now, I a looking at either an Audi or a Mercedes CPO. What are the chance of getting 0% financing on a CPO luxury vehicle? In addition, my DTI ratio will be 0 and my credit score in the upper 700s at the time of purchase? I can also consider a 48-month term as opposed to a 60+ month term which might be looked on more favorably. 

My current thinking is that the economy will continue to get worse, my buying position may improve as dealers get more desperate to offload vehicles. Like I said, I have time to wait things out. I want to be in the best position possible and to take advantage of the economic downturn. 

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I've never before seen the kinds of financing deals that car dealers and manufacturers are offering today! Zero percent financing together with deferred payments are now commonplace for new cars. They really seem desperate to sell cars, except Tesla which still isn't offering zero percent on its new vehicles. You're right to wait; the deals may just keep getting better over time!

Like @Gladius, I've never seen zero percent financing offered for CPO vehicles. The best I could get on my CPO Mercedes GLE350 was 1.9% over 36 months. Mercedes is now offering zero percent financing for their new cars, but also only for short-term loans. But of course that could change if they have trouble selling CPO cars...

By the way, you're smart to look at CPO vehicles, especially for luxury brands like BMW and Mercedes. CPO is one of the best deals available thanks to the extended warranty and good financing incentives.

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Thanks. During the last recession in 2008, I was able to get a BMW 328i CPO with 0.9% financing. This recession is gearing up to be worse and my financial position 10 times better. We'll see. Car sales need to continue to decline though.

[Anonymous]

Yes it is a myth. I special ordered a 2016 Mustang GT and upon delivery negotiated $3,000 below the MSRP price. Generally, when a offer comes up you have the option of taking a 0% financing term or the cash rebate. Since the rebate was only $500 I took the 0% APR for 60 months. In 2019 I traded the car in for a 2019 Mustang Bullitt. Since it's a special edition car Ford won't offer 0% financing. So I got 3% through a CU for 72 month term.

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@ridgebackpilot wrote:

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@Anonymous wrote:

the way 0% works is that you have to buy at MSRP minus some incentives they might have like first responder or loyalty or whatever. you have to finance with the manufacturer financing. If you buy at a lower price with more incentives you have to finance with manufacturer financing at their higher rate. Sometimes you can find a middle price with your own cheaper financing.

Reason is the manufacturer gets less money for the car than the price you pay since no one lends money at 0%. The bank has to pay their investors a higher rate

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Nope! It's a commonly-held myth that "you have to buy at MSRP" to get zero percent financing. Dealerships would like you to believe that, but in reality nothing could be further from the truth. 

I've purchased several cars, most recently two Fords, with zero percent financing. One dealership told me I'd have to pay MSRP if I wanted zero percent APR. I walked out and found another nearby dealership that was perfectly willing to negotiate on price AND give me zero percent financing. Don't believe the myth that you can't have both!

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