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Ford Focus Purchasing Center (Ask A Ford Salesperson) Discuss about special incentives and ordering information on the Focus & Focus ST.
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Old 04-14-2013, 04:25 PM   #1
ps56k
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0% APR for 60 - creative math

Wife bought a 2013 Ford Focus Hatch SE, auto... end of March... been driving it since then...

I'm not sure I'll get some insight here,
as a quick search on the "90 day loan" topic
is what originally led me to the forum.

Ok - several gotchas on this one... we were going to pay cash.

We were looking at the final bottom line price of $ 20,080..
The dealer/incentive offered $2,000 as a rebate,
and another $500 if we did the Ford Financing.

This is the weird part -
as I couldn't see how the 0% APR would make Ford any money.

Well, the "Ford Financing"
was actually the "standard" inflated APR of 5.99% for 60 months.

The Loan Agreement then showed
$7,500 at 5.99% for 60 months = $145.32/month starting 5/11/13.
This was odd, as my financial calculator was showing $144.96 ??

I'm guessing you can get the 0% APR for 36, 48, or 60,
but then DON'T get the extra $500...

As per the other various threads regarding Ford Financing
and a 90-day waiting period....
we will just pay it off whenever we get the statement.


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Old 04-14-2013, 04:35 PM   #2
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There is some crazy tax thing that ends up saving them money. Taxes are done different than if it wasn't a loan.
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Old 04-15-2013, 12:35 PM   #3
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We ask that you don't pay off on first statement is that rebate gets charged back to us and we lose that amount. In the grand scheme of things if you only finance $10,000 is it really going to kill you to make 3 payments?

To each their own however.
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Old 04-15-2013, 02:32 PM   #4
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Quote:
Originally Posted by imccrea View Post
#1 We ask that you don't pay off on first statement in that rebate gets charged back to us and we lose that amount.
#2 In the grand scheme of things if you only finance $10,000 is it really going to kill you to make 3 payments?
Thought I might see an interesting discussion on the choices involved, guess not...
Asked about a couple of different experiences:
- 0% for 60mos vs "standard Ford financing" vs the rebates involved.

BTW - also asked about financing calc,
since any normal financial calc of $7,500 @ 5.990% for 60mos
yields a monthly of $144.96 vs the Ford loan of $145.32
AND - the interest payment for THREE months/payments is about $110.
I wish that Sales staff would have a basic class in financial math...
--

comment #1 - seemed a reasonable bit of info - not detailed like other discussions in the forum concerning the same topic.

comment #2 - sales ego got in the way - now just lost any credibility.
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Old 04-15-2013, 06:01 PM   #5
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The minor variance in payment is due to the "days till payment" which is factored into their Reynolds and Reynolds or ADP software - whichever the dealership uses. I just plugged in the figures into mine at work, and I come up with 145.27 for the term/rate you specified.

Putting aside the response you got (I won't say I disagree with your sentiment), I guess I'd present it like this - you are paying $110 as you say to pick up an extra $500, right? In my eyes, that's not a bad return on investment from your standpoint. Just another way of looking at things, and maybe one that makes more sense without coming across as a sales person, even though I am.

Hope that helps!
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Old 04-15-2013, 06:33 PM   #6
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If you want to screw the dealer over you bought it from it's your call. As far as losing any credibility.... you can think what you want of me. I'm here to help not have you think I'm a dick out to screw you over.
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Old 04-16-2013, 01:38 AM   #7
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Ira's first commment in your thread here is rather informative. Basically saying you have to wait to get your $500 back. Ya you are going to get charged $110 in interest on your three payments but youre still going to be ahead $390 so stop whining. And lose your attitude, you won't fit in well here.
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Old 04-16-2013, 10:52 AM   #8
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I just see it as this, lets say you own a family owned appliance store and sell a customer a dishwasher for $500. They knowingly write you a bad check, and you're out $500. How would you feel as a business owner knowing your 'customer' is out to screw you out of $500???

Many dealerships are family owned, there are many out there that don't sell more than 30 new cars a month so ya $500 is a big deal to me and to them.
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Old 04-16-2013, 01:38 PM   #9
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I'd just pay it off. Dealer seemed slightly deceptive.
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Old 04-16-2013, 06:16 PM   #10
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If Ford offers you a choice between a $2000 rebate or 0% APR, it's a pretty good assumption that it's the same to them either way. No trickery need be involved.

If you can't make the numbers come out exactly even, it's likely that that's because you're not the accountant for Ford, and haven't factored in all the details about their internal costs of capital, tax strategies, and marketing budget.

Then, too, there are factors like the percentage of people that will intend to pay a loan off after 90 days, but change their mind and just keep making payments. And there will be occasional cases where the $500 up front is worth more than the APR. (For instance, I know of a case where a lease turned out to be a better deal for the buyer than a purchase, despite the higher total cost of financing, because the lack of a down payment meant that the buyer could immediately pay off some very high interest rate credit card debt. The cost of financing the car was a little higher, but the cost of financing their life was lower. Any individual situation involves factors that aren't part of the Ford deal standing alone.)
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