# Car finance 0% deals



## Daddy (11 Aug 2014)

Anyone up to speed with the best car finance deals on the market at the moment preferably offering 0% finance.  Thanks.


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## mandelbrot (11 Aug 2014)

There's no such thing as 0% finance...


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## Guns N Roses (11 Aug 2014)

mandelbrot said:


> There's no such thing as 0% finance...



Volkswagen are currently offering 0% APR finance packages on selected models for a limited period.

They also offer finance on other models as low as 3.9% APR.


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## mandelbrot (11 Aug 2014)

Guns N Roses said:


> Volkswagen are currently offering 0% APR finance packages on selected models for a limited period.
> 
> They also offer finance on other models as low as 3.9% APR.



WHOOOOOSSHH! 

That was the meaning of my post going over your head!

It's not actually 0% finance; the interest rate is rolled up into the "price".


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## twofor1 (11 Aug 2014)

A work colleague had cash to buy a new car so thought he would avail of the 0% finance and hold on to his cash.

The list price would apply for the 0% finance offer.

If he paid cash he got a substantial discount off list price, in this instance over €1K.

So in effect the 0% finance would have cost him over €1K.

Depending on your individual circumstances, zero or low finance deals are not necessarily bad, but need to be examined carefully.


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## Guns N Roses (11 Aug 2014)

mandelbrot said:


> the interest rate is rolled up into the "price"



Could you elaborate on this please Mandelbrot?

Do you mean that you pay the "non cash price" as Twofor1 suggested or that the "interest" is hidden in the monthly repayments?


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## peno (11 Aug 2014)

The price of the car will be inflated to include the interest.
Or more appropriately the price is the pure list price.
It you are paying cash you will get a discount off the list price.
Because it is finance no discount will be given and you will pay the full list price. 
Hence you officially pay no interest but you do pay a higher price for the car.

No such thing as a free lunch.


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## Guns N Roses (11 Aug 2014)

I believe the "discount price" for paying cash only applies to a straight deal and not a deal which includes a trade in.

In the majority of cases, most car buyers will be trading in their old model and will not be able to avail of the "discount" anyway.

In these cases, is a 0% finance offer not a good deal considering most banks are only offering 11.5% for car finance?

Just because you don't get the cash price is unfair to say a 0% finance package is not truly 0%.


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## Sunny (11 Aug 2014)

peno said:


> The price of the car will be inflated to include the interest.
> Or more appropriately the price is the pure list price.
> It you are paying cash you will get a discount off the list price.
> Because it is finance no discount will be given and you will pay the full list price.
> ...


 
But that's common whether the finance is at 0% or 8.9%. If you have cash, great but if you need finance, 0% finance deals don't make the cars 'more expensive'. There is no hidden cost as the list price doesn't change depending on what rate of interest you pay.


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## mandelbrot (11 Aug 2014)

Guns N Roses said:


> Could you elaborate on this please Mandelbrot?
> 
> Do you mean that you pay the "non cash price" as Twofor1 suggested or that the "interest" is hidden in the monthly repayments?



As Twofor1 said


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## cremeegg (11 Aug 2014)

I had a good look at this 0% finance concept for buying cars last year. 

It looked too good to be true. Of course the point that with the 0% you cannot get a discount is probably true but that hardly invalidates the concept. After all x thousand paid over 3 or 4 years is probably preferable than x minus 1 paid up front. 

I think the reason the car companies offer 0% finance is to get you to spend more. If you have €10k cash you could buy a second hand car for that amount. If they offer 0% finance you might be tempted to buy a new car for 25k over a number of years. 

In conclusion the 0% deal may be better than say 10% at the bank or CU for a discounted price tag. But the catch is that you are spending much more money than you would if the deal wasn't available


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## twofor1 (12 Aug 2014)

Guns N Roses said:


> In the majority of cases, most car buyers will be trading in their old model and will not be able to avail of the "discount" anyway.
> 
> In these cases, is a 0% finance offer not a good deal considering most banks are only offering 11.5% for car finance?


 
I would bet you would get a far higher trade in value on your existing car if you were not availing of the 0% finance offer.

It might be a good deal, you have to do the sums in your circumstances and decide. Just because it is 0% finance does not guarantee a good deal overall.


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## Leo (12 Aug 2014)

twofor1 said:


> I would bet you would get a far higher trade in value on your existing car if you were not availing of the 0% finance offer.
> 
> It might be a good deal, you have to do the sums in your circumstances and decide. Just because it is 0% finance does not guarantee a good deal overall.



Exactly. You just need to do your research before committing.

If you're trading in, check what a couple of garages will give you for trade in against cars of similar list price. Also, check what the going rate for private sales of your car is. You may be much better off selling your car privately though many people don't want the hassle.

Find out what price dealers will give you on a straight cash deal on the car you're interested in buying. 

Then, armed with this information, you're in a position to decide whether it's a good deal or not. 

Be aware of the T&Cs of 0% deals as well. Most require 50+% of the new car paid up front, some may have balloon payments at the end. As they're generally HP deals, if you miss payments or don't meet all the criteria, you may lose the car or be rolled onto an expensive financing package.


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## Gerry Canning (12 Aug 2014)

Daddy; 

Do the deal on nett price with garage. Do not mention finance. Then ask for their finance plan. You will then get full benefit of any 0% deal.
If it is 0% that includes the documentation fee normally e75 and end fee e75.
Be careful of deals at 0% for say 36 months and you then have to find a lump sum.


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