Hyundai Finance Tips: How to Budget for a New Car

For most people, a car purchase will be one of their biggest investments. This makes budgeting a necessity. While setting up a budget isn’t rocket science, it does require thoughtful planning. At Blaise Alexander Hyundai of State College, our Hyundai finance department can help.

How Much Can I Afford?

The first step is to determine how much you can afford to pay. This is critical for determining which vehicles are within your budget range. If a desired model is out of your budget, there are options, such as opting for the base trim or a certified pre-owned version. As a general rule, the monthly car payment itself should not be more than 10% of your monthly income. Total car-related expenses, including fuel and insurance, shouldn’t exceed 20% of your monthly earnings.

Set Aside the Down Payment

The minimum down payment is 10% of the car’s manufacturer-suggested retail price (MSRP) in most instances. However, most dealers and finance professionals recommend setting aside enough money for a 20% down payment. This is strategically important for two reasons. First, having the money available for a 20% down payment makes you a more attractive applicant to the lenders.
Second, a higher down payment makes it easier to aim for a shorter repayment term. Repayment terms range between 24 and 84 months. Settling for a shorter term means less time for the interest to accrue.

Get Hyundai Finance Assistance at Our State College, PA Dealership

Buying a car can be an exciting time. However, there’s also a lot of planning that has to go into it beforehand. The Hyundai finance team at Blaise Alexander Hyundai of State College can help. We’ll work with you to determine what you can realistically pay monthly. Get started today!

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