Ever wonder how down payments work when you’re buying or leasing a new or used vehicle? The Folsom Auto Mall tries to make it simple for you.
Unless you’re buying a vehicle outright - that is, handing over a cash or check for the full value of the vehicle, chances are, you’ll be financing or leasing. Whether you’re financing or leasing a vehicle, a down payment (or cap reduction, when discussing a lease) is the initial money you pay toward the full sale or lease contract price. This lowers the remaining balance owed; that balance is paid over a contracted term, typically anywhere from 36 to 72 months.
The amount of money you put down will vary. If your credit is not great, most financial institutions will require a larger down payment. With good credit, you can sometimes drive away without putting any money down. That’s what is meant by “$0 down.” Zero down means you’re not putting any money toward your loan or lease; however, there are still some fees you may have to pay like tax, tag, title or dealer fees. Putting zero down means you’ll be paying the entire balance of your loan or lease over the course of the agreed upon term; that means your payment will likely be higher. Sometimes a manufacturer may assist with “bonus cash” or “rebates” to use toward your down payment or cap reduction to make the vehicle more affordable.
Whether you’re buying or leasing, the more money you put down up front, the lower your monthly payment will be. Lease terms typically last 36 months (that’s 3 years) while finance terms could be much longer. Depending on your credit, your finance term can be as long as 7 years. Interest rates also play a role in your actual monthly payment. The lower your interest rate and the longer your term, the lower your monthly payment will be.
The Folsom Auto Mall has experts in their finance departments who can help you decide what terms would work best for you and your budget. Whether it’s financing or leasing, the length of your term or how much money to put down, the Folsom Auto Mall can help. There are almost always $0 down deals available for both new and used vehicles. Stop by your favorite dealership to find out more.
Unless you’re buying a vehicle outright - that is, handing over a cash or check for the full value of the vehicle, chances are, you’ll be financing or leasing. Whether you’re financing or leasing a vehicle, a down payment (or cap reduction, when discussing a lease) is the initial money you pay toward the full sale or lease contract price. This lowers the remaining balance owed; that balance is paid over a contracted term, typically anywhere from 36 to 72 months.
The amount of money you put down will vary. If your credit is not great, most financial institutions will require a larger down payment. With good credit, you can sometimes drive away without putting any money down. That’s what is meant by “$0 down.” Zero down means you’re not putting any money toward your loan or lease; however, there are still some fees you may have to pay like tax, tag, title or dealer fees. Putting zero down means you’ll be paying the entire balance of your loan or lease over the course of the agreed upon term; that means your payment will likely be higher. Sometimes a manufacturer may assist with “bonus cash” or “rebates” to use toward your down payment or cap reduction to make the vehicle more affordable.
Whether you’re buying or leasing, the more money you put down up front, the lower your monthly payment will be. Lease terms typically last 36 months (that’s 3 years) while finance terms could be much longer. Depending on your credit, your finance term can be as long as 7 years. Interest rates also play a role in your actual monthly payment. The lower your interest rate and the longer your term, the lower your monthly payment will be.
The Folsom Auto Mall has experts in their finance departments who can help you decide what terms would work best for you and your budget. Whether it’s financing or leasing, the length of your term or how much money to put down, the Folsom Auto Mall can help. There are almost always $0 down deals available for both new and used vehicles. Stop by your favorite dealership to find out more.