What does 0% really cost?
Zero percent financing offers might sound great, but are they? Not always. If there’s a manufacturer’s rebate, don’t give it up in lieu of zero percent financing. It may cost you more in the long run. Compare the cost of a $20,000 vehicle with a loan term of 36 months:
| EFCU | Manufacturer | |
| Interest Rate | 4.25% | 0% |
| Manufacturer's Rebate | $3,000 | none |
| Amount to Finance | $17,000 | $20,000 |
| Total Interest Paid in 3 years | $1,138 | $0 |
| Total Payments | $18,138 | $20,000 |
| Financing with EFCU saves you... | $1,862 | |
And, even if you don’t give up the rebate, it can still cost you. Experts warn that when consumers get good financing - and many believe 0% is the best deal available - they don't negotiate on price. As a result, car payments can be much higher than the budget can bear.
Don't let manufacturer incentives lure you into a trap that leaves you cash-strapped. Call us at 812.424.2621, option 3 to help you sort out your options and figure out the best financing for your car - and your cash flow.
