The financial experts at Orlando MINI help first-time car buyers all the time. One of the most difficult steps in the car buying process is creating a budget that caters to your unique needs. Here is how to set up a car loan budget seamlessly.
Know What You Owe
Estimating how much money you can spend on a monthly car payment depends on quite a few factors, mainly how much money is coming in and how much is going out on monthly expenses including your rent or mortgage, student or credit card loans, utilities, and food.
We recommend only spending about 15 percent of your pretax monthly pay. So, for example, if you earn $50,000 annually, you can afford a monthly car payment up to $625.
Monthly Car Loan Payment
It’s critical to understand that you will be spending more on your car than just for its monthly loan payment. Items such as gas, insurance, maintenance, and more should be factored into your overall and monthly budget.
Trading in your current vehicle as part of your initial down payment is recommended for those who want to save. Down payments should typically be 20 percent of the car’s total cost. The higher the down payment, the lower the monthly payment. Feel free to use our online tool to receive an estimate of what your vehicle is worth; an official value will be provided with an in-person appraisal.
To learn more about smart budgeting, contact our Orlando, FL car dealership. We look forward to helping you find the MINI model that’s perfect for you!