Is it too much to ask..........

kazd

All I want is a traditional 0% finance deal! I pay a deposit and then the balance is paid over 3 years or so and at the end own the car.

Hubby and I are working at the same place and we have taken his ancient Peugeot (s reg) off the road and it will be scrapped. The family car (2.0l automatic xsara Picasso ) which is now coming up for 7 years old only manages about 29mpg, not worth selling so will keep for longer journeys (collecting from Uni etc or when all 5 of us are in the car).

So we want to buy a new car, just a little one with fab insurance and mpg, we have the funds in place but we offset against our mortgage so we want a traditional 0% deal! I don't want to be renting the car where you are restricted to miles per annum etc and worrying about a stone chip.

So can any of you experts out there point us in the right direction?

Thanks

OddballJamie

0% deals are a con, the interest is loaded onto the cars price, much like how Kays/Littlewoods/Very catalogue operate.

1. Use an online broker to get you the cheapest price.
2. Get a quote from them for standard HP and a quote for a personal loan from somewhere like Sainsburys.
3. Compare this rate to your mortgage rate, if it's higher then use your savings and the pay the equivalent monthly amount of a loan back in to your savings.

This way you are effectively borrowing from yourself.

flashg67

A quick google shows that many manufacturers are offering 0% across various models?

I agree with the above though - better to negotiate a good price on the car first - sometimes places like Motorpoint etc have better deals, even if they charge interest on their finance. (They do a straight HP deal - only using them as an example because my last car came from them).
The best deal is the one that costs the least over the term of the deal IMHO?

kazd

I used drive the deal when I bought my Picasso and I still got a true 0% finance deal. The fact is even if you offer cash they don't change the price because that would suggest that as you say despite offering 0% there actually is interest added in up front and that would be illegal.

Most loans are offering around the 6/7% mark!

Ultrasonic

As far as I can see quickly, if you pay the optional final payment these are all effectively 'traditional' 0% finance deals on an Aygo (with the option of not choosing to buy the car outright at the end if you want):

http://www.toyota.co.uk/cgi-bin/toyota/bv/generic_editorial.jsp?navRoot=toyota_1024_root&fullwidth=true&noLeftMenu=true&forceText=%3Cnone%3E&edname=CC2-AYGO-offersandfinance&id=CC2-AYGO-offersandfinance&zone=Zone+NG+AYGO&sr=Mall

As others have said, this may not be based around the best price available though.

Ultrasonic

kazd wrote: »

The fact is even if you offer cash they don't change the price because that would suggest that as you say despite offering 0% there actually is interest added in up front and that would be illegal.

So long as the contract has a purchase price from which payments are calculated to amount to 0% interest over the term I don't see how there would be anything the least bit illegal? Whether this purchase price is different between different deals would seem an entirely different matter. This is actually a situation where it would make sense for a dealer to accept a lower purchase price for a cash payment, since although the deal is 0% to the customer, somebody, somewhere is funding the loan.

motorguy

kazd wrote: »

All I want is a traditional 0% finance deal! I pay a deposit and then the balance is paid over 3 years or so and at the end own the car.

Hubby and I are working at the same place and we have taken his ancient Peugeot (s reg) off the road and it will be scrapped. The family car (2.0l automatic xsara Picasso ) which is now coming up for 7 years old only manages about 29mpg, not worth selling so will keep for longer journeys (collecting from Uni etc or when all 5 of us are in the car).

So we want to buy a new car, just a little one with fab insurance and mpg, we have the funds in place but we offset against our mortgage so we want a traditional 0% deal! I don't want to be renting the car where you are restricted to miles per annum etc and worrying about a stone chip.

So can any of you experts out there point us in the right direction?

Thanks

With respect to your title "is it too much to ask?" - its not a 'right' to get interest free credit over 3 years and car manufacturers are obviously going to structure the deals that best suit what they want to achieve - usually to get you back into their showroom in another 3 years or so to buy another car.

There is little money for a dealer these days in selling new cars so structuring a deal to simply sell a car on interest free credit for three years will hold little appeal for them.

Having said that, Vauxhall are doing interest free credit for up to five years and from £0 deposit so you might want to look at what they're offering.

As others have said though indirectly you're paying the interest anyway as these deals are usually in lieu of the discount you'd otherwise receive.

Ultrasonic

Somebody had better also point out that if you're really looking to save money you should look at buying a used car not a new one. Depreciation on a new car dwarfs the likely cost of repairs on a car that is a few years older. Obviously buy a new car if you'd like a new car, but from a purely financial point of view it's not the best option.

kazd

Ultrasonic wrote: »

Somebody had better also point out that if you're really looking to save money you should look at buying a used car not a new one. Depreciation on a new car dwarfs the likely cost of repairs on a car that is a few years older. Obviously buy a new car if you'd like a new car, but from a purely financial point of view it's not the best option.

We did say we wouldn't ever buy a new car again but I suppose it comes to paying a lump sum out of savings and seeing your balance drop considerably or paying a smaller a smaller amount (deposit) and paying the monthly payment out of your salary.

DUTR

Ultrasonic wrote: »

Somebody had better also point out that if you're really looking to save money you should look at buying a used car not a new one. Depreciation on a new car dwarfs the likely cost of repairs on a car that is a few years older. Obviously buy a new car if you'd like a new car, but from a purely financial point of view it's not the best option.

Disagree, it depends how long you intend to keep the car, I don't know of anyone who buys a brand new car, gets it home and then puts it up for sale.

kazd

Ultrasonic wrote: »

So long as the contract has a purchase price from which payments are calculated to amount to 0% interest over the term I don't see how there would be anything the least bit illegal? Whether this purchase price is different between different deals would seem an entirely different matter. This is actually a situation where it would make sense for a dealer to accept a lower purchase price for a cash payment, since although the deal is 0% to the customer, somebody, somewhere is funding the loan.

A few years back when 0% finance was all the rage we enquirered about buying several items from the likes of comet (an accountant friend of ours had negotiated discount for cash on several items). I am not sure when he bought whether 0% was on the table but it was when be asked and we were told that a cash discount wasn't an option because that would suggest that interest was already built into the item price and that would be misleading the consumer and illegal. We were looking at buying three high value items.