This is a monthly payments guide: 80% to 85% of car buyers finance their car!
Terms of the loan:
Banks and Credit Unions will base their loan decisions and monthly payments quote if they have the following information;
The Year, make and model of the vehicle and the amount to finance typically determines how long they will finance you. Terms of contracts are usually calculated by 48,60,72, or even 84 months (we will never recommend going 84 months its too long, the car will be 7 years older before you get it paid off.
Longer contracts such as 72 or 84 months make it difficult to trade out early and the term upside down is used.
It is a major issue when working with a 4 square to know the term that is used in the calculation of your payment. Before you agree to anything make sure of the number of payments.
We recommend getting some kind of pre-approval from a credit union, they seem to have some of the lower interest rates. If it is a new vehicle sometime you can get a 0% interest rate. Dealers can make what is called back end money by raising the interest rate.
They get it bought for 7.49% and they charge you 9.49%. They make a 2 point spread, which could mean as much as $1200 in profit for the dealer which you just paid for.
When a dealer quotes you a payment on the 4 square by law in most states they are required to disclose the term used, interest rate, payment and if there is anything added. Such as extended warrenty, gap, or any other add on's.
60 months @ $287 12.99% and if any thing has been added(make sure all this has been disclosed, if not ask how they arrived at the payment).
Sometime you might get the 3 payment option
(48 mo. @ $342) (60 mo. @ $287) (72 mo. @ $254)
They will ask you which payment works for you.This is to get you to choose a payment and forget about the rest of the squares. Don't do it, look how 60 x $287 = $17,220 in total payments + any down payment you have given them.
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