Financing loan durations

[CinderSchnauzer]

Do not think of debt in terms of dollars and cents.

Think of debt as imprisonment. Your "sentence" is you being forced to work for the length of that sentence. If you finance something for 6 or 7 years, that does not just mean you owe X number of dollars. What it REALLY means is you have now put yourself in a situation where no matter what, you must keep working for 6 or 7 years. You could say you would have to work anyways, which is true for 99% of us. However, if you did not have that obligation of a payment, you would have a lot more freedom to work less, or do things you want to do.

The problem with blanket statements like this is they do not apply to all situations. First I don't "have to work" and could have just paid cash for my latest giant yard toy. Instead, I received a decent discount from list, gave a small down payment and signed for 0%. Price was the same either way. Still have the cash available and won't even miss the monthly payment. Almost as good as getting a free mower.

 

[Gator6x4]

When someone tells me I can buy something at 0% at the same price as cash, I leave. Manufacture's factor in interest and other hidden cost then set a sale price. A purchaser then agrees to pay the manufacture a amount per month arrived at by dividing the total months of an agreed payment period.

 

[Piston]

The first two posts in this thread answered your question wonderfully....and only the first two.



If you would like our opinion on how to mange your finances, just ask (or don't, because you'll get it anyways)

 

[calhoun9001]

When someone tells me I can buy something at 0% at the same price as cash, I leave. Manufacture's factor in interest and other hidden cost then set a sale price. A purchaser then agrees to pay the manufacture a amount per month arrived at by dividing the total months of an agreed payment period.

I always felt that way until this deal on my JD85. Was going to buy with cash until he told me wouldn't make any difference. From what I have seen and heard 18% off list is a good deal even when paying with cash. Would much rather use there money over the next 5 years.