2007-01-21 23:48:47 · 9 answers · asked by rhondahea 1 in Business & Finance ➔ Credit
Incentive -You can normally negotiate a lower price for cashthan credit.
Saving - Interest on loan, plus the above
2007-01-21 23:52:00 · answer #1 · answered by Anonymous · 0⤊ 0⤋
Caution. The first answer is INCORRECT. Dealer's make money on finding financing for you vehicle. They will not give you a better rate if you pay cash.
However, I've listed some pros & cons for paying cash.
Pro: If you pay cash, you own the vehicle outright. You don't have to make payments, you don't have to pay interest. When you want to trade the car in, you don't have to worry about how much you owe on the car.
Cons: If you have very good credit and can get a low enough interest rate, you can SAVE money by financing the car. How? If you can put the money into a Money Market account and earn more interest than you would owe, then you can make payments out of the money market and actually keep the difference in interest. Also, this will help boost your credit - because you are making payments against a debt.
The article below helps with some Financing information, should you decide to do that.
http://development1.blogspot.com/2007/01/financing-car.html
2007-01-22 11:45:18 · answer #2 · answered by trigam41 4 · 0⤊ 0⤋
If you have the cash you probably have great credit. Usually if you're buying a new car there are great deals at the dealership for low interest rates (0% up to 3.9% are the most common) if you qualify for one of these rates TAKE IT! You can make at least 5% off of your cash by putting it in a money market savings account, then you are still making money off of your money instead of putting it all into the purchase at once. If you DO pay cash you aren't required to carry full insurance coverage so your insurance bill could go down if you remove coverage like comprehensive and collision. Although, if you're paying cash for something I would suggest insuring it fully!
2007-01-27 20:26:25 · answer #3 · answered by AriesJWR 4 · 0⤊ 0⤋
When paying cash the dealers WILL NOT give you the best deal !! They want you to finance that vehicle so they can get the interest.
Always ALWAYS m ake your best deal then tell them you have the cash.
If you pay cash you save a load $$$ on not having to pay interest.(as with any loan) Save save save and pay cash for most everything and you financial life will be great.
2007-01-22 10:07:22 · answer #4 · answered by Kitty 6 · 0⤊ 0⤋
no car payment. you get the keep the money you have coming in instead of watching it go out. car also goes down in value quick. so if a 20k car is only worth 9 in five years, you've lost 11k or a little over 2 grand a year. it's better to get a good used vehicle so you don't take that financial hit.
2007-01-29 23:18:05 · answer #5 · answered by Debt Free! 5 · 0⤊ 0⤋
You'll save money, because you won't be paying interest in addition to the sticker price. Keep in mind that automobiles depreciate almost immediately so the more money you don't have to pay, the more you are getting for it.
2007-01-22 07:58:15 · answer #6 · answered by °ĠיִяĿỵ° 4 · 0⤊ 0⤋
wow let me tell you cash talks
you can negitagte a much better deal and price.
no interest! no monthly payment hanging over your head.
Peace when you lay your head down at night knowing you dont have that payment hanging over your head! That does it for me alone!lol
2007-01-26 10:11:31 · answer #7 · answered by tennessee 7 · 0⤊ 0⤋
when you pay cash, you have no debt
when you have debt, you pay interest...and interest is a ruthless robber of your money when you're in debt...the clock ticks on interest and you will always owe more
pay cash!
2007-01-22 07:54:01 · answer #8 · answered by an_articulate_soul 4 · 0⤊ 0⤋
If you pay cash, you won't pay any interest
2007-01-28 23:56:20 · answer #9 · answered by luciousgreeneyedlady 5 · 0⤊ 0⤋