A down payment is a strong thing to have when shopping for a vehicle. For someone with bad credit, it can have a major influence on the deal and the rate offered to them. The question is for many, however, how much they should prepare to put down when shopping for a vehicle.
Edmunds states that the conventional wisdom for down payments puts the amount at 20 percent. The problem is that in their evaluation of car payments made in 2013, the average amount was only 12 percent. Why is the number so much lower than the estimated amount?
One of the issues that a Jack Gillis with Consumer Federation of America is quoted as saying is due to the increase of the cost of a vehicle while the buyer’s income has stayed flat. Another reason is that the minimal down payments required are much lower. This would lead people to be putting lower amounts to the down payment as buyers are attempting to spend as little as possible.
Even with this struggle though, Edmunds recommends that the buyer should concentrate on achieving that 20 percent down. It might be a lot up front, but that can really pay off further down. Think of it as more of playing the long game. A vehicle is a large investment and the sooner you can pay off the vehicle, the better your financial life will be. A larger down payment helps speed that process along.
If you need help with financing, contact us at Bayside Chrysler Jeep Dodge. We’ll work with you to find the right possible loan to suit your situation. We love to say yes, you’re approved! Like us on Facebook and follow us on Twitter to see our monthly news and special offers.
