Zero Percent for 84 Months Hits Midwest Chrysler Dealers

We reported recently on the growing trend of the seven-year car loan, but as we head into the holiday car-shopping season some dealers in the country’s heartland are adding a twist to the lengthy term.

Related: Seven-Year Car Loans More Popular, but Beware

Chrysler dealers in certain Midwest states including Illinois, Missouri and Wisconsin are offering 84 month financing deals with zero percent interest through Chrysler Capital the company confirmed with Cars.com. The deal is also only good on three models at this time — the 2015 Chrysler 200 (excluding LX trims), 2015 Chrysler Town & Country and 2015 Dodge Grand Caravans — and runs through Dec. 1.

No good deal is without the fine print, however, and when it comes to financing offers it all hinges on the shopper’s credit score. To secure loans like this, your credit score generally has to be top tier, think 720 and higher. One estimate suggests only 15 percent of car shoppers generally qualify for zero percent offers, and the requirements may be even more stringent for this particular offer.

Some Chicago dealers are offering zero percent for 84 months on other models like the 2015 Jeep Cherokee, but those deals aren’t being offered through Chrysler Capital.

So why make a big splash with this deal (at least that’s what we consider commercials during football games in Chicago)?

It’s a great hook to get shoppers into the dealership just like any other flashy claim on cash back or other incentives.

But if you qualify and are in the market for one of these cars — or any car with a zero percent deal for that matter — there is nothing wrong in a financial sense for choosing it.

“The few Americans with the sort of sterling credit to even qualify for an 84-month car loan at zero percent clearly have their financial ducks in order, which means they may actually benefit from something like this by leveraging the time value of money,” said Cars.com Consumer Affairs Editor Kelsey Mays, who points to investing the savings to generate interest.

“Those who don’t qualify should beware, however, because an 84-month loan at a higher interest rate saddles you with a lot of long-term debt,” he added.

Let’s say you’re buying a 2015 Chrysler 200 for $25,000 with 20 percent down and sales tax of 7.25 percent at zero percent for 84 months. Your monthly payment will be $259.67. At 1.9 percent that would be $277.52 over the same term, and at 3.9 percent it would be $297.14.

But if you did zero percent for a more traditional 60-month term, you’d be looking at a payment of $363.54, which takes more than $100 out of your hands that you could be putting elsewhere.

Shoppers can use Cars.com’s payment calculator to do their own research before they buy right here. And as always, we recommend shoppers be prepared before heading to the dealer.

Cars.com photo by Evan Sears