18 months no interest financing for new HVAC system?

[pigpen]

We're looking into getting a new HVAC system to replace our old one. A company we got a bid from today offers (through a third party) what the salesperson described as 18 months same-as-cash/no interest financing, which to my current understanding means that we would pay for the unit over the next 18 months with no additional charge, UNLESS we don't pay it all off in 18 months, at which point they would charge us an insane interest rate.

I don't have any written terms in front of me (I would get them, of course, before agreeing to it), but assuming that my understanding of the way it works is correct, this would seem to be a good thing to do, right? Rather than taking $10k-ish out of a savings account paying 4.5% and giving it to them now, I'd be paying them $500/month for the next 18 months and continuing to earn interest on the balance in the meantime.

Am I missing something? Does this kind of plan usually have some kind of up-front fee or early pay-off fee that the salesperson neglected to mention?

[Cranky]

Did you ask what the price was if you paid cash?

I just this morning ordered a new a/c unit, and there was a 6% cash discount. They kinda build the interest into the price, IME.

[pigpen]

Good question. I'll ask.

[Sibley]

I replaced my HVAC last year and got the same deal. For me, it's a Wells Fargo credit card that has special terms. There was no difference between cash upfront and the financing, but it is good to confirm. Note that I would have had to pull money from more than my designated savings account to cover the full balance and I was not a fan of that, so I was perfectly content with the outcome.

I did decide to make a large payment upfront (it would have significantly complicated my monthly budgeting all to avoid pulling the money out of savings upfront but that's why the money was in savings), but since it wouldn't impact the total amount paid I opted to make the payment to the credit card vs. trying to coordinate the split. Simpler for the company.

The minimum payment at least so far has been sufficient to pay it off in the 18 months, so that's what I'm doing. I do not plan to pay it off early.

[Catbert]

I would also plan to pay off in 17 months vs 18 bc counting is always the hardest part.

[Sibley]

I would also plan to pay off in 17 months vs 18 bc counting is always the hardest part.

I'm an accountant. I have amortization schedules, and I update them monthly. The $0 in the interest column is very satisfying. And yes, there's a note on the last line to make sure I pay it off before the cutoff date.