[IMASA]

Can you guys school me on the pros/cons of 0% financing on a car?
I'm looking at a Mazda3 and they're offering 0% from 1 to 6 years.

The advertised cash discount is $1k while the finance discount is $750, so it doesn't seem like there's any major advantage to go in and pay in full, unless they have some massive cash discount that's not advertised.
I have enough in my TFSA to buy the car outright, but I'm earning around a 10% return, so it doesn't make sense to me to pull money out if the rate is 0%.

Is there any reason not to finance at 0% and take the full 6 years? I tend to keep my cars for a long time. I'd imagine I'd keep it for >10 years.

[trollface]

Some ppl don't like seeing monthly payments, either than that. Not really. It's "free" money.

[GabAlmighty]

In your situation I would just take the 0% financing.

Or, since you have cash. Buy a used car (3-5 years old) and save significantly on depreciation. But, you'll be losing out on some of your 10% return that you would get otherwise in your TFSA.

[Dragon-88]

Keep your money in TFSA as that's basically free money. Finance the car at which ever term you're comfortable with. I personally would prefer to pay the vehicle off as soon as possible instead of going to a max term of 6 years but that's just me. I'd take 0% financing any day over spending my TFSA's.

[FerrariEnzo]

when I got my Hyundai back in 2011, it was 0% financing... if you dont mind the long term, its pretty good.. my term was 7 years.. it will be done in June 2018!!!!!

get a car with the most features, after 3-4 years will you wish you want it.. I got the trim just above basic and it was alright.. should have gotta the sunroof and everything..

[320icar]

Just make sure you have it written in that there’s no penalty for paying off in full at any time. So if you got the 6 years but decided after 3 to just pay it, you don’t get dinged

[The Producer]

^^ I've done that twice with mazda - unless something has changed there's no penalty for early payoff. might have been a small doc fee

[tofu1413]

There’s no small doc free for early pay out except on leasing.

0% by all means take it. Use the liquid cash else where and save it for a rainy day.

[IMASA]

So it looks like paying out in cash would give me a $1500 discount.
$1000 rebate and $500 loyalty discount.

Financing would only yield $750 rebate. Still seems better to finance. Other than just having to deal with longer payments, there's no cons with going as the longest term available at 0%?

[tofu1413]

Not at all.


Don’t feel comfortable? Pay it out next year.

[Traum]

In the past, I have seen some bs 0% financing advertisment to state (in small print, no less) that there will still be a 1% admin fee or some utter bullshxt when the 0% financing deal is taken. Read the fine print carefully, and make sure it is really 0% before you commit.

[VR6GTI]

When i bought my wifes car they would not negotiate the price with 0% financing but if we paid in full we would get $4,000 off. So we did that instead.

[Spoon]

Just make sure you have it written in that there’s no penalty for paying off in full at any time. So if you got the 6 years but decided after 3 to just pay it, you don’t get dinged

Why would you want to pay off a 0% loan early? You can literally earn 0.00001% interest and you'll still be better off. :okay:

[meme405]

Why would you want to pay off a 0% loan early? You can literally earn 0.00001% interest and you'll still be better off. :okay:

Say you are trying to get a mortgage or loan, having payments elsewhere looks bad, although it sounds stupid, having a smaller cash contingency and no other monthly payments is preferential to most institutions.

[IMASA]

Alright, at 0% financing for the full 6 years, would you guys even put a down payment? Yes the monthly payments would be higher, but not to a point where it would make a significant impact to me.

[meme405]

Alright, at 0% financing for the full 6 years, would you guys even put a down payment? Yes the monthly payments would be higher, but not to a point where it would make a significant impact to me.

If your reason for doing the 0% and financing is to keep investing the other money then absolutely not, you want to put as much into financing as possible, and delay the payments as late as possible.

[!LittleDragon]

Take the 0%.... I always finance my new cars. Think of it this way... if it's a $30k car and you buy it outright, you'll be out $30k but you gain a car...

