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Car advertising shows that hot brand new car just begging you to buy it. The ad also says the dealer will give you 0% financing on it. Is that a good deal? Here is what you need to know about 0% financing on your auto loan.

Car dealers are out to make money – like any business. This means that they have to work to constantly get a new turnover of clients all the time. 0% financing is just one of many tools used to get the general attention of the public so that they will come and take a look. And if you are wondering – yes, there is a catch that may make their more regular offers a little more enticing – once you understand the actual offer.

Since everyone likes to think they can get something for nothing – it works to draw people to their car showroom floors. This ends up actually being an either/or situation.

0% financing allows you to make a quick discount on your car financing but only under certain conditions. For instance, in most cases it will require that you pay for the car in three years or less. This causes there to be a pretty hefty monthly payment – even without the interest. In fact, the payment on this kind of auto loan may be still be more than $100 to $150 higher than another loan – even with the interest added!

Other possible subtractions from the new vehicle price most likely will not be allowed. Rebates and other dealer incentives may not be added to the deal on a 0% financing auto loan package. This places you in a position of having to make a choice. You can either get the 0% financing or the package that has the interest plus the possibility of rebates and other offers.

In order to see which deal will work best, you need to do some searching and find auto loan calculators. These will quickly enable you to see the difference between the two loans, enabling you to see which on will best fit your situation.

Some offers require that you also need to put down up to 25%, in order to qualify for the 0% auto loan. This is a pretty steep price – but certainly there are those who can afford it. With this kind of “deal,” however, many people will not even care to qualify.

If you are looking for a low monthly payment, then the choice seems to be rather obvious – 0% financing is probably not for you. For others who can afford it, it can be a great way to have the car paid for in a short time – without interest (or incentives).

Before you do any financing for an auto loan, however, it is always a good idea to shop around. Someone else may have a better deal and you do not want to pay more than is necessary for your new car. Get several quotes, do the calculations, and compare them carefully to find your best deal.

Dealer ads in the newspaper can sometimes be difficult to decipher. There are many phrases, abbreviations, and disclaimers that can make them difficult to understand unless you know what these mean. Here is a list of explanations of common terms you will see in these ads.

1) O.A.C- This stands for “on approved credit”. When a dealer has an ad that offers some type of monthly payment or special interest rate you will see this disclaimer. Auto dealers do not lend money but they do arrange financing through direct lending agreements they have with various banks. When they advertise a special finance rate or monthly payment it will usually be at the cheapest rate they can find. To qualify for these offers you will have to meet certain credit criteria. Not everyone will meet these guidelines so this disclaimer is to let consumers know that if you qualify through their lenders for this offer you can take advantage of it. Otherwise it may be slightly higher.

2) Well Qualified Buyers- Similar to O.A.C this disclaimer means that you have to meet certain credit criteria to qualify for the advertised offer. With this disclaimer though the qualifications are going to be very strict. There may be income requirements as well as credit requirements.

3) Zero Down Plus TT and L- When a dealer advertises a lease or loan payment it may say zero down plus TT and L. This stands for plus taxes, title, and license fees. So in all reality you are putting zero down towards the price of the car itself but you have to pay for your taxes, title work, and license fees upfront to get that advertised payment. If you don’t want to pay those fees upfront then the payment will be higher if they are rolled into the loan.

4) Rebate To Dealer- This disclaimer means that whatever price or payment is being advertised on the vehicle the dealer has already taken whatever rebates are available off of the price to get to the advertised offer.

5)A.P.R- This stands for “annual percentage rate”. Pretty self explanatory but anytime you see an interest rate advertised it will have APR next to it.

6) Security Deposit- When you lease a vehicle the leasing company will require you to pay a refundable security deposit upfront that is due at the lease signing. The amount of the security deposit can vary but it is usually equal to your monthly lease payment rounded up to the nearest $25.00. This deposit will be returned to you at the end of the lease provided the vehicle is returned in good condition and there are no mileage overage charges. In some instances leasing companies will run special offers where they will waive the security deposit.

These ads are not intended to be deceiving but there are so many variables that go into calculating payments and leases and special financing offers that dealers could not possibly put all of this information in the add itself. By adding these disclaimers and abbreviations they can still get their message or offer across. If you have questions you can call the dealer and they will be happy to go through the ad with you to make sure you understand before making a purchase decision.

Given the current economic recession in the entire world, average consumers in America are having financial difficulties. In these difficult times, people are in need of instant debt relief through any source that could help them get back on their feet. If you refinance your auto loan, you not only get the benefit of lower monthly payment, but you can also get rid of other debts like mortgage or credit card debt.

Hence, if you have an auto loan but you are looking to take advantage of a lower interest rate and a new payment plan, then you should perhaps consider applying with a direct lender for refinancing auto loan.

By choosing auto refinancing through a direct lender, you are obviously saving hard earned money because you are not paying any commission. Moreover, direct lenders are the financial institutions that offer lower interest rates so you do not have to worry about paying bigger amounts.

The best thing about direct lenders is that you quickly get approved. Auto loan refinancing with a direct lender can get you approved at the same day which means that you can get a check the very next day after applying. An additional benefit is that usually the reputable and trusted direct lenders have lists of auto dealers where you can shop the car. You can just show up and leave the paper work at the dealership along with your new car which means that you get a good deal and you might be offered some special offer.

Direct auto lenders are certified and registered and you can check them at the Better Business Bureau. This gives you the satisfaction of trusting the lender and you can be sure that you are dealing with a reliable loan provider. You can do a little research of your own and compare the quotes on the internet. This way, you can find the cheapest available interest rate and determine which one is the most suitable for you.