This is a cut and paste from a post I made in a thread earlier this year. As the year winds down, these questions will be asked more and more, or every time 0% is offered. The numbers here are estimates and are always changing. The zero percent game never changes though. You give up thousands to take "their money" while they are actually taking yours. Weigh the facts and make your own decisions. Just know that when you take zero percent that you actually pay thousands more for the truck.

So, here it is...

Let's say there are a total of $8250 in rebates a available on XL and XLT models. There are some others a available that will get you another $1000, like AQHA and military/first responder.

If I read the small print correctly, $2000 of that is to finance with Ford at market APR rates, not special ones. Another $5750 requires standard market rate financing as well, so now you’re down to $750 off of sticker if you take 0%.

Most any dealer will discount 10% with little or no bargaining, but lets say you negotiate 15%, which is a fair to deal. For the sake of argument let’s say we’re talking about a 4x4 SuperCrew XLT dealer lot special with an MSRP of $50,000.

The guy with fair negotiating skills gets the dealer to knock off $7500 from sticker price (15%). If he takes 0% financing there will be an additional $750 off, total discount $8250. Sales price is now $41,750 without any other fees or sales tax. Lets do a rough guess and say that’s an additional $3250. Now you are at $45,000 to finance.

The same guy decides to skip 0% and take advantage of all the rebates offered. Using the numbers above we will now take an additional $7500 off the negotiated price. But the buyer has to finance at what looks like 7.9%, right now, for let's say 84 months, since most would be shopping payment rather than price. New total price with rebates is $34,250. Let’s reduce the sales tax for the lower price and come to about $2500 in taxes and fees. Total amount to finance is $36,750.

Okay, lets look at those payment numbers.
Zero percent - $535
Full rebates 7.9 % @ 84 mo - $570

Well that’s $35 a month less. 0% for the win, right?
But wait, we’re not done.

Most credit unions are offering 4.9% for the same 84 month term. Go refinance the truck right after you buy it.

Taking the full rebates, the price per month is now $517, Hmmm. Maybe Zero percent isn’t that good of a deal as it seems.

Zero percent - you owe $45000 over 7 years. The payoff is always based off of that. Paying off early, like with a trade in or if you just want to be done with the payment cycle, gives you no advantage.

Full rebates - you owe $36750 the first day of the loan, even if you don’t pay off early, at 4.9% you still will only pay a total of $43600 vs a full $45k for zero percent. Zero still costs $1400 more. But, if you pay the loan off early, say in 3 years, that will save you even more in interest charges.

But wait! If you finance for 66 months down at the credit union, you get 2.9% right now. Let’s look at those numbers.

Full rebates - $608

Well, that’s $73 more a month, how’s that a good deal? It is because the truck will be paid for 1.5 years sooner and the total cost if you don’t pay off early (and this is huge) is $39800. You will be in equity far quicker, which means you wont need GAP coverage after that. If you hate the truck after 2 years, and you drive average miles, you won’t be upside down if you want to trade it.

So, if you’re willing to pay $73 more a month at 2.9% for 5.5 years you will save $5200 vs zero percent at 7 years. Take zero percent for 6 years (72 mo) on $45k and you’re now at $625 mo.

Rebates vary in different parts of the country. Check your local dealer for what’s available in your area.

I hope this helps those who are considering zero percent, or anyone looking at buying now.

 

To me, 0% is worth $2k. $10k without the loan or $8k with the 0% loan. Otherwise, it's credit union for me at 1.99%.

 

If I plug in our total truck cost at 0 down and 0% for 72 months versus the same other than 1.99% for the interest, it's about $3900 in interest saved alone - not to mention that our money stays invested as we slowly pay it back - if I make the same 1.99% on the invested money over that time, I should double the $3900's value in the whole deal. When we bought our truck there was no other offer, as in you can have either xxxx$s cash OR 0% financing - it was only the 0% for those that could qualify. For our situation, it was a no-brainer to take the 0%... And we got our (factory ordered) truck well south of dealer invoice, PLUS thanks to the wonderful folks in this forum, scored an additional $2K off via a Ford PCO...

Scott