1 in 5 trade-ins had negative equity. Many buyers have to roll the outstanding loan balance from their old ride into their new vehicle, new data show.
I liked at the right price. It took a while because I was waiting out the dealer markups ranging from a few thousand dollars to as much as $10,000 above MSRP, or manufacturer’s suggested retail price.You can’t borrow your way to wealth. Learn how to save, spend mindfully and talk about money with your family and friends.I refuse to pay any markup: They are opportunistic money grabs on the most in-demand vehicles.
This reverses the trend of the last few years when dealers paid extraordinarily high prices for used vehicles because they were desperate for inventory.“Some people got accustomed to the idea that the dealer would buy the car off of me for the same price that I bought it last year because a year and a half ago, that’s what they did,” Drury said.
The average monthly payment on a new vehicle hit a record-high $739 in the last quarter of 2023, according toor more a month swelled to 17.9 percent, also a record, during that period. That compares with 15.7 percent for the same three months of 2022.
Remember that with a longer-term loan, the value of the car declines faster than the loan balance. And the longer the loan, the more interest you pay.Far too many consumers walk into a dealership with one thing on their minds — the monthly payment.Consider the total cost of the purchase, including interest, maintenance and insurance.