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0% for 60 months annouced today!.... Posted by Mike Lynch [Email]  (#81) [Profile/Gallery]
(more from Mike Lynch) on Wed, 7 Apr 2004 15:54:04
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All 2004 9-3 and 9-5's except 04 Convertibles. Now Saab has added another level of deal comparing, for example: Which is cheaper?
1. A $30k car/finance balance at 0% x 60
2. Or a $27k car at conventional rates
The answer depends on the conventional finance rate. At 0% $30k is $500 a month for 60 months, at 4.21% a $27k balance is also $500 a month.
The tricky part is for the same payment, it's definitely better to take the incentive and pay a conventional rate. Let's say you win the lotto, or refinance you home after you make only one payment. In example 1 your payoff would be $29,500 after one payment, there is no interest savings on a 0% loan! In example 2 your payoff would be approx $26,598, the first payment would be approx $402 in principle and $98 in interest making you payoff balance the $26,598.
Let's move up to a 9-5 price range $40k
1. 0% at $40k = $666 x 60
2. Conventional rate at $35k x 5.35% = $666 x 60
Greater balance, greater incentive, higher break even point at 5.35%, but again even at the same payment, taking the incentive and paying a conventional rate has a strong short term advantage and no long term disadvantage, the payoff on the conventional loan at the lower balance is always, always lower, after the first payment or the last.
The 0% is great publicity, but Saab has had the goods (incentives) in place all along. At current incentive levels always take the incentive.
If a customer asks me to quote 0% payments on a particular Saab, I can then show them how to have a payment that's less than the 0%! With this kind of incentive and rate ammo it should be easier to sell Saabs.
posted by 63.197.222...
, Wed, 7 Apr 2004 15:54:04 <-- Viewing This Message
, Thu, 8 Apr 2004 16:09:08, Thu, 8 Apr 2004 11:43:52, Thu, 8 Apr 2004 11:24:54, Thu, 8 Apr 2004 15:28:13
, Wed, 7 Apr 2004 19:51:36
, Wed, 7 Apr 2004 16:43:49
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