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Anyone seen any 0% financing offered on used vehicles? #5433888 05/20/20 06:38 AM
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grampi Offline OP
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I have noticed lots of different financing options offered during this economic shut down, but as far as I know, they're only for new vehicles. Has anyone seen 0% financing offered on used vehicles? If not, what's the lowest interest rates you've seen?

Re: Anyone seen any 0% financing offered on used vehicles? [Re: grampi] #5433901 05/20/20 06:53 AM
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mrsilv04 Offline
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It'd be tough to find 0% on used, as the 0% rate on new is subsidized by the new car manufacturer. Banks and Credit Unions aren't big on lending money for free.

The credit union that I belong to is at 2.9% on 2014 and newer.


2004 Silverado - on its 3rd Jasper engine in less than one year.
Re: Anyone seen any 0% financing offered on used vehicles? [Re: grampi] #5433903 05/20/20 06:57 AM
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AZjeff Offline
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0% is usually from the manufacturer. No reason for them to do that on a used car, nothing in it for them.



14 RAV4 2.5 5W-20 PP
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The most important thing to do in your life is to not interfere with someone else's life. - Frank Zappa

Re: Anyone seen any 0% financing offered on used vehicles? [Re: grampi] #5433918 05/20/20 07:18 AM
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madRiver Offline
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It may be possible eventually to find 0% on certified manufacturer used vehicles.

0% for elongated terms is nothing more then a rebate or hidden money to consumer that is available to dealer to sell a car. People get all excited like they are beating the system however the 0% costs a few thousand to car maker and is a feel good for consumer to sell a car especially elongated terms. The money typically is available mostly to cash buyers as discount on car transaction price. Car dealers try to keep it but decent buyers can get it. Car buying is emotional and financial. And 0% financing taps buyers emotions even people who are financially savvy generally otherwise.

Re: Anyone seen any 0% financing offered on used vehicles? [Re: AZjeff] #5433919 05/20/20 07:21 AM
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supton Online Content
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Originally Posted by AZjeff
0% is usually from the manufacturer. No reason for them to do that on a used car, nothing in it for them.

Makes me wonder, why not?

I mean, they could lease a model for 1-3 years, then turn it around as a CPO. By acting as the bank for both transactions, they can use whatever APR they want--they can just charge more upfront for a lower APR. Just like they do for 0% on new car sales. Makes the OEM into more of a financial institution than a car maker, but hey, follow the money.

I've always wondered about free service, if they could get good service records for the first 30-50-100k then they could turn the vehicle around on the used lot with "all" service records. Just keep the customer coming back for free doughnuts (while enticing them on a regular basis to upgrade).


2011 Toyota Camry, base, 2.5L/6MT, 205k, hers
2010 Toyota Tundra DC, 4.6L/6AT, 159k, ours
1999 Toyota Camry LE, 2.2L/4AT, 225k, his
Re: Anyone seen any 0% financing offered on used vehicles? [Re: supton] #5433943 05/20/20 08:03 AM
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Originally Posted by supton
Originally Posted by AZjeff
0% is usually from the manufacturer. No reason for them to do that on a used car, nothing in it for them.

Makes me wonder, why not?

I mean, they could lease a model for 1-3 years, then turn it around as a CPO. By acting as the bank for both transactions, they can use whatever APR they want--they can just charge more upfront for a lower APR. Just like they do for 0% on new car sales. Makes the OEM into more of a financial institution than a car maker, but hey, follow the money.

I've always wondered about free service, if they could get good service records for the first 30-50-100k then they could turn the vehicle around on the used lot with "all" service records. Just keep the customer coming back for free doughnuts (while enticing them on a regular basis to upgrade).

I suppose as a counterpart to my thinking, most OEM's are basically in the biz of selling cars. New cars. If selling used cars could get models off the production line faster, with higher profit margins, then selling used cars is something to be figured out. But if it doesn't help with selling new cars, then it's not useful. Wild guess here, OEM's aren't that dumb, if offering 0% on CPO (or on lesser) could make them money they would have by now.


2011 Toyota Camry, base, 2.5L/6MT, 205k, hers
2010 Toyota Tundra DC, 4.6L/6AT, 159k, ours
1999 Toyota Camry LE, 2.2L/4AT, 225k, his
Re: Anyone seen any 0% financing offered on used vehicles? [Re: grampi] #5433944 05/20/20 08:04 AM
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Char Baby Offline
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Right!
Used vehicle interest rates are (typically) higher than new vehicle interest rates across the board. However, this is not to say that it couldn't happen. I mean, you/I may find a dealer that is willing to sell a preowned vehicle with 0% financing although probably with a limited timeframe(I'm just creating a scenario here) such as 12-24 months...just a thought! smile


Retired 6 yrs now & lovin' it
-----------------------------------

'80 Firebird FORMULA V8/4bbl-purchased "NEW"
'15 Nissan Altima 2.5 SV
'15 Honda Civic 1.8 LX
Re: Anyone seen any 0% financing offered on used vehicles? [Re: supton] #5433946 05/20/20 08:09 AM
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Quattro Pete Offline
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Originally Posted by supton
OEM's aren't that dumb, if offering 0% on CPO (or on lesser) could make them money they would have by now.


