Buying A new car - maybe

[Flasch186]

So GMC is doing the 0% financing......so Im thinking of trading in the jeep owe 12 grand at 5.5% and getting a Yukon. any thoughts? I spoke to the financing dept. and they said no prepayment penalty and no backloading of the interest, so it looks like a win win....no?

[digamma]

What year is your jeep and what are they giving you as the trade in value for it?

[Flasch186]

2001 80k miles im just hoping for the 12000 in payoff

[Swaggs]

You are probably going to have some negative equity on the jeep...

[Flasch186]

like i said, im hoping for a wash on that.....plus Im thinking perhaps to wait some more and see if there are some better deals run in a month by some of the other vendors. any thoughts?

[Rasmuth]

if you're gonna do 2004's...do it now...great financing and/or rebates...but inventory is rapidly diminishing. 0% financing is just crazy...for 72 months!

[Balldog]

I was actually thinking of doing something similar to get rid of my truck and get something with better gas mileage. Basically I figured my payment (because of losing on my trade-in) would be the same but I would have about $100 less each month in gas.

I would be surprised if you got $12k for your jeep though.

[jonesz]

Just make sure that you are going to want that new car for 72 months. 0$ financing is a great incentive, but if you go to sell the car in 36-48 months, maybe longer, you are probably going to be upside down on it still (i.e. owe more money then it's worth. That's a lot longer than a lot of people want to have their car as they get sick of it quicker (as seems to be the case with your current jeep?)

Another thing to consider is that this incentive is on the 2004 models with a lot of 2005 models already on the lot. As this is the case, the car has been depreciating just by sitting on the lot as it is a year old already.

Just for refernce however, I am not keen on purchasing new cars. They depreciate so fast that first year. I always look to purchase a 2 or so year old car that is dealer certified. That way someone else has already paid a large part of the deprecitation and you still get a warranty under the dealer certification plan. Leasing is another good alternative if you only like to keep a car 3 years are so. There are some good leasing options available currently as well.

A good unbiased overall reference site is www.edmunds.com for car buying..

**edit to add: another thing with the 0% interest is that other incentives (dealer rebates, cash back incentives, etc) usuallly do not apply if you go that route. May want to ask about this if you decide to go with the 0% financing...**

[CraigSca]

FYI: Consumer Reports rates the Yukon off the charts as far as problems are concerned (and I mean this literally - they had to break the chart to show an accurate representation of the problems the truck has). If I were looking for a new car/truck, I'd check Consumer Reports and edmunds.com (as jonesz said earlier) first.

Also - USA Today had an article in this past weekend's edition regarding the hazards of a 6 year car loan (even with 0% financing). Unfortunately, it wasn't my paper so I didn't read the article.

[flere-imsaho]

If I recall correctly, the problem with car loans over 5 years is that you're increasingly upside-down in them (as jonesz has pointed out). My first thought, upon seeing these ads, is that GM is hoping to trap a lot of people into an endless cycle of:

1. Buy car at 0%/7 yr loan
2. 3-4 years later, quite upside-down, but want new car
3. GM "comes to the rescue" and offers new car, long loan, slightly higher interest, and some relief on the upside-down debt
4. Repeat as necessary

As everyone else has said, check out edmunds.com for all of your car buying advice needs.

In related news, Audi is offering 0% loans (shorter terms) on 2001 A6s, which are good cars. You'll get a certified used car with a good warranty, without the initial depreciation hit and with the initial kinks worked out.

[Rasmuth]

you can get $5500 in rebates on the Yukon in lieu of the 0.0%...are you eligible for the GM discount? Bear in mind the 0.0% is only on 2004 models...you still may be much better off using the rebates...

[Fritz]

If I lived in florida I would be driving a surplus DUKW