The Importance of Putting Money Down

Many of our customers ask us if they need to put money down when they buy or lease a vehicle. Our response is that while they often do not need to put money down, it is preferable that they do. We strongly recommend that our customers use a cash down payment or trade equity when they are financing another vehicle purchase or lease, for several reasons.

We know that everyone lives on a budget. The more money you put down up front, the lower your monthly payment will be. Every little bit helps, so even a few hundred dollars on top of your trade now can give you a much more affordable payment later.

On a related note, banks determine the interest rate on your loan based on their perceived risk of late or missed payments, or default. Putting money down on a loan is a signal to the bank that you are less of a risk, and will often get you a lower interest rate.  And a lower interest rate on your loan means you pay less in interest over the course of the loan, which gives you a lower monthly payment.

Finally, putting cash and/or trade equity down on a vehicle gives you a better equity position sooner. A good equity position helps protect you from owing more than your vehicle is worth.

While we will absolutely work a deal for you with no money down, we believe that a good down payment and/or trade-in will put you in a better position sooner.