A car dealership is advertising a new car for $25,000, with zero percent down. The car loan is a 60 month term. To many consumers, this may sound like a good deal but is it? For the sake of  discussion, lets break this down. The monthly loan payment is $416.67 which is approximately $5,000 per year. However, in addition to the loan payments, sales tax must be paid either up front or added to the loan. Another factor to be considered is depreciation of the vehicle. A vehicle typically depreciates about $2000 the first year, bringing the value of the car to $23,000.  With depreciation and the amount and term of the loan payment, a consumer should look at the whole picture before considering these types of car loans.