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Smart’s $99 Loan Deal Has Big Balloon Payment at End

Smart offers 36 low monthly payments–with a whopper ($6,667) due at the end.

By Diana T. Kurylik, Automotive News
Courtesy of

Hoping to benefit from the federal cash-for-guzzlers program, Smart USA has set up a $99 monthly payment for buyers who use their $4,500 rebate. 

But there’s a catch–and a hefty balloon payment disclosed only as a note to an asterisk in Smart’s press information announcing the offer. The Smart financing is for $99 a month for 36 months, with a balloon payment of $6,667 due at the end. 

Dave Schembri, president of Smart USA, says the payments are calculated on a $13,335 ForTwo model with air conditioning and includes shipping. Smart has set aside about 1,500 cars for the program, he says. 

Schembri says the ForTwo will have a 50 percent residual value after 36 months. The ForTwo has a combined fuel economy of 36 mpg. 

The rebate legislation, scheduled to go into effect this summer, requires that the car being scrapped have a combined mpg of 18 or less to get the maximum $4,500 incentive if the vehicle being purchased gets at least 10 mpg more than the old one. 

Schembri defends the balloon payment, saying that kind of financing is part of the offerings by Daimler Financial Services–the captive finance arm of Daimler AG, which makes Smart.

John Paul Strong

John Paul Strong combines his two decades of automotive marketing experience with a team of more than 150 professionals as owner and CEO of Strong Automotive.

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