Quick Car Question

[Spooner]

I just found a site offering 0 down, 0 payments, and 0 interest for a full year.

What's the catch? this sounds too good to be true.

oh, in case you wanna check it out Boch Mitsubishi

 

[John]

<< What's the catch? >>



credit

 

[PsychoAndy]

the catch is that the 0% is on whatever term they want.

also with 0% they probably want like a $10,000 down

great. i just turned diamond in YACT

 

[Spooner]

<< also with 0% they probably want like a $10,000 down >>


Dude, I just said it's 0 down, 0 interest, 0 interest for a year.



<< << What's the catch? >>
credit >>


What does that mean?

 

[PsychoAndy]

<<

<< also with 0% they probably want like a $10,000 down >>


Dude, I just said it's 0 down, 0 interest, 0 interest for a year.



<< << What's the catch? >>
credit >>


What does that mean? >>



oh oops. sorry its friday. you have to have excellent credit to qualify cause the bank isnt going to stick their necks out on that kind of cash to people who havent had too much experience with money

EDIT: also the term of the loan and the principal will have a lot to do with the monthy....like if they give you a $20000 car at 0 down 0%....at 36 months, thats over $550 a payment

 

[Sluggo]

Basically what it means is that you own a car that you are majorly upside down in.

Say the car is $25000

Soon as you drive it off the lot its worth $23000

Drive it for a year, its worth $19000

After one year, you begin making payments on a $25000 loan on a car thats worth $19000, and will continue to depreciate at an alarming rate.

 

[goodoptics]

<< Basically what it means is that you own a car that you are majorly upside down in.

Say the car is $25000

Soon as you drive it off the lot its worth $23000

Drive it for a year, its worth $19000

After one year, you begin making payments on a $25000 loan on a car thats worth $19000, and will continue to depreciate at an alarming rate. >>


That basically summed up the downside. I don't think that this promotion is that hot at all. I wouldn't do it personally.

 

[Thegonagle]

It's a Mitsubishi Finance deal, they run it all the time. That means it's going to be available at any Mitsubishi dealer.

You need to have established good credit.

And it's a Mitsubishi, so yes, you will be upside-down for a long time if you take them up on the no payments for a year part of it.

The only good part of the deal is 0% interest for a year, the rest would be foolish to take them up on.

 

[Spooner]

CAn you take the deal, but make payments if you have extra money anyway?

 

[Jzero]

<< The only good part of the deal is 0% interest for a year, the rest would be foolish to take them up on. >>


Exactly. So if you get a $25k car and put down $4k down, now they're financing you $21k.
If you put aside $300 month, you're paying off $3600 interest-free. At the end of the year, if the car is worth $19k (I'm using Sluggo's example if you haven't realized). You only owe $17400 + interest. If you can throw more at it per month, it's even better.

Of course what is the interest AFTER the first year? If it's something outrageously high, you're still upside-down.

Basically, the key is pay down as much of it as you can during that first interest-free year. If you just think of it as getting a car for free for a year, you end up losing out.

 

[PlatinumGold]

The catch is they will charge you like $30 to $80 a month to insure it. then they'll charge you big interest when it does kick in.

 

[Thegonagle]

That's right, Jzero



<< CAn you take the deal, but make payments if you have extra money anyway? >>


And to that, the answer would be yes.

 

[Spooner]

Jzero... that makes sense. I guess I have to look into what the interest after the first year.

I'm assuming they make you finance through them with this deal, right?
After a year, I couldn't just pay them off, then finance through someone else, could I?

 

[Spooner]

nobody knows?

 

[Spooner]

Okay, I found out the possible catch here.

The guy said you either choose to make payments now with a low special interest rate, or you defer EVERYTHING (can't make any payments) until next year when they "match" you with an interest rate based on your credit.

Is this really bad? Still sounds like I could just save up for a year, then make a huge downpayment and get raped on a high interest rate for a little while. What do you think?

 

[Thegonagle]

Hmm, make payments now at 0%, or "get raped" later?

Is it that tough?

 

[Spooner]

Has anyone had experience doing this sort of deal?