What does interest-free car purchase mean?
2 Answers
Interest-free car purchase refers to a loan without interest, where only the principal needs to be repaid. Auto loan refers to the loan issued by the lender to the borrower who applies to purchase a car. Auto consumer loan is a new type of loan where banks provide RMB guaranteed loans to car buyers who purchase vehicles from their authorized dealers. Things to note about interest-free car loans: 1. Be sure to apply for an interest-free loan from a formal lending institution to avoid additional fees charged by unregulated institutions; 2. Interest-free usually only means no interest, but handling fees may still apply; 3. Pay attention to whether the interest-free car purchase is for a brand-new car; 4. Carefully review the car purchase costs on the loan contract to confirm if it is truly interest-free.
When I bought a new car last year, I used the interest-free car purchase option. Essentially, it's a 0% interest loan offered by dealerships when selling cars, so buyers don’t have to pay additional borrowing costs. It sounds like a great deal—I took out a 200,000 yuan loan and saved thousands in interest. But don’t celebrate too soon—these promotions usually come with strict conditions: you need a strong credit score to qualify, and I only got approved because my credit was good. Also, some brands might slightly inflate the car price to offset the interest loss or add extra fees, so I carefully compared the total cost to make sure I wasn’t losing out. Additionally, these deals are often part of new car promotions, especially when clearing out inventory, as brands push for higher sales. Overall, it helped me save money, but you have to read the contract terms carefully to avoid pitfalls.
