No Such Thing as a Free Lunch: The Truth Behind 0% Equipment Financing

No Such Thing as a Free Lunch: The Truth Behind 0% Equipment Financing

Let’s say a manufacturer is dangling a shiny “0% financing” carrot in front of you for that brand-new machine. Sounds like a dream, right? No interest, no extra cost, no brainer!

Well… not so fast. Because here’s the deal: there’s no such thing as a free lunch in equipment financing. Someone’s paying for that “free” money—and spoiler alert: it’s probably you.

How You’re Actually Paying for That 0%

The idea of interest-free money might feel like winning the lottery, but the reality is far less glamorous. Here are several common ways that 0% financing is baked into the cost:

1. Markup on Equipment Price

That same skid steer might retail for $52,000 with traditional financing—but suddenly it’s $58,500 when “0%” is in play. Coincidence? Not quite. That “free” interest is hiding in a higher equipment price tag.

2. Manufacturer Buydowns

Here’s the behind-the-scenes math: manufacturers often subsidize 0% programs by offering a rate buydown to the lender. That’s money that could’ve gone toward rebates or discounts, but instead it goes into making the rate look shiny. In reality, you could’ve gotten a better price and chosen your own financing.

3. Hidden Fees

Sometimes it’s not so much 0% as it is “0% plus $695 doc fee, $350 origination, and don’t forget that $1,200 ‘setup’ fee.” These “extras” get conveniently rolled into the purchase price or tacked on at the end of the sale like a surprise party you didn’t want.

4. Less Flexibility

Want to finance for 48 months instead of 36? Too bad. Want to include soft costs or attachments? Sorry, not included. Want to buy out early or refinance? Not on this plan. The fine print on 0% is tighter than a vice.

5. Limited or No Negotiation

Once you accept the 0% financing path, many dealers will simply say, “Take it or leave it.” Try asking for a lower price or extras thrown in, and suddenly you’re told that offer’s only good with full-price financing.

The Case for a Fairly-Priced Used Machine with Honest Financing

Here’s a thought: what if you skipped the song and dance?

• That same piece of equipment, a year or two old, might be 20–30% cheaper.
• Pair it with realistic financing in the mid to high teens—say 14–18%.
• The all-in monthly payment might still be equal or lower than the 0% new machine.
• Plus, you get more flexible terms, fewer restrictions, and no “mystery math.”

And let’s be honest—used machines are like used trucks: a little dust on the fenders, but still ready to haul and dig all day long.

Don’t Let 0% Make You 100% Regretful

At the end of the day, 0% financing might sound like the best deal in the world—but it’s often just marketing in a tuxedo.

You owe it to your bottom line to crunch the real numbers.

Call SLS Financial—We’re the Lunch You Do Want

At SLS Financial, we’ve got no gimmicks, no bait-and-switch, and no “surprise fees.” Just honest equipment financing, smart deal analysis, and help running the numbers your way.

We’ll help you evaluate:

• If that 0% offer actually adds up
• What a used unit might save you
• And whether your cash flow deserves something more flexible

📞 Call us. Message us. Send a carrier pigeon.
Just don’t buy into “free” until you’ve talked to SLS Financial.