This means that the vast majority of car-buyers will pay for their four-wheeled purchases with help of auto loans
This means that the vast majority of car-buyers will pay for their four-wheeled purchases with help of auto loans Even if you plan to finance your next car, you may still need to make a down payment on that auto loan. Let's face it: Only a fraction of us will ever use cash to buy a car outright. In fact, according to a recent study by Experian, more than 85% of new car purchases were financed last year. But just because you're taking out a loan for your next car doesn't mean that you will walk out the door without paying anything. There's still your down payment to consider. A down payment is a partial contribution that you, as the buyer, are expected to make when you finance a purchase. Down payments are typically required to be made in cash, and are commonly requested for auto loans as well as home mortgages. A down payment is essentially the bank's way of ensuring that you also have a little skin in the purchase, instead of your lender taking on all of the risk. Depending on how small or large of a down payment you make, though, you also have the ability to impact your auto loan terms and scheduled monthly payments. There are a few great reasons to fork over a down payment on your new car purchase.