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Is it worth it to make a very small down payment on a car loan, such as $500 or $1,000?
Is it worth it to pay a small down payment? I've heard that you should always make some sort of down payment on a car loan. However, I only have about $500 or $1,000 to put toward the down payment.
Eric Schad · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
“That’s highly dependent on the value of the car.
If you’re buying a $50,000 car, a $500
down payment
won’t make a ton of difference on how much interest you pay.But if you put $1,000 down on a $7,000 car, that’s going to make a huge impact on your loan and loan payments.
So there’s no steadfast rule as to whether putting $1,000 down on a car is worth it.
As a general rule, you want to make a 20% down payment on a vehicle. If you can’t afford that, consider other options, like
leasing
.”View full answer
- Gregory R.
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