January 2, 2009

GM Offering 0% Loans Until January 5

Almost immediately after GMAC accepted a $6 billion government bailout on December 30th, GM announced a slew of new incentives including 0% financing on some '08 models. The offer is good until Monday, January 5, 2009. In addition, GM is offering cash rebates ranging from $500 to $4,250 on certain vehicles.

GM will also offer financing to customers who have a minimum credit score of 621. This is a huge reduction from the minimum score of 700 put in place 2 months ago and will make it easier for more customers to get loans. Click Here to get a free credit report and see what your credit score is. Here are the latest incentives being offered through January 5th for qualified buyers:

2008 vehicles:
0% APR for up to 60 months on '08 Chevrolet TrailBlazer; GMC Envoy; and Saab 9-3, 9-5, 9-7X
0.9% APR for up to 60 months on '08 Buick Lucerne
1.9% APR for up to 60 months on '08 GMC Yukon and Yukon XL; Chevrolet Tahoe, Suburban and Avalanche; Cadillac CTS, SRX, Escalade, DTS, STS and XLR
2.9% APR for up to 60 months on '08 Buick Lacrosse; HUMMER H2 and H3
3.9% APR for up to 60 months on '08 Chevrolet Equinox, Colorado Ext and Crew cab and Light Duty Silverado; Pontiac Torrent; GMC Canyon Ext and Crew cab; and Light Duty Sierra
4.9% APR for up to 60 months on '08 Saturn Astra and Sky; Pontiac Solstice; Chevrolet Corvette and Heavy Duty Silverado; and Heavy Duty GMC Sierra

2009 vehicles:
3.9% APR for up to 60 months on '09 Chevrolet Cobalt; Pontiac G5; and Cadillac CTS
4.9% APR for up to 60 months on '09 Pontiac G6; Chevrolet Malibu, Light Duty Silverado and HHR; Saturn Aura; and Light Duty GMC Sierra
5.9% APR for up to 60 months on '09 Chevrolet Avalanche and Heavy Duty Silverado; and Heavy Duty GMC Sierra

Some things to keep in mind: GM will likely continue or expand their incentives after January 5th, especially on the '08 models. For those thinking of buying a SAAB, keep in mind that because 0% financing waives the cash rebate, the financing deal doesn't really help those with good credit.

Car Buyers: Beware of Spot Deliveries

For car buyers with bad credit, sometimes it takes awhile to get approved for a loan. Some dealers, instead of risking losing the sale, will offer to let you drive the car home and wait and hope for the financing to be approved. In about 20-30% of the cases, the financing is not approved and the car buyer is forced to return the car to the dealership and pay any damage or mileage incurred.

This is a terrible situation for the buyer because in many cases, the dealership will have already sold your trade-in. If you still want to keep the new car, you'll have to renegotiate the loan, usually at much higher rates. Spot delivery is actually prohibited by 3 states: Maryland, Michigan, and Wisconsin.

Some dealers are honest and hope you get financing approved, but there are also dealers that know the financing will fall through and still let you take the car home. When they call you later to return the car, they're hoping you'll re-finance at the higher rate. The lesson is, if you're offered spot delivery, just simply refuse it. Sometimes the dealer won't tell you financing has not been approved yet. They will usually place a stamp on the contract saying something like: "SUBJECT TO THIRD PARTY APPROVAL". Make sure you look through your entire contract before signing and taking the car home. Some dealers have been known to put the stamp on the copy of the contract instead of the main contract, so when signing, you're thinking everything is good when in actuality the stamp is on the copy the dealer keeps.

Tell the dealer you'd like to wait and make sure you get approved for financing before signing the deal. You may have to wait about a week, but it's worth the peace of mind.

2009 Sales Expected to Be Horrible

2009 auto sales are expected to be even worse than 2008. Predictions range from 11 million to 12.8 million cars sold in 2009 compared to about 13 million sold in 2008. Most analysts predict the first half of the year will be the worst, with a recovery coming after summer. This means the best buying opportunities may be coming in the next several months. Keep a close eye on incentives and if you've been sitting on the fence, consider buying in the next 3-6 months.

Top 10 Least Expensive Cars

For the 2009 model year, here are the top 10 least expensive cars:

1. Hyundai Accent : $10,665
2. Nissan Versa: $10,685
3. Kia Rio: $12,145
4. Chevrolet Aveo: $12,625
5. Smart ForTwo: $12,635
6. Toyota Yaris: $12,925
7. Suzuki SX4: $13,994
8. Kia Spectra: $14,200
9. Hyundai Elantra: $14,795
10. Pontiac G3: $14,995

Car Buying Report Archives:

  Week of June 18, 2009

  Week of June 11, 2009

  Week of June 4, 2009

  Week of May 28, 2009

  Week of May 21, 2009

  Week of May 14, 2009

  Week of May 6, 2009

  Week of April 30, 2009

  Week of April 23, 2009

  Week of April 16, 2009

Incentives Watch:

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