How To Get Cars With Zero Percent Financing?

The zero percent car loan is regarded, unequivocally, as one of the best possible deals that can be provided to a borrower. This statement can be regarded as being axiomatic even in case of people who have very good credit records and financial position and are thereby in a position to buy products and services at still heftier interest rates. The interest is a major source of revenue for any bank or non banking financial company that offers loans. For the companies that are into the business of selling cars, this is a major piece of the pie that comes their way when they sell new cars.

Majority of the top automobile manufacturers of the world have created sister concerns that are in the business of providing loans to customers for buying cars. The reasoning behind such a business decision is the realization on their part that most of the car buyers cannot buy vehicles with one single down payment right at the time when the automobile is being sold. The major advantage of a zero percent APR car loan is that it is like being provided with money that has not been earned. It has often been seen that car makers provide rates that are lesser than the traditional lenders like banks or non banking financial companies (NBFCs).

In spite of their lower rates the lending arms of leading car making companies earn more profit than the banks or NBFCs. This is because in their case there is no third party responsible to administer the deal and then handle the consequent payments. This is a major way for them to get more consumers to purchase their products. With a zero percent interest car loan a borrower may actually end up paying an amount that is smaller than the cost price of the car he or she has bought.

0 percent interest car loans can be beneficial for both the borrowers and the lenders

The best aspect of a zero percent car loan is that the borrower can save a significant amount of money that would have been otherwise devoted to paying interest. This money can be utilized for other purposes like spending for the repairs and improvements of the car. This will also allow the consumers to get some much needed return on their money spent on buying the car. It can be said to be a combination of buying a vehicle with both loan and cash.

However, the major disadvantage of a car loan without interest is its period of repayment. On an average, the money is supposed to be returned to the lender in 3 to 4 years. There are some loans that offer a repayment period of 6 years. Thanks to the short repayment period the installments of these loans are fairly high and this means that not many customers are able to afford them. Quite often car makers also offer customers a significant amount of rebate instead of the zero interest loans. For added information on these loans, as well as their relative merits and demerits, please do visit www.carloansbadcredithistory.com.