It can cost anywhere between $2,257 and $5,510 to replace a broken-down furnace. Unless you have the cash saved, chances are pretty good you will be taking out a loan to purchase the appliance. If you're not careful, though, you may end up paying a high interest rate on the loan that significantly increases the total cost of the appliance. To help you save money, here are three ways you can get the interest rate you are charged on a personal loan for a replacement furnace as low as possible.
Buy at the Right Season
Shopping at the right time can net you a good deal on financing for a furnace. Companies selling furnaces may be more willing to cut a deal on the interest rate or offer other financing specials during times when business is slow to help move product. For instance, a store may offer customers zero percent financing for the first 12 months of the loan. If you pay the loan off during that time period, then you essentially avoid paying hundreds of dollars of interest.
The best time to buy a furnace is during the slow season, which is typically around spring (February, March, and April). Since the weather is getting warmer around this time, contractors aren't getting too many calls about furnaces. However, summer hasn't hit yet, so they are not getting as many calls about air conditioners either. Fewer calls typically mean a lower cash flow, so HVAC companies are more likely to have great sales on appliances and financing at this time.
Try Manufacturer's Financing
Even though a store may not have any specials going on when you're ready to buy, you may be able to get a deal on financing directly through the manufacturer. Many furnace manufacturing companies have relationships with banks to finance customers looking to buy their products.
In addition to offering rebates and coupons, the manufacturer may also have financing specials such as the aforementioned example of one year of zero percent financing or similar offers. Be aware, though, that you will be limited to purchasing the company's products. Therefore, you will want to settle on the type of furnace you want before using this option or factor the type of financing offered by the manufacturer into your decision.
Go Through a Credit Union
If you're a member of a credit union or are eligible to be one, shopping there for a personal loan to cover the cost of replacing your furnace could save you quite a bit of money on interest rates. Because of the way they are set up, credit unions typically have a lot more flexibility to offer lower rates than regular commercial banks. This can be particularly helpful if you have damaged credit. A credit union may be more willing to offer a lower rate to people with poor credit, whereas a store or manufacturer may charge a higher rate to people with bad credit because of the perceived higher risk.
Lastly, you may be able to get a good rate as a new customer. Sometimes credit unions have programs to attract new account holders that may include offering lower interest rates on personal loans that can be used to buy a new furnace or other things. Use the Internet to research interest rates at the credit unions in your local area.
Financing the cost of replacing a furnace is hardly ever fun, but there are ways you can keep the cost in line. For more information about or assistance with reducing the interest rate on a loan, contact an appliance dealer in your area.www.homesmartcolorado.com