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0% Car Financing - The illusion of a Great Deal - Rebate vs. 0% Financing

Zero percent car financing for automobiles has been around for years and works as a successful marketing campaign for Canadian car dealers. It's so successful that other industries have copied it such as the furniture and credit card industries. Research shows that only a third of buyers who apply for 0% car financing actually qualify and only 10% of those close according to the National Automobile Dealers Association. In other words, an applicant must have a perfect credit rating to qualify. Many of those who qualify for zero percent financing overpay for their vehicles because they don't try to negotiate the price. They mistakenly assume that they have already gotten the best deal available. Is 0% car financing the best auto loan rate? The 0% offer is usually accompanied by the “or Cash Rebates of  $5,000” clause. That $5,000 cash you lose by opting for the manufacturers 0% financing is the actual cost of borrowing. This often works out to car loan rates that are much higher than traditional car loan rates. Here is an example:

It is easy to see which is the best auto loan rate. Now let’s look at the same vehicle but pre owned with only 10 000 km on it. Remember you are only qualified for new cars when it comes to 0% car financing.

It's clear and obvious that the better deal is taking the 6.95% rate rather than the 0% car financing. Do your research before buying into these so called special deals.

Apply online and get pre-approved for your New Car Loan today! We'll show you the best bank rates vs. the 0% on the same vehicle. Before you make any decisions, get educated by a company that cares.