If you finance it and you say you're getting a 10% return in your TFSA, you can use the gains to pay for the car. You keep your $30k and you gain a car... the car is damn near free.

That's what I do in theory but in practice, it's not realistic to withdraw from my investment accounts every month for car payments so I leave the money in there and pay for it with work income.

Just make sure you really want the car... I financed a 2011 Sonata Turbo for 84 months at 0%. Made it just past 5 years before I got bored of the car and had enough of FWD. Traded it in for a Genesis 5.0 at 1.9% instead.

[JDMDreams]

The bigger question is please enlighten us how you get 10% consistent return on your Tfsa

[!LittleDragon]

The bigger question is please enlighten us how you get 10% consistent return on your Tfsa

Several dividend funds pay that. PGP, PHK, PFL, PFN, RCS, NCZ, NCV, IEP.

Most of these pay monthly so if you reinvest the returns monthly and compound it, you'll actually end up with more than 10% at the end of the year. Beware, high yield = high risk but over the long term it doesn't really matter. You'll end up with a good average price if you buy regularly. My TFSA is approaching $80k, don't plan to touch it for another 15-20 years.

[meme405]

The bigger question is please enlighten us how you get 10% consistent return on your Tfsa

my TFSA is invested in the stock market, I've had 10+% years, but it's far from consistent.

Trump is really fucking me right now...

[Jmac]

You avoid negative equity by paying in full, but time value of money favours 0% financing IF the difference is properly invested.

[lowside67]

Can you guys school me on the pros/cons of 0% financing on a car?
I'm looking at a Mazda3 and they're offering 0% from 1 to 6 years.

The advertised cash discount is $1k while the finance discount is $750, so it doesn't seem like there's any major advantage to go in and pay in full, unless they have some massive cash discount that's not advertised.
If truly it is only going to cost you $250 to get 0% financing then that is an easy decision. It's not actually 0% of course, but certainly close enough that it's a no brainer.

You could literally buy a 5-year GIC and earn a higher return on that money in your TFSA with a guaranteed outcome, and if you are comfortable in the market, you will do even better (statistically... actual results may vary).

There is no possible scenario where it makes sense to take cash from your TFSA assuming you can afford the monthly payment.

-Mark

[unit]

you earned 10% on the tfsa before, but how do you know it will continue to rise at that rate?

[prudz]

This thread is not giving OP the advice he needs to hear, just the advice he wants to hear. What OP really needs to do is take that $30k and wander over to the Parq Casino, find a baccarat table with panda and start betting heavy on panda. Let all his panda dreams come true! The he will have a free Mazda and his TSFA.

[european]

I want 0% financing on the new Nissan Leaf and 370Z NISMO... but they don't give it to me :okay: :tears:

[Ferra]

Can you guys school me on the pros/cons of 0% financing on a car?
I'm looking at a Mazda3 and they're offering 0% from 1 to 6 years.

The advertised cash discount is $1k while the finance discount is $750, so it doesn't seem like there's any major advantage to go in and pay in full, unless they have some massive cash discount that's not advertised.
I have enough in my TFSA to buy the car outright, but I'm earning around a 10% return, so it doesn't make sense to me to pull money out if the rate is 0%.

Is there any reason not to finance at 0% and take the full 6 years? I tend to keep my cars for a long time. I'd imagine I'd keep it for >10 years.
Mathematically, it is a no brainier you should take the 0% for 6 years.

Psychologically some people don't want to have too much spare money in their bank accounts as they would be tempted to spend it on some useless things.

E.g. why some people prefer to use no reward debit card or cash instead of putting everything on their credit card with 1-2% cash back.
The credit card is definitely better as you get money back and carry no cost assuming you pay it off on time.
Yet for a lot of people, they wound up spending a lot more if they use credit card instead of pay cash upfront.

