60/84 car financing

[wmd]

Has anyone ever heard of 60/84 car financing? I was introduced to the
concept this weekend as an alternative to leasing, and I find it intriguing.

The price of the car is financed at the applicable interest rate over 84
months, and that is the monthly amount you pay. The buyer owns the car;
annual kilometers are not an issue.

At the 60 month mark (not 84) there are several options that the buyer
*must* pick from:

1) Pay the remaining loan outright - similar to the buyout option on a
lease. They call this a "balloon payment".

2) Sell the car in the marketplace, and use the cash to pay out the
remaining amount. Note that the buyer may do this at ANY TIME - there is
no penalty, since it is financed and not leased.

3) Trade the car for new. Any amount the dealer offers for the car will
be credited against the amount owning; if the dealer offers the same as
the outstanding (however unlikely), it equals zero: you relinquish the
car, but have nothing more to pay.

4) Re-finance the amount owning for the last 24 months, but at a new
(and potentially higher) interest rate.

In our case, the car we're looking at has a 0% interest rate, so we are
very tempted by this offer. It allows us to own the car and not worry
about kilometers, but the payments are similar to a lease. We also have
the option of over-paying during the initial 60 months, to reduce the
balloon payment at the end. At 0%, it is all going towards the principal.

Any comments or experiences with this type of car financing?

wmd

[PBMJ]

Post by wmd
Has anyone ever heard of 60/84 car financing? I was introduced to the
concept this weekend as an alternative to leasing, and I find it intriguing.
The price of the car is financed at the applicable interest rate over 84
months, and that is the monthly amount you pay. The buyer owns the car;
annual kilometers are not an issue.
At the 60 month mark (not 84) there are several options that the buyer
1) Pay the remaining loan outright - similar to the buyout option on a
lease. They call this a "balloon payment".
2) Sell the car in the marketplace, and use the cash to pay out the
remaining amount. Note that the buyer may do this at ANY TIME - there is
no penalty, since it is financed and not leased.
3) Trade the car for new. Any amount the dealer offers for the car will be
credited against the amount owning; if the dealer offers the same as the
outstanding (however unlikely), it equals zero: you relinquish the car,
but have nothing more to pay.
4) Re-finance the amount owning for the last 24 months, but at a new (and
potentially higher) interest rate.
In our case, the car we're looking at has a 0% interest rate, so we are
very tempted by this offer. It allows us to own the car and not worry
about kilometers, but the payments are similar to a lease. We also have
the option of over-paying during the initial 60 months, to reduce the
balloon payment at the end. At 0%, it is all going towards the principal.
Any comments or experiences with this type of car financing?
wmd

Many companies offer 0% lease as well. The major difference being that you
are not financing the tax. Kms is not aworry either because you know what
the buyout is before you sign up. If you go over on kms, you simply buy the
car at end of lease. Then if you like, you trade it in.

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[Margie]

Post by PBMJ

Post by wmd
Has anyone ever heard of 60/84 car financing? I was introduced to the
concept this weekend as an alternative to leasing, and I find it intriguing.
The price of the car is financed at the applicable interest rate over 84
months, and that is the monthly amount you pay. The buyer owns the car;
annual kilometers are not an issue.
At the 60 month mark (not 84) there are several options that the buyer
1) Pay the remaining loan outright - similar to the buyout option on a
lease. They call this a "balloon payment".
2) Sell the car in the marketplace, and use the cash to pay out the
remaining amount. Note that the buyer may do this at ANY TIME - there is
no penalty, since it is financed and not leased.
3) Trade the car for new. Any amount the dealer offers for the car will
be credited against the amount owning; if the dealer offers the same as
the outstanding (however unlikely), it equals zero: you relinquish the
car, but have nothing more to pay.
4) Re-finance the amount owning for the last 24 months, but at a new (and
potentially higher) interest rate.
In our case, the car we're looking at has a 0% interest rate, so we are
very tempted by this offer. It allows us to own the car and not worry
about kilometers, but the payments are similar to a lease. We also have
the option of over-paying during the initial 60 months, to reduce the
balloon payment at the end. At 0%, it is all going towards the principal.
Any comments or experiences with this type of car financing?
wmd

Many companies offer 0% lease as well. The major difference being that
you are not financing the tax. Kms is not aworry either because you know
what the buyout is before you sign up. If you go over on kms, you simply
buy the car at end of lease. Then if you like, you trade it in.

Was there a mention of a 60/96? That's there too. We were introduced to it
a couple of weeks ago. . . . we went with leasing though.