A call or visit to a dealer should help clarify details about low interest loans. Consider asking these questions:
- Will you be charged a higher price for the car to qualify for the low-rate financing? Would the price be lower if you paid cash, or supplied your own financing from your bank or credit union?
- Does the financing require a larger-than-usual down payment? Perhaps 25 or 30 percent?
- Are there limits on the length of the loan? Are you required to repay the loan in a condensed period of time, say 24 or 36 months?
- Is there a significant balloon payment —possibly several thousand dollars — due at the end of the loan?
- Do you have to buy special or extra merchandise or services such as rustproofing, an extended warranty, or a service contract to qualify for a low-interest loan?
- Is the financing available for a limited time only? Some merchants limit special deals to a few days or require that you take delivery by a certain date.
- Does the low rate apply to all cars in stock or only to certain models?
- Are you required to give the dealer the manufacturer’s rebate to qualify for financing?