[kkttsang]

Get 0% finance and talk them down 1000$ Price is still negotiate even when your financing

[J-Chow]

Get 0% finance and talk them down 1000$ Price is still negotiate even when your financing

or talk them down $1000 AND Accessories :fullofwin:

[kkttsang]

or talk them down $1000 AND Accessories :fullofwin:

Ask for the aero kit for free. Looks so good on a white Mazda 3 gt the hatchback version

[meme405]

This thread is not giving OP the advice he needs to hear, just the advice he wants to hear. What OP really needs to do is take that $30k and wander over to the Parq Casino, find a baccarat table with panda and start betting heavy on panda. Let all his panda dreams come true! The he will have a free Mazda and his TSFA.

Fuck that, you gotta go midnight bet at the craps table.

[prudz]

Fuck that, you gotta go midnight bet at the craps table.

Whichever OP chooses to do one thing is certain. The answer is found at Parq casino :troll:

[Gerbs]

At 0% financing you technically get the vehicle for less $$ the longer your term is due to time value of money.

[liukb]

Hello, I currently work sales at a Mazda dealer, I would recommend doing the finance over cash for a Mazda 3 and with $0 down to take advantage of the 0% for up to 72 months. Money you could've put in down payment or cash can be used to invest etc as others mentioned.

The loan is open and can be paid off at any time without penalty, and you can add a lump sum payment onto it at anytime. Let me know if you have any questions

[HonestTea]

This thread is not giving OP the advice he needs to hear, just the advice he wants to hear. What OP really needs to do is take that $30k and wander over to the Parq Casino, find a baccarat table with panda and start betting heavy on panda. Let all his panda dreams come true! The he will have a free Mazda and his TSFA.

Gotta go for the dragon

[prudz]

Gotta go for the dragon


Never! Only ever play player crew and only ever go panda!

[donk.]

go buy a used car with actual money that you have saved.

[snowball]

I also did a 0% over 3 years with $500 down and it was great. You're actually lucky you get 0% at 6 years because the 0% has usually been a reward for people who are able to pay the total faster. It was kind of a PITA to pay 1300 monthly but 650 a month would be bearable.

It makes no sense for people to be afraid of financing at 0%. You end up paying less for your vehicle overall (any savings return over 0% is already a better investment) and it doesn't really affect your prospects of getting a mortgage (especially when you consider you have an extra 40k for a down payment). Honestly, I'm more comfortable with financing at 0% than I am with dropping 40k on one purchase.

[anxiety]

Funnily enough, I'm looking at Mazda 3 hatch (GS models, but GX will also work) with 0% financing as well. Wanted to ask some questions as well haha. Sorry for hijacking your thread, but this might help you too.

1. Are there good discounts to be had on brand new Mazda 3?

2. I was looking at the pre-owned sections, looks like you can save ~$7000-8000 buying a 2014-2016 year model GS hatchback which runs between $16k to 17k, assuming you get brand new one at MSRP price at $24.5k.

http://openroadmazda.ca/used-mazda-cars/35163/2016-Mazda-MAZDA3

Yea you do get quite a bit of saving from the first 2-5 years depreciation, but then I was thinking you have to change tires, brakes on a 50000km car too, if not right away, probably pretty soon after buying. then saving on a lightly used model dips to $5500 to $6500, asumming tires + brakes cost you $1500.

Is my math correct? Is that how much you can save buying a 2-5 years old Mazda 3 with around 50k clicks on it? If you can get a brand new car less than MSRP, then you save even less on depreciation probably more like $4000 to $5000.

I thought that depreciation amount isn't that great given it's a 2 to 5 years old car?

[J____]

This thread is not giving OP the advice he needs to hear, just the advice he wants to hear. What OP really needs to do is take that $30k and wander over to the Parq Casino, find a baccarat table with panda and start betting heavy on panda. Let all his panda dreams come true! The he will have a free Mazda and his TSFA.

wander :)