As titled.
mathematically: iff your (risk-adjusted) expected return on the loan is less than the interest rate
No - it’s a bad idea. They depreciate - instead place the money in interest bearing investments and use those to pay off the car. I did so recently for a new car and will have paid for the vehicle mostly by earned interest leaving my principal in tact
What interest bearing investment did you use ?
Thank you for this.
If it’s a used car, maybe.....
Just pay it off in 36 months.
Yes, if it won't put a dent in your savings. That way you avoid interest
This, you can buy a new car, but obviously it's better to pay as little interest as possible. However, if you can make investments that provide more income than the cost of the loan, then don't use it all.
Rates on car loans are the best there is. Leverage them.
It’s a good idea to not buy a brand new car buy one a year or two old and avoid the instant depreciation when you drive a new car off the lot. Get a low interest deal if you can (we wait for the 0% deals) and invest the cash.
How can you get 0% interest?
depends. Look at the opportunity cost, invested into something else that returns higher than the interest rate of the loan.
Yes. Gives you more negotiating leverage than if you are using their credit.
That’s no longer true. They actually want you to use their financing.
Depends on what the terms are. If it's interest free for some time period (or anything lower than their cost of capital), it is costing them money, and they are better off if you pay in cash.
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