Yup. Car manufacturers don't make money from used car sales. Dealers do.


2002 530i   2015 Q5 3.0T   2018 Charger SRT
Re: Anyone seen any 0% financing offered on used vehicles? [Re: grampi] #5433972 05/20/20 08:56 AM
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MNgopher Offline
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One of my credit unions is at 2.49% (36 months, 2016 or newer). The other is at 2.99% (36 months, 2014 or newer).

Re: Anyone seen any 0% financing offered on used vehicles? [Re: Char Baby] #5433979 05/20/20 09:04 AM
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Originally Posted by Char Baby
Right!
Used vehicle interest rates are (typically) higher than new vehicle interest rates across the board. However, this is not to say that it couldn't happen. I mean, you/I may find a dealer that is willing to sell a preowned vehicle with 0% financing although probably with a limited timeframe(I'm just creating a scenario here) such as 12-24 months...just a thought! smile


I used to work for a big big banks sub-prime auto loan division. You would be amazed at how high interest rates for people with poor credit!

Re: Anyone seen any 0% financing offered on used vehicles? [Re: grampi] #5433996 05/20/20 09:38 AM
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They could easily offer 0% financing on used vehicles. The dealer simply pays the interest up-front (either directly or through the manufacturer's CPO fee) and charges more for the vehicle by including it in the purchase price. By paying the interest up-front they get a big discount on the interest amount. Financing institutions are in business to make money, even the manufacturer's financing arms, they are not charitable organizations. Make no mistake, one way or another, YOU pay the finance interest, new or used.

Last edited by wag123; 05/20/20 09:49 AM.
Re: Anyone seen any 0% financing offered on used vehicles? [Re: grampi] #5434072 05/20/20 11:32 AM
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joekingcorvette Offline
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Even on a new car they just roll the savings into the initial cost of the vehicle. They have different prices for new vehicles such as the one for 0% interest is higher priced than the vehicle you pay cash for. They have their hidden fees we all know it.


2005 Chevrolet Corvette
2014 Ford F-150 4x4 supercrew
2014 Jeep Grand Cherokee Limited (wifes)
2012 Honda Civic 4 door (my daily driver)
2007 Lund Tyee Grand Sport Mercury 115HP 9.8HP
Re: Anyone seen any 0% financing offered on used vehicles? [Re: supton] #5434094 05/20/20 12:02 PM
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mrsilv04 Offline
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Originally Posted by supton
Makes me wonder, why not?

I mean, they could lease a model for 1-3 years, then turn it around as a CPO. By acting as the bank for both transactions, they can use whatever APR they want--they can just charge more upfront for a lower APR. Just like they do for 0% on new car sales. Makes the OEM into more of a financial institution than a car maker, but hey, follow the money.


I guess a manufacturer *could* do something like that on a CPO unit. We'll use the CPO that I just bought two weeks ago as an example. 2017 GMC Sierra SLE 4x4, it was leased under an "ultra low mileage lease" from new, of course finananced though GMAC. Leasee turned it back in after 2 1/2 years and 15,900 miles, and GMAC sent it directly to the GM dealer auction. GM dealer buys it, it easily passes its CPO inspection, and they sell it to me. This truck looks and drives the same as new, even still has 9/32" of tread on the original tires.

I could see GMAC offering a special "CPO vehicle" financing rate on a truck like this, since the first owner had leased it through GMAC, and it was being re-sold as CPO through a GM dealer. However, I wouldn't see them (GMAC/GM/whoever) wanting to go past another 36 months on an arrangement like this. At that point, my truck is now pushing 6 years old, and the risk is going way up, as the drivetrain warranty is expiring or has already expired. New leased vehicles are covered by a bumper to bumper. Now, you're going into territory where the manufacturer is financing a vehicle that isn't covered by a B2B warranty. Another catch.

And for some, 36 months of financing just won't be long enough, when 60 and 72 months are so common now.

However for me, GMAC would have to offer me a rate of .9% (or less) to get my attention. It would have to be something that would soundly beat my local credit union's 2.9% rate.


2004 Silverado - on its 3rd Jasper engine in less than one year.
Re: Anyone seen any 0% financing offered on used vehicles? [Re: grampi] #5434104 05/20/20 12:13 PM
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dareo Offline
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One of my local credit unions actually increased car rates from 2.49 to 3.24. Citing higher demand. A big toyota dealer nearby has an empty lot now. They are running out of new cars. It seems the good deals in interest rate and discounts are gone, and or worse than a few months ago. If you want a bargain on a car you gotta go to Hertz for a rental liquidation.


2018 Regal TourX, 2016 GMC 1500 SLT 6.2, 2007 GMC Savana 6.6 Duramax
Re: Anyone seen any 0% financing offered on used vehicles? [Re: grampi] #5434123 05/20/20 12:35 PM
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It's easy to pay 0% financing on a used car. Just make one payment.

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