This is the best buyer’s market ever for a new car buyer. The unexpected drop in sales has made dealers and manufacturers desperate to sell vehicles and willing to offer great deals to do it. But, as AOL Autos points out, these companies have to walk a fine line between offering great deals to draw in buyers and devaluing their products by pricing them too low.
GM is doing this during its bankruptcy by offering a discount on its cars and coupling it with 0% interest on any car loan financed through its finance company. No interest auto loans are nothing new, but until recently, you had to make a choice between cash back incentives and 0% interest rate auto loans. Companies weren’t offering both. Also unavailable before was a long term 0% interest car loan. Now 48 and 60-month auto loans are available with 0% interest rates.
No interest car loans can save a new car buyer thousands over the life of the loan. A buyer with a $30,000 auto loan and a 6% interest rate would pay $4,800 more over 60 months than someone with a 0% interest rate. Because interest compounds, a 0% interest rate would save that buyer 16% of the cost of the car.