The overall car sales have been in a slump and this has forced the carmakers to offer many attractive incentives including 0% interest to boost up their sales. The period for which the 0% APR is given is for a short-term period of 24, 36 or 48 months. The difference between the actual loan and the 0% apr is that we do not need to pay the interest that is associated with the loan. This may seem to be a great deal. Most manufacturers give us the option of 0% APR and also the cash rebate deal.
We have to choose any one of these, which would be the 0% APR, but the other option would cost us less than this one. The monthly rebate would give us a lower monthly payment than the 0% loan. This is given in a short-term basis. The buyer’s interest is aroused by the 0 % APR offer provided. This also serves as a tool to get the people all excited about the car. The practice has been in the industry for some time and has been favored by many buyers before they even understand about the functionality.
The basic criteria to avail the 0% APR loan is that the credit score should be more than 680 and in some case may be above 700. The rates would increase as the credit scores reduce below 680. There is 8% APR for a person with a credit score of 600 and a whooping rate of 20% APR for a person having a credit score of less than 600. The financing can be availed for both the used cars and new cars and for both the purposes namely the commercial and personal purpose.
The better way to go about is the period to which the loan is to be repaid and hence choose what financing to go for. Short-term basis the 0% APR would prove to be useful. Not many automakers are offering the 0% APR deal, and also many models are not having the deal. Such promotions are effected on the cars that are difficult to sell such as the SUVs, the jeeps, and four-wheel drive vehicle. As mentioned, the deal can prove effective for a short term.
Many manufacturers have implemented the scheme and have attracted the buyers. The main outcome to drive the sales during the turmoil has been effective in some extent. The 0% APR when calculated for a long term would not be effective but to go for the monthly rebate would