The Right Size of a Down Payment

  1. The Right Size of a Down Payment
The right size of downpayment for a new car

A down payment is a great way to help you get an affordable, manageable auto loan, but people often ask about the appropriate amount. So how large should a down payment be?

While there is no single formula for the perfect down payment, there are a few things you should consider. Edmunds.com, one of the leading sources for automotive information, says conventional wisdom holds that car shoppers should shoot for a 20% down payment. However, according to their numbers, the average down payment hovers around 11%. Edmund's recommendation: strive for a 10% down payment. This will help you cover depreciation in the unfortunate event of an accident or theft.

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Benefits of a Down Payment

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Lowers Monthly Payment

Having a down payment can significantly reduce your monthly bills by slashing the total amount borrowed.

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Increase Vehicle Options

If you provide even a small down payment, it will greatly enhance your vehicle options, letting you choose more cars and trucks that may fit your specific needs.

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Reduce Spending on Interest

For every dollar borrowed, you will pay in interest, so you will save in the long run by having a larger down payment.

What if I Can't Make a Down Payment?

Making down payments on cars

It happens all the time, so if you simply can't make a down payment, don't sweat it! We work with people every day to secure financing on car loans, with or without a down payment. A down payment helps, but you should know that it's not essential. You can still get a high-quality loan, even without a down payment.

If you need a vehicle but can't make a down payment, you're not alone, so let us help!

If you need an affordable auto loan, work with McGrath Credit by calling or sending a text message today! Get started by filling out a Credit Application right now.

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