50/50 deals, whats your view

Johnny Bitte

Hi all,
Looking at the Opel 50/50 deal and wondering is there anything to wary of. I know you don't own the car til the final payment but would signing up for this deal give the dealer insentive to give you more for your trade in.

The opel one is 50 this year and 50 next year but Kia are also doing it but 50 this year and 50 in 2 years time. So looking at the C'eed

But just wondering are these deals a good thing for getting more for your old car?

-Chris-

There's no such thing as a free lunch.

Anyone have any more specific details about how this works?

Paulw

From looking at the Opel information, it's a case of 50% now, and the final 50% in 2011.

We were very tempted by it when we looked to buy our car, but in the end, since we have the money, we decided to buy clear, and pay all up front.

There is no catch, as long as you do pay off the final 50% on time. If you don't then the interest charges can be high, AFAIK.

Mr Benevolent

The Kia ad says 'Pay 50% up front.. or a trade-in'. At 0% interest and 2 years to save up, it's a fairly good deal. Not to mention the 7 year warranty.

-Chris-

Sorry, just wondering...

It's 0% interest?

Is all pricing based on retail price, or is there discount involved?

Why would there be the impression that better trade-in values against this deal?


Normally, if you get 0% finance, it's at the expense of available discount etc. (the money has to come from somewhere). I'm just trying to see if there's a catch the OP hasn't seen.

Paulw

My understanding - 0% interest for the period. However, if you don't pay the final payment on time, then there is an interest penalty.

So, say your car costs 26k. On buying you pay 13k, and in Jan 2011 you pay the final 13k.

If you're trading in, then the initially you pay 13k - trade in value (eg trade in value of 5k, then you only pay 8k up front). You then pay the final 13k in 2011, at 0% interest.

mickdw

Well Fiat are offering interest rate of -1% on retail price so obviously these deals are being funded by the car buyer not availing of discount that would be there for a traditional purchase. Id say in these economic times, it would be possible to get a pile of extras thrown into the deal too for nothing thereby getting some discount back

tony cochrane

The deals are as straight forward as they seem. There is no catch. All these deals are subsidised by the distributer.
You pay 50%, or more if you want, by way of trade in or deposit of the retail price of the car.
You don't pay anything else for either 12 or 24 months depending on the offer.
You then pay the other 50%. The cost of credit to the purchaser is €0 and the rate is 0%.

The only instance in which interest would have to be paid is, if when the payment is due in the future and you don't have the money to pay it off, you refinance the final payment on a straight forward finance deal.

unkel

mickdw wrote: »

obviously these deals are being funded by the car buyer not availing of discount that would be there for a traditional purchase

+1

If you were going to get 100% finance on the car anyway, you might consider it (do the sums). If you have the cash, a discount will be a better deal.