What Are the Tricks of Interest-Free Car Loans?

[OMaggie]

Here are the precautions for applying for interest-free car loans: 1. Forced Insurance Purchase: Many seemingly attractive car loan advertisements claim a 30% down payment with the remaining balance to be paid off over several months, promising no interest charges. However, when it comes to picking up the car, the dealer will require the first car insurance to be purchased through them, which may end up costing more than the loan interest. 2. Hidden Handling Fees: In interest-free car loan agreements, there is often a 'handling fee' clause that many people fail to notice in time. By the time they realize it, they are charged an annual handling fee of 4% or even higher, and canceling the agreement at this point is no longer an option. Therefore, it is crucial to thoroughly understand the contract terms before purchasing a car. 3. Interest-Free or Discount, Choose Only One: Some 4S stores offering 'interest-free' loans may stipulate that only one promotional policy can be applied to the same car model. During sales promotions, many models may have discounts ranging from 10,000 to 30,000 yuan. However, after opting for the 'interest-free' option, buyers may receive little to no discount. A detailed calculation may reveal that choosing 'interest-free' actually increases the overall cost of the car. 4. Mandatory High-Priced Car Accessories: While interest-free loans are available, many 4S stores require buyers to agree to purchase car accessories at the original price as part of the contract. A set of car accessories that would normally cost around 5,000 yuan with a discount may cost up to 15,000 yuan at the original price. This could potentially make the deal more expensive than a loan with interest, making it another trick to be wary of.

[VanArianna]

There are indeed many tricks with interest-free car loans, and I've seen many people fall into these traps. The most common one is hidden fees, such as offering interest-free loans but charging high handling fees, which end up being more expensive than regular loans. There's also the issue of bundled sales, forcing you to buy insurance or extended warranties—if you don’t, they won’t offer the interest-free deal, effectively raising the price. Another annoyance is model restrictions, where only base models qualify for interest-free loans, pushing you to spend more on upgrades. Credit checks are strict too; if your credit score is low, you might get rejected or face additional conditions. Additionally, the repayment period is often short, like only 12 months interest-free, after which the interest spikes, pressuring you to repay early. Some dealers even sneak fees into the car price, making it seem cheaper than it is. My advice is to carefully review the contract terms before buying, compare the total costs rather than just focusing on the "interest-free" label, and get a knowledgeable friend to help scrutinize the deal. Visit a few dealerships to gauge the market and don’t rush into signing. Remember, you get what you pay for—offers that seem too good to be true often come with hidden pitfalls. Protect your credit and stay vigilant.