Financing question for you math guru's?

Question

so say i want to buy a brand new car the price is 40K right. lets say with like 840credit, 1500 down how much should i be expecting monthly payments? roughly?

Answer 1

Well there are still a lot of variables being left out to know for sure. But let's say you get a 4% interest rate (pretty good chance w/your credit) and you want a 5 year loan, and after the down payment your financing 38,500, the payments would be about $709/mo.

Answer 2

It depends on the interest rate and the length of the loan.

For example, a five year 7% loan of $39,000 = $772 per month.

A six year, 6.5% loan = $665.

If you can afford a bigger downpayment, the payments will also decrease.

Bankrate.com has a good loan payment calculator.

As a note of caution, though, why are you buying a $40,000 new car?   A $700 payment (plus figure $350 a month for insurance, gas and taxes) means you will be spending about $40 a day, every single day, even if the car never leaves the driveway.  Wouldn't a cab be cheaper?

There are plenty of good cars that you can get for less money.  A late model used car (only 1 or 2 years old) is almost always a better deal than a brand new one.  

My advice is to start putting away $1,000 a month now to a savings account, as if you were making that payment, and see if it hurts your budget.  If after 10 months it doesn't hurt, then use the $10k that is now in savings to make a hefty downpayment on the car.

Good luck

Answer 3

about $590.00 per month plus insurance and depending where you are from a tire tax