When you're interested in getting a new or pre-owned car, truck, or SUV, and you know you'll need a loan to buy it, you'll be asked if you want to use a down payment. In this blog entry, we discuss why down payments can be a great choice for you.
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rnDown payments are usually expressed as a percentage. For example, if your finance professional recommends a 10% down payment, that means a vehicle with a $30,000 purchase price would require you to supply $3,000 at the time of sale. The good news is that your down payment can be paid with cash or by trading in a vehicle that has good equity. If you are financially able to, your best bet is to provide both – have a trade-in with good equity and to put extra cash down.
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rnLoan vendors appreciate you supplying a down payment because it demonstrates your commitment to paying back the loan. The lender will see your loan as much less of a risk than someone who doesn't give a down payment.
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rnHow much you should put down
rnTypically it's wise to pay at least 20% of the purchase price of your chosen new ride in cash, trade, or a combination of both. This helps keep you from having negative equity in the future. It can also help you get a lower interest rate on your loan!
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rnBenefits of a down payment
rnBy providing a decent down payment, not only are you lessening your risk of ending up with negative equity and potentially getting a lower interest rate on your loan, your monthly payment will be lower! This also helps save money over the life of the loan because by borrowing less, you're paying less in interest fees.
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rnBut what if I'm broke?
rnDon't despair if you don't have the cash on hand right now. Tax time is coming up very soon! SVG Motors is partnering with H&R Block in January and February of 2020 to make it super easy for you to get that nice down payment for your new ride. Not only will H&R Block be set up at the SVG Motors Beavercreek location starting January 11th, they'll give you an instant, no-loan-fee refund advance of up to $3500 to use immediately as a down payment on a new car! Even better than that, SVG Motors will pay your tax prep fees (up to $200!) if you use your instant refund toward the purchase of a new or used vehicle from our wide inventory. For more information about this great offer, click here.
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