Finance Car - Purchase of contract staff (CFP)
You are usually better get car financing from a financial institution, not the car dealership.
Your monthly car payment should not exceed 20 of your disposable income This amount should cover not only your car payment, but also your insurance and fuel costs.
Long-term car loans cost you dearly in the long term interest of the loan term ideal car is between 3-5 years.
When you walk into a dealership, you will not be there long before a seller asks how you intend to pay for your new car.
When the dealer starts, just explain that you intend to pay in cash saying that you will pay in cash didnt say you open a briefcase with silver bricks inside, it simply means that you are not interested in your dealer or manufacturer financing.
In some cases, if you have a perfect credit, if the car is about to be replaced by a financing sponsored by the newest model dealer could be a good deal, but most of the time, it is not you can usually find better deals on credit unions for car loans and banks.
Tell the dealer that you are not interested in funding removes the opportunity for carpet dealer agreement with dealers superprofits make money on you upcharging, so they have the means to slip various extra fees and charges Giving your financing arrangement financing dealer also allows you to focus on the features and the purchase price of the car you want a much more important task and useful to focus on the monthly payment figure.
After the drop in funding, your next task is negotiating the purchase price of the car a few survival tips.
Resist the temptation to hire Leasing is essentially an extended car rental When you rent a car, you must return it at the end of the lease or purchase from the dealer at a predetermined price usually higher than what you d pay for a car of similar occasion when you take a loan to buy a car, you pay the loan and the car is yours, free and clear only payments you will have to do after that is the gas, repairs and insurance.
Many people rent intelligent and respectable people praise is not a terrible thing to do, but this is not the best way to keep a car, because you are still making payments for a rental car for three years, when the term expires, you need to find a new lease or spend thousands to buy the car you were driving.
Consider certified factory certified used cars is another term for use, but these cars come with additional guarantees on the status of the opportunity Going car can be a very smart move, because most cars lose their value 18 first year a car Approved used is one that has been examined and fixed before it's on the market, and comes with a guarantee of sustained manufacturer, such as new cars do.
Size of your future car loan Once you decide you want a new car, the first thing you need to do is how much you can afford to drive Calculate this amount before going shopping; Do not let a car dealer influence your decision.
Calculate the size of a loan, you should get a good rule Your monthly car payment should not be more than 20 of your disposable income This means that when you have paid all your debts and living expenses, take a fifth of that s left this is your maximum monthly car expenses Ideally, this number should cover not only the payment of your car, but also your insurance and fuel costs.
Decide how long you are going to give you pay off your car loan A monthly payment is, essentially, the amount of your loan, plus interest, divided by the number of months you must repay the loan more months, you must repay the plus the monthly payment will be, but stretching too long car loan or any loan for that matter will ultimately cost you a truckload of more interest payments.
For example, suppose you take out a car loan to 20 000 5 If you borrow money over four years, your monthly payment will be 460 59 After four years, you have paid 2 108 12 interest.
If you borrow money over ten years, your monthly payment will be 211 12, but at the end of 10 years you will have paid 5455 72 interest.
Keep your loan term to five years or three is great and you should be in good shape if the monthly payments are too even to five years, the car you are looking to buy is probably too expensive.
Consider all the money pools If you sell investments to pay for the car instead of borrowing to 7 That's a tough call; In general, we would say Do not skip any of your retirement savings sheltered IRA tax, 401 ks, you'll pay through the nose penalties and taxes and steal your future As for taxable investments, whether the tax collection would have consequences you have to pay 15 capital gains for investments held more than one year; investments held less than a year are taxed at your income tax rate on ordinary income or you may need the money for something else in the next two to three years.
If you take out a mortgage to pay for a car, since the interest on these loans is tax deductible.
Many people think that home loans are the ideal way to finance the purchase of a new car, but the length of the term of a home loan most require payment of at least 10 years, with penalties prepayment be sent to your total cost through the roof even after the tax savings Borrowed for more than five years, the lease if you have no more than three If you are considering a home equity line of credit pay for your car, remember that most HELOCs have a variable interest rate, so it's possible your payments will increase over time.
You will present at the dealership with your own loan, but where it should come ready to go.
Start with an idea of the prevailing rate for a new car loan is Focus on the APR, or annual rates offered by each lender's APR is the annual cost of the loan, or interest rate With this number you can against a - compare loans from one lender to another, as the loan terms are the same.
You'll probably get the best deal on a case of a members only, non-profit bank that can offer loans at lower cost than a traditional bank can only check the rates in traditional banks and online only auto lenders such as Capital One and E loans.
Don t be distracted by dealers that offer discounts or zero percent financing if you get your loan through their zero percent financing means that you are not paying interest on the loan So if you buy a car which cost 24,000 and you had a 48- month loan car, your monthly payment would be 500, no additional interest a discount is money taken from the car price discounts are also called cash price -back.
Here's the thing about these deals The money you save in interest and discount is likely to come from somewhere if you are eligible for 0 interest and most people don t like it's given only to people with a near-perfect credit, the dealer won t budge on the sticker price if you take the discount, you will not get a rock-bottom interest or 0 Deal.
This why the split financing and the purchase of your car is a good idea at first, you can shop around for the best syndicated credit car loan, and you go to the dealer and focus on negotiating the price buying the car Consolidate transactions can lead to much stress and additional costs can be so focused on financing costs as you punt on the purchase price to distinguish.
If you choose the financing of dealers, be very careful about what you accept and what you are signing it is not uncommon for dealers to add unnecessary costs in various rustproofing, extended warranty that fatten their bottom line every issue who had not been explicitly discussed during negotiations and don t be afraid to walk away.
There are easy ways to catch a break with your dealer when negotiating the price of your Timing car can be any store at the beginning of the week The weekends are prime time for dealers But if you have a Monday, a seller may be more motivated to reach an agreement because business is slow for the next few days.
Shop at the end of car dealers get monthly bonuses if they move enough metal If you are 30 and your seller is two cars short of a bonus, he or she can cut you a better deal so make figures.
Buy a car that is about to be replaced discontinued fairly simple logic, here are things that are about to be considered old sell less If you are looking at a 2008 Honda Accord and the 2009s are about to arrive at the dealership, you can usually get a good deal if the 2009 model is completely new and different from 2008, you'll save even more who wants to drive smart look old model, frugal people, the art and if Honda decides the agreement is not sale much and kills after year model OK, fat chance, but this is just an example of untold riches await as potential maintenance headache Remember you, some cars are unpopu LAR for good reason.
- Figure out what your monthly payments might look like auto loan.
SmartMoney - Decide whether to rent or buy a car.
Kelley Blue Book - A price index for new and used cars.
American Association Self - giant group for various issues related to the car flat tires to finance.
WSJ Autos - The cover of the Journal of everything. Automatic
How to finance an auto purchase Personal Finance, finance, auto, shopping, your monthly payment.