0% Car Finance: Understanding the Fine Print, Real Rates to Expect
0% car finance is a deal that often seems too good to be true. While it is the best car financing in terms of the interest percentage on the surface of the agreement, you should be careful of such promises when buying a car. There may be other fine print details to read and learn about which may end up costing you more money than anticipated.
The Fine Print
0% car finance agreements will usually introduce a 0% interest loan clause at the beginning of the agreement. However, after a certain period of time in which you don't owe interest, the stipulations of the agreement may bump the interest level up. When this does happen, the interest rates are typically quite high, and may even reach as high as about 25%. For this reason, it's a good idea to read the car finance agreement's fine print very carefully before you agree to the loan stipulations.
Penalties and Other Considerations
0% interest rate loans often have other ways that you may be required to pay more money as well. For instance, it's a good idea to watch out for severe penalties for refinancing or changing the loan terms if you have a loan of this type. That can be a major financial burden to you at a time when you're trying to refinance the loan.
For more information about 0% car finance loans and other loan terms, consult with a finance specialist or another professional with additional questions.