Question
Advice when buying a new car
Start with
the assumption that your family needs a new vehicle. · Choose a vehicle that
you think fits your needs. 250 word discussion post · Go online and research
the cost of this vehicle. Decide how much you can put down on the vehicle
and/or how much your current vehicle is worth as a trade-in. Next, using your
credit score, find approximately what loan interest rate you should use.
Sometimes your bank can help you with an estimate, sometimes the car dealerships
can give you an idea. Next, decide how many months you are willing to take to
pay this off (normally in months 36 months, 48 months 60 months, or even 72
months) Once you have this all assembled, open Excel and find the
"Loan Amortization Schedule." Calculate in the first Tab of Excel
your monthly loan payment, and how much in interest you will pay. Should be an
eye-opener. · What advice would you offer to someone considering the purchase
of a vehicle?
Expert Solution
After
deciding on the car you want, the next step should be to get a pre-approved
loan from the bank or any lending institution based on your credit score and
how much you are willing to spend on the car you want. This step should be done
before visiting a dealership. For example, I wanted a Mazda Axela 3 2019 model.
I did not have an old car to trade in, but my car of choice was within my
budget of 30,000 dollars. The importance of this step is to prevent an
individual from being given a higher interest rate than what they qualify for
at the dealership. Dealerships are legally allowed to increase interest rates
even when eligible for a lower percentage of interest rates.
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